Legislators in Washington are working to negotiate a bailout for the swooning financial industry. What does the financial turmoil mean to you? How has it affected your life? Here's what experts in a few different areas say.



"Because of (Fannie Mae and Freddie Mac) guidelines, it has gotten increasingly more difficult to approve a mortgage. People who were well-qualified are not qualified today because of liquidity issues on Wall Street."

The guidelines have been tightened and require premiums on mortgages that aren't stellar. "A year or two ago, they wouldn't have these issues."

Fannie Mae and Freddie Mac decided to charge higher prices to people who aren't in the upper 10 percent of the market.

- Mortgage premiums can cost tens of thousands to hundreds of thousands of dollars over the life of the loan.

- A lot of people think real-estate values will jump back up, but it's more likely they will level out for a while.

- 2009 will see the resetting of interest rates on a lot of adjustable-rate mortgages. Unless the interest rate is down to something very manageable, you're going to see more foreclosures.

- A bailout would help the bond market, which would drop interest rates, and more people should be able to refinance.

George Hanzimanolis, past president, National Association of Mortgage Brokers


"When there is a tightening in the credit market, that puts a strain on banks and their ability to lend. Banks aren't borrowing or lending money to each other anymore, so there's no way for banks to raise capital."

Almost 50 percent of credit-card loans are funded by selling the debts to investors. Right now, the ability for banks to secure funding is really difficult.

- The use of a credit card is, in effect, a loan. Card issuers are less willing to take a risk right now.

- Downward pressure caused by a tightened credit market is causing some card issuers to scale back on available credit.

- There is similar pressure on auto loans, but change there is less an effect of the credit market than the effect of the economy — high fuel prices and job losses.

- We probably will see tightening in auto loans, also.

- People who are good risks still can get credit.

Peter Garuccio, spokesman, American Bankers Association


"Working people should be very concerned about the turmoil in financial markets. Wall Street's troubles are Main Street's troubles because they threaten the economic health of manufacturers and the 14 million American workers we employ."

The National Association of Manufacturers is urging legislators to act quickly and decisively on a response to the crisis before adjourning for the final weeks of the election campaign.


- If America stops making things, the country and the economy are in serious trouble.

- Manufacturers also are concerned about the impact on employees and their families, as well as individual investors and pension plans, who all rely on a secure and stable financial system.

John Engler, president, National Association of Manufacturers


"This financial turmoil should be looked at as an expected, albeit distasteful, bear-market situation that comes every once in a while. Historically, this means on average of one out of five years."

It may seem like "this time it's different," but that sentiment is the most common thread that one can find in all bear markets. The truth is that corrective measures will occur and recovery will happen. It will not be predictable, but it will occur.

Visualize wearing a wristband that says: WWWD (what would Warren do). Warren Buffett that is. He is buying like crazy in this market and so should the IRA and 401(k) investor.

- Look at these time as a buying opportunity.

- Market declines become losses only when you panic and sell.

- Short-term volatility is the price of long-term growth of your portfolio.

- IRAs and 401(k)s are long-term investment vehicles, not day-to-day trading accounts, and as such the owner should disregard all the "noise" going on in the media. What's happening today will be a blip on the radar to someone retiring 10 years from now.

Financial advisers Andrew C. Orr, Orlando, Fla.; F. Dennis De Stefano, Maui, Hawaii; David I. Barnett, Tustin, Calif.


"The big thing has been spending power. Consumer discretionary spending power has been sapped away by higher energy costs and higher food costs.

"It has affected not only consumers, but the retail industry."

Lower spending by consumers "is having a drastic effect on our industry."

- Rebound is a matter of when and how long this economic cycle is going to last.

- Retail also depends on a turnaround in the housing market.

- Anything that affects the economy — consumer wealth — affects the retail industry.

- Retailers make adjustments any business would make — trying to cut operating costs, manage inventory, cut labor and technology costs.

- Consumers are focused on necessity items and are less likely to buy big-ticket (big-profit-margin) items such as a television.

Scott Krugman, spokesman, National Retail Federation

The Canton Repository