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I’m surprised by how well informed everyone around me is… I mean, I’ve been keeping up to date with the financial developments – but it just surprises me that everyone else has been too. I mean, wow… news readership is really high (or people are just as bored at work)!

Anyway, I think many people (including myself) are frustrated by the bail outs. I understand the rationales, and I think I may even agree with them, if it can be shown that they will have large consequences on the average taxpayer. However, I think the irreverent Stephen Colbert put it very well in his show on Thursday (Sept 18, 2008, The Colbert Show) in his interview with CNBC’s Maria Bartiromo:

“I believe that these guys should be able to speculate and do anything they want to make as much money they want, in any way that they want… in good times. And then when things go bad, we should bail them out so they can do it again later. [laughter] […] What I don’t understand is that this is from the giving and buying of bad loans, and we are about to give a 85 billion dollar loan to somebody who couldn’t run a business. Now, isn’t that a risky loan for the United States? Don’t we have a bubble-bubble?”

I love Colbert – and this is from a comedy fake-news show. Of course Maria points out that AIG is very large, and therefore the government HAD to bail them out. And so Colbert’s response?

“So the lesson here is, don’t just screw up. Screw up royally!”

Investment bankers earn a very high salary, to the tune of $80K + bonus, which puts them at $120K / year in certain years, right out of college. Sure, they work 90, 100+ hour workweeks. But I think my feeling is this – the financial industry dug this hole for itself, because they gave out and took on really bad loans. They made money from that when they could, and when people caught on, they were punished. And we should let them all go bankrupt, and get acquired, etc, even if it may be somewhat hard for everyone else too. Because I believe that the brunt of the pain will still be felt by the finance industry – not the whole economy. And they deserve it. You can’t just let them take the risks, and bail them out when they fck up! That is not fair! Why should a normal taxpayer, earning WAY less than they do have to clean up their mess?

I know the argument about how a weak financial industry leads to tighter credit, which leads to fewer loans, which impacts smaller businesses, and then in turn impacts consumers. But I don’t think this trickle down effect will cause more pain that the average consumer can handle. I mean… $700 BILLION USD in bailouts? Are you kidding? Ok. Think of it this way. That’s approx $2000 tax dollars per person, assuming 300 Million people paying equal taxes. That’s a heck of a lot of money! Is Lehman Bros failing, Merrill getting acquired, AIG failing REALLY going to impact my life by $2000 bucks? I’m not totally convinced.

I’m pretty sure the $700 Billion could be spent on providing public healthcare, or a better education… or you could just hand it out to the people who are not to blame something. Just not spent on putting money back in the pockets of bankers. Especially not when the former CEO of AIG is being paid a severance package worth $47 Mil, and the Lehman CEO took home $34.4 M in 2007.