02-14-2009, 03:25 AM
<!--quoteo(post=17867:date=Feb 13 2009, 03:47 PM:name=BT)-->QUOTE (BT @ Feb 13 2009, 03:47 PM) <{POST_SNAPBACK}><!--quotec--><!--quoteo(post=17866:date=Feb 13 2009, 03:40 PM:name=rok)--><div class='quotetop'>QUOTE (rok @ Feb 13 2009, 03:40 PM) <{POST_SNAPBACK}><!--quotec-->My main problem with this entire idea of stimulus is that it will take 2-3 years before any actual jobs will be created. Getting the TARP plan right is still my biggest concern at the moment, because whether people want to accept it or not, the economy lives and dies with the banking system. A sick banking system and overly levered financial industry led us into this mess. You fix that, and everything else falls into place: real estate, consumer confidence, and small business activity. I see the stimulus as mostly an added bonus to the TARP. The main focus shouldn't be on the stimulus IMO, and once again the media and politicians have it wrong.<!--QuoteEnd--><!--QuoteEEnd-->
But they are working on TARP. Apparently not doing a very good job, but they got at least 700 billion, and my guess is that they will get more. Probably more than the stimulus.
And I thought that many of the infrastructure programs in the stimulus bill could be creating jobs in as little as 3 months?
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Working on TARP, yes, but whether it actually does what was originally intended is anyone's guess. The first $350 billion went out and created some stability, but capital is still not flowing as it should. The 2nd stage is still being debated, but now appears to center around the creation of a "bad bank" that will assume much of the toxic assets that are still on most bank balance sheets. Details are still thin, so I'm not sure what to think, as much of what might happen could run into roadblocks due to contract/legal issues and could also be delayed because markets/clearinghouses still need to be developed in order to price these bad assets in order to value them for sale. That could take months, or it could take years, but it is central to our recovering from this credit market instability and to solving the mortgage mess, and thus the economic crisis as a whole.
Also, as to your point about the infrastructure spending (which I do support BTW) I think 3 months is an aggressive time table. Capital spending projects usually take between 6-9 months to plan and 12-18 months to implement on average. The government knows this. That's why I'm questioning Congress' public plea for immediate stimulus in order to avoid further economic uncertainty, when in fact the vast majority of it won't be felt for another 2-3 years. I'm not necessarily arguing against it, just saying that most of the projections are aggressive and unrealistic.
But they are working on TARP. Apparently not doing a very good job, but they got at least 700 billion, and my guess is that they will get more. Probably more than the stimulus.
And I thought that many of the infrastructure programs in the stimulus bill could be creating jobs in as little as 3 months?
<!--QuoteEnd--></div><!--QuoteEEnd-->
Working on TARP, yes, but whether it actually does what was originally intended is anyone's guess. The first $350 billion went out and created some stability, but capital is still not flowing as it should. The 2nd stage is still being debated, but now appears to center around the creation of a "bad bank" that will assume much of the toxic assets that are still on most bank balance sheets. Details are still thin, so I'm not sure what to think, as much of what might happen could run into roadblocks due to contract/legal issues and could also be delayed because markets/clearinghouses still need to be developed in order to price these bad assets in order to value them for sale. That could take months, or it could take years, but it is central to our recovering from this credit market instability and to solving the mortgage mess, and thus the economic crisis as a whole.
Also, as to your point about the infrastructure spending (which I do support BTW) I think 3 months is an aggressive time table. Capital spending projects usually take between 6-9 months to plan and 12-18 months to implement on average. The government knows this. That's why I'm questioning Congress' public plea for immediate stimulus in order to avoid further economic uncertainty, when in fact the vast majority of it won't be felt for another 2-3 years. I'm not necessarily arguing against it, just saying that most of the projections are aggressive and unrealistic.