Government Investment in Banks

Phantom · 10-14-2008, 01:21 PM

So the news that I'm sure most are aware of is that the government is investing in banks in order infuse cash. My understanding is this is being accomplished by the US buying shares of the banks.

This seemed like the obvious plan for any bailout to me from the beginning, whether it be a bank, brokerage or whatever. This way, the government isn't simply handing out cash, it as least has the opportunity to profit from the upside of any investments it makes. My question is, why wasn't this the original plan?

David Octavius · 10-14-2008, 01:27 PM

Probably because it sounds socialistic - as if it is the first step towards nationalizing the banking industry

Phantom · 10-14-2008, 01:35 PM

Originally Posted by David Octavius

Probably because it sounds socialistic - as if it is the first step towards nationalizing the banking industry

I'm against socialism as much as anyone, but if my tax dollars are going to be spent, I'd like to have the best deal negotiated for those dollars spent as possible.

WickedLou9 · 10-14-2008, 01:54 PM

Originally Posted by David Octavius

Probably because it sounds socialistic - as if it is the first step towards nationalizing the banking industry

Yeah I think there was no way that people would agree to the government taking part ownership of this many banks. But now it seems like there was no alternative so...

C4Casey · 10-14-2008, 03:55 PM

Nothing good can come of this. Every time the Government claims something will be limited and temporary, it becomes gargantuan and permanent.

Angus_Aboot · 10-14-2008, 06:05 PM

Originally Posted by C4Casey

Nothing good can come of this. Every time the Government claims something will be limited and temporary, it becomes gargantuan and permanent.

"Nothing is so permanent as a temporary government program." - Dr. Milton Freidman (I know, Friedman, but he has some good ideas.)