Thoughts on the 700 billion dollar bailout?

I'm on a federal loan, Stafford so as far as I know, and I'm hoping it's true, that I won't have a floating interest rate.

I also picked the one that the government pays for interest for your whole time in school and at least a six month reprieve afterward.

Still, my loan is 11,000 dollars, which isn't bad considering others, and I have a low monthly payment for it, I'm lucky. I know a classmate who owes 40,000 dollars for her loan without interest.

The thing is, people get loans thinking it's a great deal and don't realize it later. The whole credit card, and I EMPHASIZE this for teenagers, is a plastic debt. The interest rates are a lasso to pull you in, and then the rate will go up, if you have one, I emphasize now to pay every month if you want your interest rates to stay low.

People don't realize, it's just smart spending, economists emphasize it all the time. The banks don't realize it, either, hence one of the reasons why they're in such poor shape right now.

Don't bite off more than you chew, and read the fine print, the banks did screw up massively, and I'm hoping that they at least learn from it.

 

*Fannie Mae ;)


But straight, now, if you don't need money, but know you will in the future, is the BEST time to get a loan. Banks are looking to give money out to reliable people right now, they need the income from interest! Think on it, you have great credit, you walk into a bank because you want to start a restaurant, say "I want a 7% fixed loan for x amount of money", if they say no, you walk. Just wait until they try to stop you at the door. Whereas you go when your restaurant is failing and you need money... you have no where to go. These are great time to get loans at low rates when "you don't need it", where its just incase, same with housing, same with stock.
Everyone looks at this situation as bad but its really not for us. For us students, this is the chance of a lifetime. Every stock is valued because of its intrinsic value, not actual. Just wait until people realize that we're not screwed. Our time horizon is 50+ years. If you buy a stock now, you have nothing but time on your hands and in the long run, it will go up by, I believe, 12% average.

 

You do realize that most banks have frozen and are not lending out money to anyone, right? Though you can go ahead and try if you have superb credit, and not that which teenagers and most young adults do, then perhaps you might get lucky. Most young adults have low credit ratings whether they have ever delayed in payments or not because credit ratings depend on a few things. The only people who could, as usual, take advantage of such at time would be the people above 35 with a solid credit rating of 700 heh. This excludes most people in the nation.

 

this whole thing is so hard to understand. but i have ONE last question: is this supposed corruption (as in the reckless spending of money and such) actually been proven or is it just speculation?

 

Proven as far as I know.

AIG and several other companies publicly announced what they were spending the money on when the bankruptcy started. AIG freely admitted in a lot of cases that they were spending the money freely.

CEO's admitted on owning mercedes, and top executives had weekend homes. The bonuses came despite the housing teetering on the brink.

And what Repliku and I said, the banks aren't going to give you anything right now, they are even refusing businesses for the holiday. Businesses DEPEND on those loans for the merchandise for the holidays, but banks are planting their feet.