$700 Billion Bailout

The 1929 Stock Market Crash was created by speculation in the Stock Market. People bought shares with 10% of their own money and 90% borrowed from the banks. When stocks began to plummet, and banks made calls for their 90%, borrowers were unable to pay back their loans thus banks became insolvent. Eventually the Stock Market lost 89% of its value by 1932. In 1933, in result to the Pecora Commission, the Glass-Steagall Act was created, part of which separated Investment Banking from Deposit Banking.

In 1999, the parts of the Glass-Steagall Act created to separate Investment Banking from Deposit Banking was undone by the Gramm-Leach-Bliley Act. As a result, the US saw unprecedented growth in the DJIA, from approximately 9,000 in 1999 to 14,000 in 2007. Part of this unprecedented growth also occurred in the housing market, from a median income to median housing price ratio of 1:4 in 1999 to 1:11 in 2006.

The Housing Market was in part driven by sub-prime borrowing through various ponzi schemes such as Alt-A or Interest only loans. Unscrupulous lending practices by the banks and greed of borrowers to buy properties they couldn't afford otherwise helped drive up median housing prices. The banks repackaged these sub-prime loans under securities and bonds and sold them off via the new Investment and Deposit Banking Industry.

When sub-prime borrowers began to default on their loans, due in part to the resetting APR which made their barely affordable mortgage now unaffordable, an unraveling disaster was let loose. Investment firms such as Goldman Sachs, Merrill Lynch, Bear Stearns, etc. bought these bonds and securities. When that security is backed by sub-prime borrowing, and those borrowers default, the bond/security becomes worthless. As a result these investment firms kept writing down loss after loss and investor confidence decreased in their ability to remain solvent. Banks that were involved in lending to sub-prime borrowers, such as Countrywide or IndyMac, went belly up due to sub-prime mortgage defaulting and their inability to remain solvent.

Democrats and Republicans are both seeking a Federal bailout of Investment and Deposit Banks and Firms hurt by the collapsing sub-prime housing market, which also bought bonds and securities backed by sub-prime debt. DID WE NOT LEARN FROM 1929?! Undo the Gramm-Leach-Bliley Act, NOW! Let the bastards that borrowed money for a house they couldn't afford lose their house! Let the damned banks that lent money to these people fail! FORCE ACCOUNTABILITY INTO THE MARKET!!!

Democrats and Republicans are destroying this country with their deleterious economic principles. A free market system functions without the intervention of government. If people don't wake up and see what Democrats and Republicans are doing to this country, we're going to owe more than the approximately $30,000 EACH that we already do. The Federal Government is about to add another $2,300 to that $30,000 tab with this current bailout, and that's if it doesn't get bigger than the proposed $700 BILLION it currently is.