We Deserve It Dividend

You know I have spent a considerable amount of time over the last two or three weeks thinking about this silly 85 billion dollar "Wall Street Bailout." My initial reaction was (and still is) "HELL NO, NOT WITH MY TAX DOLLARS!" That said though, I will acknowledge that it is an extremely complicated mess that I'm not sure anyone has an answer to. Trying to figure out this mess created by the Wall Street greedmeisters is enough to make ones head spin like Linda Blair's did in the Exorcist.

Then, I received the following in my email. I'm not sure that it would have been the answer, but it couldn't have been any worse than the nonsense we've been getting from Washington and our two presidential candidates. Read on and see what you think.

To My Fellow Americans

I'm against the $85,000,000,000 bailout of AIG. Instead, I'm in favor of giving $85,000,000,000 to America in a "We Deserve it Dividend." to make the math simple, let's assume there are 200,000,000 bonafide U.S. citizens over 18 years of age. Our population is about 301,000,000 +/- counting every man, woman, and child. So 200,000,000 might be a fair stab at adults 18 and up. So divide 200 million adults 18+ into $85 billion and that equals $425,000. My plan is to give $425,000 to every person 18+ in a "We Deserve it Dividend." Of course, it would NOT be free...so let's assume a tax rate of 30 percent. That means every individual 18+ would have to pay $127, 500 in taxes on their "We Deserve it Dividend." That would send $25,500,000,000 right back to Uncle Sam. It also means that every legal adult 18+ in America would $297, 500 in their pocket. A husband and wife would have $595,000.00. What could you do with $297, 500 to $595,000 in your family?

Pay off your mortgage?--most if not all of the housing crisis solved! Repay college loans?--what a great boost for new grads! Put away money for college? --It'll be there when you need it! Save in a bank? --You'd be helping to create new capitol to be responsibly loaned to budding new entrepreneurs! Buy a new car? --Help create jobs! Invest in the market? --Capitol drives growth! Pay for your parents medical insurance? --Health care improves! Deadbeat dads would have no excuse for not coming clean. Pay or go to jail! These are but a few examples and the list goes on and on.

Remember this is for every adult U.S. citizen 18+ including the folks who lost their jobs at Lehman Brothers, AIG, and every other company that is cutting back. And of course, for those serving in our Armed Forces. If the liberals in this country are determined to redistribute wealth, let's really do it....instead of buying votes with a puny $1,000 economic incentive check that is being proposed by one of our presidential candidates. If we're going to do an $85,000,000,000 bailout, let's bail out every adult U.S. citizen 18+!

As for AIG -- LIQUIDATE IT!!! Sell it off in parts. Let American General go back to being general Americans. Sell off the real estate too. Let the private sector bargin hunters cut it up and clean it up. Here's my rationale....we deserve it and AIG doesn't. Sure, it's a crazy idea that would never work even if it wasn't crazy. Why? because THEY don't want it to. It would mean they lose a little of their power. But could you imagine the coast to coast block party that would occur this plan ever did happen? How do you spell economic boom? I trust that most of my fellow Americans would know much better how to spend 85 billion dollars. The geniuses at AIG and in Washington D.C. have already proven that they don't.

And the best part, this plan is even cheaper. Remember this plan will only cost 59.5 billion since 25.5 billion gets returned instantly in taxes to Uncle Sam. Ahhh...now I feel so much better after getting that off my chest!

Kind personal regards,

Hank in Bull Hampsha

Like I said before, I'm not sure that this would've been the solution everyone was looking for, but consider this...........

For the past few weeks, all we've been hearing is that without this "reward for Wall Street," oops, I'm sorry.....I mean bailout, the American economy (and eventually the world economy) would crumble and we would all be facing difficult troubled times.

But here in California, in my little corner of the world, a gallon of gas is cheaper now than it has been in almost a year. Just a few days ago, I had to stand in a rather long check-out line at Walmart.....that's how busy the store was. Last night I took my son to see a movie in a theater that was packed with only one or two empty seats in the whole place. And finally, in today's paper, I read stories about modest gains in existing home sales and how it's getting better with every week that passes. They also said the coming months are looking better than expected too. I also read another story about how now is the perfect time to jump in the stock market and start buying stock in companies like General Motors and Yahoo. The reasoning....they are solid companies that have taken big hits but are primed for huge rebounds.

From the sounds of this, it doesn't seem that Main Street America (or at least this part of it) is running around like little girls with their hair on fire the way Washington, the bankers, and the greedmeisters in Martiniville are.

In other parts of the country, the rebound/recovery might take longer, but is it really necessary to reward what should be considered criminal behavior with an 85 billion dollar bailout? I say no!!! Let those greedy mortgage lenders, investment bankers, and the politicians who defend them twist in the wind for a bit. Just like the unsuspecting home-buyers were forced to twist when those adjustable rate mortgages started "adjusting."

I know the bailout is already a done deal....but maybe, just maybe America would've have recovered more quickly and been much better off if we had thrown the "criminals" in jail where they belong and presented the rest of the country with a "We Deserve it Dividend!"

What do you think?

Til next time..................

The Road To Failure

Of all the recent failures and near failures in the current banking crisis, the story of the Lehman Brothers investment banking firm is probably the most disappointing. The man above, Richard S. Fuld, Jr. was the final Chief Executive Officer of the company that many credit with financing the birth and growth of the American Railroad Industry in the mid 1800's. Lehman Brothers also played major roles in the financial growth of household names like Sears and Roebuck, RCA, and B.F. Goodrich. The company had a storied history and became a major player in the American economy since it's birth in 1850. So where did it all go wrong? One has to look no further than those classic sunday school teachings about the seven deadly sins and number three on that list.......greed.

Much discussion has taken place over the "toxic" sub prime mortgage mess which figured heavily into the Lehman failure. This, however, was only part of Fuld's problems where Lehman Brothers was concerned. While painting a rosey picture to the shareholders and the public, behind the scenes, the picture was bleak. In an effort to save the company from his failed practices and deals, Fuld tried to broker yet more deals with other groups (including A.I.G) who had problems of their own. He sent people to both the Middle East and Asia to try and find fresh money with no success. As hard as he tried, he just couldn't find an acceptable deal that would save his crumbling empire. But again, how did he get to this point?

Greed. It wasn't enough that his company was, albeit small and independent, a heritage company in the investment banking business with a rather healthy portfolio. It wasn't enough that he had, by all reports, a fiercely loyal staff that would have walked through the fires of hell and back if he asked them to. It wasn't enough that he had over 800 million in company stock, an art collection said to be worth millions, and several luxury homes in his name. There had to be more and he was going to get it.

I can't imagine what it would be like to be that wealthy. Quite frankly, I'm not sure I want to know. But today Richard S. Fuld, Jr. still finds himself "working" for the company even though all of his once loyal employees have been dismissed and have lost their severance packages and health benefits. His current net worth? According to sources, Fuld is worth about 100 million dollars.

During a recent appearance before a House Committee on Government Reform, Fuld wanted to blame the media, the short sellers, the government and anyone else that came to mind. While he took responsibilty for the end result, he refused to acknowledge that Lehman's failure came about as a result of his poor choices and extremely risky deal making. Read the full transcript here.

It is often said that the road to hell is often paved with good intentions. In this case I would say it was greed, deceit, and extreme arrogance on the part of Richard S. Fuld, Jr. and his senior Lehman executives that paved The Road to Failure for one America's oldest investment banks.