By now, you probably would have heard of the $700 billion bailout package being proposed by the Federal Reserve and the Treasury here in the US. (If you haven’t, the proposal is for the government to purchase illiquid securities from financial institutions whose values are not well-defined and whose value may continue to decline if homeowners continue to default on their loans. It is, obviously, much more complicated than this and there are tons of articles floating around the Internet that would probably do the problem a bit more justice.)

Whenever the government spends, though, the taxpayers are the ones who ultimately foot the bill. And here lies a central question to the proposal: should the taxpayers pay for the missteps and problems created by the financial industry? Clearly, $700 billion is a lot of money and you can imagine the polarization being caused by this.

Let’s imagine what could happen if the proposal does not go through. On paper, these assets are not particularly valuable (many have argued that banks are carrying these securities well below market value because of strict accounting rules), so banks have a limited amount of capital. This means that banks could be more reluctant to give out loans (which are essential for businesses and individuals alike), unless they felt confident that they could get the money back and with a good return. As a result, there could be even less money exchanging hands and the economy could continue its turbulent slide. So, the taxpayers would not have some questionable assets to worry about but, instead, may have to worry about their jobs and about mounting financing problems. The picture is bleak to say the least.

If the proposal does go through, then there are a couple of possibilities. The government could manage to sell the securities after the markets rebound and make a profit. This would make the government look brilliant and will come as a huge relief to taxpayers. Or, the government could take a loss and, eventually, the taxpayers will feel a pinch. The question becomes, then, at what price should the government pay for these troubled securities?

Suppose that the government low-balls them and offers pennies to the dollar. This would protect the taxpayers, but will not provide enough capital to the banks that are responsible for making loans and creating liquidity in the markets. And if the government pays a handsome price, taxpayers will likely lose out since the government will have a harder time turning out a profit.

It is quite a challenging problem. There are a lot of smart people at work trying to find a solution. (Isn’t it ironic that a lot of smart people were responsible for creating this mess?) I feel that there will definitely be a bailout, and the heart of the matter is the price at which the government will buy the securities, and what sort of conditions (like limited executive pay) will apply to firms who take advantage of the offer. To leave the markets the way they are would be extremely irresponsible and will jeopardize the short- and long-term growth of the economy. I also think that the government will pay a good price for the securities; if the government were to be cheap, it really wouldn’t be injecting much money into the economy and that would not help the situation much at all.

I should mention that this is not the first time that the government has intervened (again, at the taxpayers’ expense) in the financial markets. (The US government did it for Continental Illinois Bank in 1984, and for the airline industry in 2001. Oh yeah, and let’s not forget Freddie Mac and Fannie Mae. Or Bear Stearns. Or AIG.) I should also mention that this will not cost the government $700 billion; that will only be the case if the government does not attempt to or is unable to sell any of the securities it buys. That’s like buying a 70 billion lottery tickets and winning nothing.

Chances are that you will find yourself on one side of the fence. (It’s hard to say that the government should maybe bail out the troubled financial institutions.) What is it going to be?

I’m not sure how Google’s PageRank technology works exactly and, despite my best efforts to monitor and improve the placement of this site on Google searches, I am having some difficulties in finding a solid pattern.

Ever since I re-committed to doing this site and did the facelift, I started to pay more attention to where Google listed it when I searched for it using “Justin Chan” and “liber dei.” For the former, I started off somewhere around page 14 of the results and chances of getting hits from that result would be quite low. (I will have to admit that I helped myself out by clicking on it a couple of times!) For the latter, the site was ranked first. (Yay!)

Since then, however, I have started to use Google’s Webmaster Tools to encourage more favourable search results. Today, I noticed that a search for “Justin Chan” listed this site on page 5. A subsequent search placed it on page 4. Yet another search yielded a result on the third page. (I just checked again and it’s back on page 5. What the heck?)

Like I said, there doesn’t seem to be a clear pattern for this PageRank business. I’m quite sure that the algorithm has some rhyme and reason to it but, at the moment, it is currently rubbish to me.

In any event, I am a little curious and this leads me to the following questions:

Where does this site show up in your search results?
And have you tried Googling yourself?
Is it weird to Google yourself?

Update: It appears that I’m on the front page of Google! Yay people searching for “justin chan” and clicking the site! I guess better indexing helps, too.

Today, I have been a “spud.” (You can thank my recent interactions with a host of people from England for that one. Their lingo has been all but reinforced given all of the Top Gear that I have been watching, too!)

Maybe it has something to do with my first named storm bearing down on the city all day today, or maybe it has to do with how exhausted I have been all week. (I have been sleeping quite poorly for a couple of weeks now, and I’m not sure why… I’m not stressed out or worried or anything. Perhaps my new, brutal gym regiment has something to do with it.)

This, however, has started to get me thinking about how I make use of my time in New York. On one hand, I have been in the city for well over a year (combined), so I have done a lot of the touristy things and have seen much of the city. Maybe it is reasonable for me to be settling down into a routine and doing the same sorts of things on a day-to-day basis (with exceptions on weekends, of course). On the other hand, I’m in New York City! I mean, people would contemplate killing to be here! (Maybe not. Hopefully not.) This is a city that never sleeps, and there is just so much to do. Am I squandering my time here?

Maybe I don’t know enough people here. There are the people at work (most of whom live in Jersey.. boo-urns!), a handful of Waterloo grads, my roommates, and that’s basically it. It’s ironic that, in a city as big and populated as New York, I don’t know more people, isn’t it? Or maybe the density overwhelms me. Or maybe it has something to do with my being a big chicken.

Yep, you heard it here first folks: Justin Chan is a big chicken [potato].