Bailout, Schmailout

October 1, 2008 at 5:08 am Leave a comment

I can’t speak for anyone else, but as I watched the market, and therefore my retirement account and 401k, plummet on Monday, I felt disgustingly helpless.  It was as if my money was being snatched away from me, nickel by nickel and dime by dime, and all I could do was watch it happen.  You can screw with many things in my life that don’t bother me much, but you don’t mess with my family, and you don’t fuck with my money.

Having done more reading than I should (and really have the time for) about this bailout plan, I am completely and totally against it.  Because, firstly, it makes NO guarantee that dolling out more than half a trillion dollars will protect my kids against having to bear this burden 20 years from now, and, as I discovered yesterday, some non-related language was being added to the bill.  Plus, who’s to say this money will create the economic rock bottom necessary to begin a resurgence and upswing in the market? No one, that’s who. What’s my non-expert solution? Everything is cyclical, including our economy. We need to let these companies take a “natural” course and follow the path they’ve created with what amounts to millions of bad business deals. Yes, we’ll see tough times ahead, but we as taxpayers can’t shoulder the burden for the ignorance and short-sightedness of Big Biz who in some drunken or stoned stupor thought it a good idea to lend hundreds of thousands to millions with horrible credit. Y’all, there’s a REASON their FICO scores were sub-600. Granted, I’m no economist, but I briefly opined via a Tweet yesterday as to my plan to help with the issue:

I propose a economical intervention: create bottom and rehab instead of issuing $700b in an enabling #bailout.

I say, get Ken Seely or Candy Finnigan or Jeff VanVonderen and do some kind of meeting to get this derailed runaway train on track.

In the meantime, one of the financial institutions we entrust with our cash, ING, sent us a little note with some helpful tips and advice for the inevitable difficult times ahead, and I thought they bore repeating.

  1. We will spend less than we earn. Saving a little out of every dollar we bring home is the foundation of independence. Without it, we can’t build equity in our home, we can’t invest for the future, and we can’t be ready for challenging times. We promise to pay ourselves first, always.
  2. We will use our home as a savings account. Besides shelter and comfort for our family, the role of a house in our financial life is to build equity. We will have a healthy down payment when we buy. We’ll choose the mortgage that lets us pay down the principal fastest. And then we’ll leave that equity safe where it is instead of spending it on things that don’t last.
  3. We will take care of our money. It’s not enough to have money in a bank. We will put it where it will grow. We’ll keep track of it. And we’ll check every account we have every year to protect ourselves against fraud or escheatment.
  4. We will defend our credit worthiness. Good credit is going to be precious in the years to come. We will pay our bills on time. We’ll borrow only when we need to and in amounts we can comfortably pay back. And then we’ll do just that.
  5. We will ignore unsolicited credit card marketing. We decide when we need a credit card, not some marketer. And mostly, we probably don’t need another one at all. We won’t even open those solicitations. We’ll shred them.
  6. We will know the cost of borrowing. The interest lenders charge us is real money, too. When we buy a mortgage or finance a purchase, we’ll figure out what that interest is really going to cost in dollars, add it to the purchase price, and ask ourselves if it’s still worth it.
  7. We will invest for the long term. Futures are built out of patience and prudence, not luck. We will not put off being a saver because we think there’s a lottery win in our future, in Vegas or on Wall Street.
  8. We will take care of the things we have. We work hard for our money, and it’s disrespectful to waste it – or the planet – by treating our possessions as disposable.
  9. We will remember what matters. We are not the things we own. If we have to spend and spend on bigger, more impressive things to keep up with our friends, then they are not our friends at all.
  10. We will be heard. Our representatives in government and the corporations we deal with need to know that we are paying attention. If we’re silent, we’re accepting the status quo, and the business practices that got our country into this situation will continue. We are not going to accept that.

My friends, I implore you to educate yourselves on the dire financial situation before us, as it’s the best protection against losing your shirt. Do what you need to, even if it requires a bit of channeling Suze Orman (one of my personal, financial heroes), in order to protect yourself.

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This is Me, As it Should Be Different, Perhaps. But Perfect, Still.

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