Explanation coutesy of Huzah on neogaf. This is the best way to explain it in the least amount of terms:


"They are only worthless in the sense that there's a HUGE liquidity risk to them right now. You have assets that perform but can't be sold on the market because there is no market. So you have banks sitting on these illiquid assets that can't be valued because there's no market for them, that can't get credit from other banks because nobody knows when these assets will blow up. Even if only 10% of the assets will blow up, 10% chance of 100% loss is to much for any bank to consider, like that german bank that got burned by lehmans collapse. Banks start hording massive reserves of cash, putting it in a mattress, and not lending it out, because they need the liquidity to survive bank runs and moves in the markets against them because they can't get credit through normal chanels. So those cash reserves that would norminally be lent out to businesses, homeowners, car dealers, student loans, are not being anymore.

Only the governemnt can take on the liquidity risk premium because they don't have to fear a bank run or capital requirements. THAT IS WHY THE BAILOUT IS NEEDED"

Totally agree.

Just awesome.  I'm so relieved.

I read that over 90% of the economist didn't want this bill to pass.

American people won today.  Many of my friends signed a petition to our congress to stop this bill.

Where can we find out who votes against it?  I saw on Fox last night that the Republicans are to be responsible if the bill didn't pass - but i'm not sure.

Fixed

The Toronto Stock Exchange is doing worse somehow:

http://www.tsx.com/en/index.html

as opposed to the Dow's http://finance.yahoo.com/q?s=^DJI

Dow Jones Industrial Average

(DJI: ^DJI)

Index Value:	10,567.43
Trade Time:	3:43PM ET
Change:	575.70 (5.17%)
Prev Close:	11,143.13
Open:	11,139.62
Day's Range:	10410.61 - 11139.94
52wk Range:	10,403.80 - 14,280.00

Quotes delayed, except where indicated otherwise. For consolidated real-time quotes (incl. pre/post market data), sign up for a free trial of Real-time Quotes.

With payout:

Bank:  I give you money.  You do stuff.  Wheee!
People:  Yay!  I get money!
Bank:  Yay!
People:  Oops, that didn't work out.
Bank:  Oh noes!  I need money now!  Government save me!
Government:  Here you go little bank.  Take this money and keep going.
Bank:  Whee!  I get richer and richer!  Government can I have more money?
Government:  Sure, why not.
People:  w00t!  Glow in the dark sunglasses FTW!

Without payout:

Bank:  I give you money.  You do stuff.  Wheee!
People:  Yay!  I get money!
Bank:  Yay!
People:  Oops, that didn't work out.
Bank:  Oh noes!  I need money now!  Government save me!
Government:  F!$% off.
Bank:  OH S%@^  Guess I can't keep making these super risky loans.  Nuts.
People:  Aw, I can't make my glow in the dark sunglasses now...

But the Dems were the ones who were widely supporting it... and the republicans who were widely against it.

I though the republicans were the ones who wanted to destroy the middle class.

Apparently not, since the DOW just shit all over itself.

Don't worry guys, it seems the vote doesn't matter:

Fed Pumps Further $630 Billion Into Financial System

Because we are being doped by congress. It's bad, but not The Great Depression bad. In the great depression, 40% of all home loans defaulted. Right now we are at 4%. In the 30's we did not have FDIC, so most people lost there entire life savings. That can not happen today. Not all banks have stopped giving loans. It's only the ones with questionable lending practices. Most local banks are operating normally.

In fact, I tried to get a loan the other day at my bank, and it took 3 days because the loan officer was so busy (I then got the loan). They were busy because due to there quality lending practices, the are still going strong.

If you don't bail them out, the Banks that did the right thing are rewarded. If you do, the one that loaned money to anyone to make a quick buck are.

Guess which banks lobby congress ;)