Call me old-fashioned, but I believe you reward good behavior and punish bad.

The AP got it right, my CD is earning about 2%, my savings just over 1%, and my checking, fuggedaboutit.

This is all a result of the reckless behavior of the few, at the expense of the many. When will government learn?

Exactly how I have felt since this the late 90's, and more every day.

There is literally a war on savers. Our system encourages and rewards excessive, irrational consumption!

I feel more despondent and hopeless every day....

"There is literally a war on savers. Our system encourages and rewards excessive, irrational consumption!"

I don't know if it is actually "true" however; I feel the same way Darwin Rules does.

It seems as if our entire economic system is propped up on the allowance of companies to seduce and persuade Americans to buy too much because "they deserve it" and let the debt ride.

I've never understood it but, I guess that's way I'm stuck in an apartment paying rent.

Yeah, I've gotta say, I feel the same way. My wife and I have been saving for years, and been horrified by the way things have gone. We've been losing money to inflation and puny interest rates, meanwhile, housing prices are not anywhere near where they were before the "bubble" occured. Meanwhile, every available lot has been built on (often with absurdly expensive, venal, cheesy plastic-shuttered corporate con-job McMansions). Shouldn't, one might ask, there be some connection between home prices and income levels?

We're hardworking, well-educated people that want a good home for our kids and (not trying to start any arguments here) decent schools. In theory, most communities might reasonably welcome people like us - but in practice, most communities were happy to let developers run amok through this whole mass delusion, and public policy has been either bailing out or protecting EVERYONE else (investment banks, over-extended buyers, "semi-public entities", home builders) but us.

Darth,

You said it so well. Touche. I know it's no comfort, but we are in the exact same boat. It seems the government has sympathy for everyone but us, not that I ever wanted their sympathy. And we are the very heart of this country.

Just another vote for the AP article. Everyone from the corporate level down who gets on the stupid train and gorges themselves on borrowed cash until they explode gets bailed out. All of us regular joes who balance our checkbook and live responsibly get burnt.

Hmm.

Well, I think this "war on savers" will be a short(er) term issue. One of the real concerns would appear to be the rising of interest rates, due in no small part, to this "bailout" of FNM and FRE that is all but inevitable at this point.

So savers, you have that to look forward to. Be careful what you wish for, though. Eliminating those players, as corrupt and deserving of it as they are, will create a giant hole in mortgage finance. The US government nationalizing their debt will increase the US debt accordingly, with the increase being on the order of 50% (if they do it the way it should be done, from an accounting perspective, the way they require companies to manage their balance sheets). $9,000 Billion dollars in debt jumping to almost $15,000 Billion.

I saw somewhere an estimate that US government debt ratings could drop from AAA to AA on that move. Wish I could find that again. THAT alone will increase interest rates, to help compel the Chinese, Japanese and every other nation that "saves" their money in US government debt (for whatever reasons, those aren't relevant to my point) to continue holding that increasingly worthless paper with decreasing chances of being paid back.

Buck up, savers! Your time's might be coming.

Khyron (33 yr old saver earning paltry rates on 20K in an online savings account).

It makes me think of that Discover card commercial that's out now: "We're a nation of consumers, and there's nothing wrong with that."

Um...maybe there IS something wrong with that...

My husband and I are both educated, have good careers, and would be considered by most to be upper middle class, and we can't afford a decent home in a decent area because of this bubble. Until the prices drop accordingly we'll sit in our small apartment and keep earning our lousy 3% interest (I'm with you Khyron!). I hate seeing these "bailouts" and my ING rate dropping, and knowing there is nothing in any of this for us. Where is the govt's help to get responsible families into homes they can TRULY afford?