PAULSON’S WAY OR THE HIGHWAY

I think the bailout sets a dangerous precedent and is a huge mistake. Let’s consider some other alternatives:

0) Eliminate the capital gains tax for a couple of years…this would flood money into our markets…

1) Borrowing is not the only way to raise money; companies can issue more stock as well. This is already happening…look at Warren Buffet’s recent deal with Goldman Sachs...hmmm, the market is already adjusting...imagine that.

2) Cut corporate taxes dramatically, at least in the short-term

3) Include a plan to balance the budget…this sounds obvious, but the concept is foreign to most politicians; cutting spending would increase market confidence a great deal ;however, no one is speaking this language (lobbyist corruption in Washington doesn’t promote reductions in spending, so this is wishful thinking, I know)

4) Offer up lower interest loans backed by the government to troubled entities and let these folks slowly work through their troubles over the next five years

5) Do one more rate cut of 50 basis points

6) Simply let more banks fail…they got themselves into this mess in the 1st place


I don't trust government to become landlord for an additional 5% of all U.S. mortgages (this is what the $700 billion represents, I believe). We won’t pay market prices for any of this junk paper...as taxpayers, we’ll pay ABOVE MARKET for this toxic waste.

If the companies with worthless paper are allowed to sell these bogus securities, they'll effectively take big losses...as such, these companies could become insolvent anyway due to the large losses taken on the books. How does the bailout help these companies? Let's get more capital infusion via stock issuances and offer up incentives instead.

If taxes are raised post-bailout, we’ll be in even worse shape. Let’s do ourselves a favor and vote the big spenders out of Congress. We need reform and we need it now in the form of effective (not more) government and investor incentives.

FMC