How much will taxpayers shoulder?

[kandrathe]

I would like to add to this that in the past few months, several well known companies have tanked, costing thousands upon thousands of jobs you would of considered "secure" in banking terms. It seems this whole bailout discussion really started *before* all of the massive layoffs and big-name store closures going on, so factor in the thousands upon thousand more people who now can't pay for their homes, and you have an even bigger mess than a measly $700-billion can afford. I don't think anyone thought it was going to get this bad, and the sad part is economists have it penciled to get "much worse" before it gets better. I'd like to see what Obama has planned for the rest of that $250-billion, and wouldn't put it past congress to raise the ante even higher before the years up.

This was a foreseeable consequence to the implosion from a few months ago. With the financial institutions in turmoil, from what started as leveraging over leveraged assets (or at least assets with variable worth), has become a shortage of mobile capital in the form of short term loans (which many companies need at times even to float a payroll or two during a year). This is all coupled with "all the bad news" discouraging investors and consumers who want to hang on to their cash, or gold waiting for the storm to blow by before spending their money foolishly. Voila! Recession. A shortage of income results in the need for short term borrowing, and with stock prices plunging a company may not have the borrowing leverage it did before. On paper now, what looked like an acceptable debt to earnings or debt to assets ratio may begin to look quite distressingly bad now. This of course results in the scared banker to deny the loan, and the result is either chapter 11 reorganization, or actual bankruptcy. I predicted this recession over a year ago actually (based then only on the rapidly rising cost of fuel and its impact to the supply chain), and moved most of my riskier stocks(retirement, etc.) into cash.