$700 Billion Bailout: Long-term Solution or Inadequate Quick Fix?

If you're like me, you've probably been wondering how exactly to feel regarding the proposed $700 billion financial bailout currently being debated in Congress, especially after hearing both presidential candidates during last night's debate suggest that the increase in spending won't necessarily significantly affect the kinds of programs they will try to implement if elected to office. That notion didn't make much sense to me, until I read Bill Gross's explanation as to why taxpayers may not get stuck with as large a bill as one might expect. In fact, according to Gross, chief investment officer at Pimco, the U.S. government would likely turn a profit in the deal. Assuming the government purchases the distressed mortgages from banks at a discount to what the mortgages are worth, when these mortgages are eventually resold or paid down in full, the government would reap the difference. However, there is still much debate on the issue, as this article in Grist reflects. Skim down to the blog comments at the end for a very entertaining read.