Asian Americans Consider Bailout Plan
September 25, 2008
While details are still being worked out on a suggested $700 billion federal bailout plan for the nation’s troubled economy, the Asian American community holds mixed views about the proposal.
The Bush administration’s original plan, still under discussion as of press time, would give Treasury Secretary Henry Paulson the authority to use taxpayer money to buy up to $700 billion in virtually any kind of bad assets and then buy, hold and sell the assets in any way he sees fit.
Irene Yee Riley, the former president of the Association of Asian American Bankers believes the Bush administration’s plan would be good for the country, helping build confidence in the economy for consumers, thereby encouraging them to continue to spend as normal.
Leon Chow, chairperson of the Chinese Progressive Association, believes otherwise and opposes the bailout.
“The general consensus of my constituents, working-class Asian families, is why do we have to keep bailing out failed businesses and these large corporations?” said Chow. “I work with a lot of new Asian immigrants who have not yet achieved their American dream, they are still struggling… and it’s unfair for them to have to share another huge cost of the failed Bush administration.”
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From a financial standpoint, President of Leading Edge Investment Advisors Clayton Jue said a bailout plan is absolutely necessary to stabilize the financial and credit markets.
“Without this, business and investment activity would continue to decline and ultimately could cause a downward spiral in the economy leading to massive unemployment and more home foreclosures,” said Jue, who is also a board member of the Association of Asian American Investment Mangers. “Government intervention is probably the only chance that homeowners with troubled loans have in order to hold on their property and for the housing market in general to recover over the next few years.”
He said the proposal has its pros and cons, however the consequences and full impact of them are difficult to predict.
“The only certainty is that we can predict what will happen if there is no bailout,” Jue said.
From the banking perspective, Eleanor Chang, senior vice president and marketing director at United Commercial Bank, said she does not think the Asian community and its homeowners will be affected or in danger of foreclosures.
“The Asian community works hard to save money, typically only buying things they can afford,” said Chang. “They tend to put a lot of down payment and pay off their loans quickly.”
President of the Chinese Real Estate Association of America John Lee said the bailout plan would be beneficial to homeowners.
“Home prices have been dropping, and without any loan options, there will be fewer homebuyers and less demand, decreasing the value of your property,” said Lee.
Lee notes, however, that Congress and the government need to ensure that taxpayers do not end up putting up the funds for the bailout, otherwise “people will figure out a way to take advantage of the system again because they do not carry a proportionate risk,” he said.
Susan Au Allen, president of the United States Pan Asian American Chamber of Commerce said, “the devil is in the details,” and it is too early for her to take a stance on the proposed plan, as details are constantly changing and not yet finalized. But she notes that if taxes are raised, it could potentially affect small business owners.
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3 Responses to “Asian Americans Consider Bailout Plan”
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Most of the world doesn’t know about the 65 Trillion Dollar Credit Swap Defaults still looming. It dwarfs the mortgage crises.
It is on http://coinage.me.
where the flaws are articulated in detail unlike anything you see on the news, and a detail solution is provided to fix the foundation. Which everyone else seems to lack.
700 billion dollars bailout proposal sounds good. But on close examination, many questions remain.
Would it be enough to solve the problem of still looming
defaults in the credit markets ?
Why taxpayers (especially the coming generations) have to pay for the mistakes and largesse of manor financial institutions for their greed and recklessness ?
Who will have the oversight and control of this huge amount with authority, clarity and efficiency ?
Under the current system which favors big capital over
small enterprises and individuals, what new laws and
new regs will be instituted to prevent repetition of loose, outdated supervision plus outrageous compensations for
financial sector senior execs ?
Can excessive greed be tamed ?
How deep is the hole in terms of total amount at risk should the credit crisis worsen ?
700 billions dollars ‘bailout” is bailing out the rich at the
expenses of the poor.
No doubt about it.
Under the pretext that when the big ships sink, the small boat will sink also.
Now we are winessing capitalism at its worst.
The reckless gamblers get rewarded through “rescue” while the powerless prudent savers get punished and have
to shoulder the gambling debts.
The US has been living over its means for so long that
national treasury depends on foreigners’ mercy to send
in their savings to pay for all the gigantic expenditure including costly military adventures abroad. China and Japan are the main “donors” (creditors, i.e.) to buy our
T-bonds ( Trash bonds ?).
Is it sustainable ?
What if they stop buying any more but turn to selling instead ?
We print more waste papers to fill the gap ?