Thanks Yabby.

I had started to draft a sharp reply to hasbeen after he had a go at shooting his mouth off, but ended up biting my tongue at the time. He obviously has his own self-interests at heart to be so offended. Given that members of my family regularly live well beyond the average age, I am well aware of the concerns of older people. My own father has now had to postpone his retirement due to the sum wiped off his assets. He is however fairly ambivalent, given that he's a farmer and seen land prices rise and crash many times in his working life (has now been working for 61 years), and ridden through many hard times. Maybe that's where I inherit my attitude from. He's of the view that if you are invested in quality company's, the value will return in the end. And now is a great buying opportunity if you have been invested in cash.

The people that will be hit the hardest by this are the younger generation, the ones in debt the most. However, as I mentioned earlier these are also the people that are the most well positioned for long term recovery. Older people may lose much of the value of their investments, but for the most part once they are reaching or in retirement, these are invested in predominately cash assets (particularly since interest rates have been so rewarding), and less exposed to the current volatility than younger people with higher risk/longerterm investment strategies for their super. Any retiree with high risk international share portfolios is kind of asking for trouble - its called risk v return for a reason.

" 'Some' people don't understand that the necessary bailout does NOT mean business as usual for the people who made the mess in the first place. The regulatory controls will be much more stringent."

SallyG, of course there will more stringent controls. But what will that actually mean?

Obviously the necessary controls have been terribly lacking. So even if they are tightened up considerably, they may still not be anywhere near tight enough.

I don't for one moment think that they will be sufficiently strong. Essentially, it will be business as usual.

Ok so we may not ever see the crazy situation that now prevails again, but we will still be hooked into the continuous growth paradigm, where a steady rate of expansion in profits and turnover is demanded and even a slowing, let alone a stabilisation of activity, is considered to be a stagnation or recession in the operation of a company, market or country's economy.

We won't be on the right track until we get our heads around the need to have stabilisation as a goal instead of continuous growth.

Bail them out and put the banks and other financial institutions who need saving under mortage to the tax payer.Let them have 50yr mortgage and repay both the interest and capital.

The personal arguments I've heard from a friend in California AGAINST bailing them out go something like this -

"The Banks and their customers got themselves into this position because of their own greed and lack of due diligence in their financial dealings"

and

"I've always done the right thing and never over-committed. Why should I now have to pick up the tab for those who weren't?"

and

"My retirement plans are pretty-well shot now. If I don't lose my job, I'll be paying more taxes instead. Why should I even care anymore?"

(plus a few that I'm not going to repeat).

All reasonable arguments on a personal level but it's not a decision that the correspondent (or any of us) is able to make.

Whatever happens - recession or depression, it's going to get ugly for a lot of people everywhere.

Rache while I understand your Friend Arjay is closer to my reality.
I owe nothing, not a cent to any one.
Years of going without made me the first in a large family to pay cash for my home.
Yet I am already a victim of this crash, so are most of us.
My home once worth two and a half times its purchase price is worth 40% more than I paid for it.
And unsellable.
My super fund lost 5% last year , including part of my 20% salary
sacrifice I paid to keep me from social security, time does not exist for me to rebuild the loss.
This year? even with the bail out almost for sure minus ten percent is the result.
Bail them out, imprison many, bankrupt a few, and control the future dealings of Americas and the worlds greedy.
No other way exists our future even then is not assured, the victims are Joe and Joan average.
They are going to be hurt more than the products of unwed parents who got us in this mess.
Yes yes PaulL no defense some bought it on themselves but those who lent the money did so from pure greed.
I know it is wrong for those like me to pay,but no other way exists.

Lets not forget that Fannie Mae and Freedie Mac were DIRECTED to make (actually buy and wharehouse but it amounts to the same thing) loans to minorities and lower socieconomic groups, regardless of their ability to pay.

Lets not forget that the US system allows mortage customers to walk away from the loan and just hand back the house key, has a MASSSIVE role in this crisis.

Besides the greed of the banks who loaned the money, we should NOT be ignoring the greed of ordinary people who borrowed more money than they could pay back. I read of one woman on an american webiste complaining about those evil bankers, who'd borrowed 250,000 dollars on an income of 10,000 dollars a year.

There is just NO WAY there isn't two people responsible for that mess. And now that she's been allowed to walk away from the loan scott free, the bank is left with the debt. That is a common scenario.

By the way, some people seem to be under the misapprehension that this is an American crisis. It decidedly is not. This is a global problem that has potentially catastrophic outcomes for ordinary people everywhere.

People should take note of those who's ideological bent feeds their desire to see the US and Capitalism come crashing down. These people will happily put the average Aussie through 100 times more pain than John Howard could ever have imagined, in order to see this come about.

Thankfully it's not up to them. It would actually be interesting to know the potential losses to those who oppose the bailout. My feeling is that very few of them have mortgages, superannuation or jobs on the line, and will happily sacrifice those that do, in pursuit of their hatred.