BrunoT

Bailout Cost, per Taxpayer, by Income

JasonC.

Interesting point. But did you stop to realize that aggregate GDP is not spread uniformly? What if most of the gains/benefits accrue to the top 5% (those who own stocks of these companies and others) yet the bonds are repaid by a broader spectrum? (those who consume most of their income)

And more things come to mind that should be considered. What of the costs of inflation caused by injecting dollars into the economy, which is born more heavily by "working class" people, as the costs of necessities is a higher percentage of their income. And what of the intangible costs of the moral hazard created? Put a value on that one! And from what I'm reading $700B is not the end of it. What happens when CDS and credit card and auto loans are added to bailouts? Where does it end? And once we're in for $700B, there would be severe pressure to "protect our investment" with further cash outlays.

I think the calculations required here are beyond any one page column.

The Nuttiness of This Market

I can't understand the crazy market in the short term, but hopefully the long term macro picture that I DO understand will show out in the long run. I think that commodity markets have become yet another new "fad" like dot.com stocks and RE, except that this time it's the big boys and traders playing the game, not neophytes off the street. But you can only fool people so long. When those non-financial people DO figure it out that their currency is losing real value, that the govn't statistics are phoney, and that you can't make money owning stocks that don't make profits, there is great potential for a TSUNAMI of cash to flow into commodities as people search for something tangible in an ocean of fiat currency.