There are some small steps we can do now to restore faith in our markets and get our economy back on track.
Continuity: We immediately need a new Treasury Secretary that both Democrats and Republicans can agree on now, to provide continuity no matter who wins the November election. That means that President George Bush, Democratic Party candidate Barack Obama, Republican Party candidate John McCain, Speaker of the U.S. House of Representatives Nancy Pelosi, and other leaders should stop their silly posturing and get together right now to select a mutually agreeable Treasury Secretary for the long haul to get us out of this mess.
Capital Formation: The government should declare a capital gains holiday for all new investments made during the next six months and held for at least three years. A capital gains holiday will result in a major infusion of badly needed capital and bolster our economy. It will reward risk taking during our uncertain times.
Bankruptcy Laws: Bankruptcy laws should be amended to allow financially responsible homeowners to regain their financial footing. Subject to certain guidelines, they should be permitted to make reduced payments on their mortgages and the amount of any reduction in payments can be added to their principal balances to be repaid over time.
I believe that the above steps will be better than the ill conceived $700 billion plus bail out plan offered. The current bail out plan should be scrapped. America requires a Sarbanes-Oxley II to enhance corporate financial disclosures, controls, and governance. For additional information about Sarbanes-Oxley, start here.
Blog Update
The Stupid Nation Blog adds:
Our allegedly "conservative" led government seems hell bent for leather to nationalize the U.S. economy, and in significant measure, dismantle capitalism (whether temporarily or permanently remains to be seen).
Later, the blog goes on to say:
We need calm, deliberate, thoughtful Congressional action consistent with capitalist principles to help right the markets. Throwing capitalism out with the rest of the bad debt trash is not the answer. The world is littered with failed socialist states, and the graveyards of Europe and Asia are chock full of the victims of socialism and it's hideous derivatives. Some deregulation may have played a part in this confluence of horrid events, but we maintain that it was big liberal government meddling in the mortgage market which is the epicenter of this calamity. Without disastrous Government intervention, the sub-prime market would never have been able to become the monster that swallowed the world.
I agree and the Stupid Nation Blog is recommended reading for every concerned voter looking for a well analyzed and informative view of events.
More to come in future blog posts.
To be continued....
Written by:
Sam E. Antar (former Crazy Eddie CFO and a convicted felon)
Disclosure: No preference in the election at this time. Just disgusted with the lack of leadership from both political parties and the pandering that is going on.