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They would have gone out of business, the greedy executives would have lost everything since their stock options would be worthless not to mention shunned, and the middle and lower classes would have had their deposits insured by the FDIC to put elsewhere.
We'd be asking for loans from people that would take your thumbs as collateral. The real quuestion is why haven't any of these big bankers been prosecuted yet. Even during the Reagan years many people were prosecuted for the S&L crisis.
They would have gone out of business, the greedy executives would have lost everything since their stock options would be worthless not to mention shunned, and the middle and lower classes would have had their deposits insured by the FDIC to put elsewhere.
You seem to not grasp the fact that the majority of middle class savings didn't sit in low interest rate bank accounts, but rather in 401(k)s and other mutual funds. Nor do you seem to understand that every business large and small depends upon lines of credit as a source of day to day working capital. As investor fears rose on the possibility of the collapse of these large financial institution, the economies sources of credit tightened to such an extent as to become the principle cause for the downturn in employment and the subsequent collapse of the economy.
There would have been a run on the banks and depositors would have discovered the banks didn't have their money. Most banks would have failed and the banks that survived wouldn't be able to loan any money. Credit would have froze and our economy that was built on credit would implode. All people's wealth and retirement would have vanished. Our federal and state governments would be unable to borrow enough money to function. It would have created a worldwide depression that we would still be dealing with.
They would have gone out of business, the greedy executives would have lost everything since their stock options would be worthless not to mention shunned, and the middle and lower classes would have had their deposits insured by the FDIC to put elsewhere.
Wrong. The entire would have faced a financial collapse.
There are many public pensions tied into Wall Street funds. Those funds go down no money left. It's an entirely complicated spider web that Wall Street ties their finances into including supposedly safe municipal bonds used to fund public projects.
Don't think a crash would not affected the middle or lower class. It would have affected everyone.
There would have been a run on the banks and depositors would have discovered the banks didn't have their money. Most banks would have failed and the banks that survived wouldn't be able to loan any money. Credit would have froze and our economy that was built on credit would implode. All people's wealth and retirement would have vanished. Our federal and state governments would be unable to borrow enough money to function. It would have created a worldwide depression that we would still be dealing with.
That is the absolute truth. Too bad so many RWNJs can't get that through their thick skulls.
They would have gone out of business, the greedy executives would have lost everything since their stock options would be worthless not to mention shunned, and the middle and lower classes would have had their deposits insured by the FDIC to put elsewhere.
And Goldman Sachs has branch offices where you can have a bank account and buy CD's ?
No..we bailed out the banker's banks is what we did.
The big investment banks don't deal with us peons and our accounts.
Note the banks that they did let go under in the FDIC failed bank list.
As far as the others, like BOFA, it was their investment divisions, not their retail banking that had losses.
Bankruptcy could have easily mandated the separation so that the investment division didn't take money from the retail division.
That's exactly what Glass-Stegall was put in place for that our government conveniently reversed.
You seem to not grasp the fact that the majority of middle class savings didn't sit in low interest rate bank accounts, but rather in 401(k)s and other mutual funds.
Pretty sure 98% of middle class Americans have checking/savings accounts.
Quote:
Nearly all of these 2010 families (98%) had a checking or savings account, and the typical (median) amount in these accounts was $3,900.
I was saying their checking/savings accounts wouldn't be wiped out
Quote:
Originally Posted by ovcatto
Nor do you seem to understand that every business large and small depends upon lines of credit as a source of day to day working capital. As investor fears rose on the possibility of the collapse of these large financial institution, the economies sources of credit tightened to such an extent as to become the principle cause for the downturn in employment and the subsequent collapse of the economy.
So we bailed out the banks, and credit still tightened regardless. You don't seem to understand that the fundamental premise behind a credit crunch isn't that banks aren't lending to business, but that banks aren't lending to each other, which happened regardless of the bailouts. This of course, leads to a crunch of banks lending to consumers of course, but that is not a cause in and of itself. Banks didn't say "crap, Lehmen went bankrupt, let's quit lending to people" but rather "we're done lending to other banks." Why do you think the the federal funds rate is the target, as opposed to the actual interest rates consumers are charged?
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