Commonly referred to as “the bailout bill,” the passage of the Stabilization Act represents gov-ernment’s effort to improve the financial markets by purchasing troubled assets, mainly mortgage-backed securities such as sub-prime loans.

U.S. Treasury Secretary Henry Paulson said the intent through those efforts, which will be con-ducted through the Troubled Asset Relief Program (TARP), is to purchase the troubled assets of financial institutions, up to $700 billion, in an effort to help stabi-lize the nation’s financial market.

The bill was enacted Oct. 3 de-spite opposition from members of Congress.

Among those who voted against the bill was House Repre-sentative Phil Gingrey-R.

“One of my biggest concerns about this bill was that it focused more on relieving the symptoms rather than address the underly-ing disease that caused this finan-cial crisis,” Gingrey said. “We must ensure that when these troubled institutions get back on their feet, they are not allowed to implement the same irresponsi-ble lending and investment prac-tices that caused this mess.”

Since the “financial crisis” was disclosed in September, econo-mists, political pundits and aver-age citizens have been struggling to gain an understanding of how things took a turn for the worst in a relatively short time.

“There were some bad deci-sions made,” said Veda Hilton, President and CEO of Etowah Valley Federal Credit Union in Cartersville. “This is a crisis of huge proportions.”

While several banks across the nation are experiencing hard-ships related to the economic spiral, credit unions are faring much better.

“It’s almost like it’s giving us a lift as an industry,” Ms. Hilton said. “We don’t want to say any-thing to diminish the banks, but as this crisis continues we will see credit unions grow.”

Credit unions make up only 6 to 7 percent of the nation’s finan-cial institutions but since they are federally regulated and are owned by its members, they continue to be unscathed by the subprime loan problems, said Heidi Isom, Marketing and Business Devel-opment Director for Etowah Valley Federal Credit Union.

“That little six to seven percent is a safe harbor right now,” Ms. Isom said.

Since credit unions tend to be more “conservative” in their lending, they have virtually re-mained untouched, Ms. Isom said.

According to the National Credit Union Administration, Georgia credit unions typically hold on to the majority of their mortgage loans, typically 70 per-cent, rather than bundling them and packaging them as assets to be traded on Wall Street.

Because they’re not publicly traded stock, there’s no incen-tives and no profit to be made, Ms. Isom said.

“That’s your power as a con-sumer,” Ms. Isom said. “When you operate under a nonprofit model, you operate differently.”

But Ms. Hilton isn’t suggesting that residents head to local banks and empty their accounts.

“You’re not going to lose your money,” Ms. Hilton said. “Your money is insured so you won’t lose it regardless of what happens to the market.”

Richard Drews, CEO of Cen-tury Bank of Georgia on Main Street in Cartersville also issued reassurance that local banks will weather the storm of the current economic troubles.

“Things will not turn around over night but our economy will rebound,” Drews said. “In Car-tersville and Bartow County, we are particularly blessed. While our real estate market has defi-nitely slowed, people continue to move here every day. Our loca-tion, our climate, and our eco-nomic diversity will continue to ensure us a bright future.”

Century Bank of Georgia, like other community banks across the county, has also weathered the financial storm that has swept institutions across the country.

Drews said the excesses of the mortgage market caused by too much “cheap money” being thrown about by investment banks altered the natural supply and demand for houses.

“Community banks as a rule did not get involved in this,” Drews said. “For instance, in the case of Century Bank of Georgia, we made no sub-prime mortgage loans and we owned no Fannie Mae or Freddie Mac stock.”

While credit unions and com-munity banks are far removed from the troubles shackled to other financial institutions, Drews said the finance industry as a whole is still impacted.

“All financial institutions are impacted by the financial crisis, though,” Drews said. “Every institution has customers that have lost their jobs, lost money in the stock market or been other-wise impacted by the downturn in the economy.”

But confidence in the nation’s financial system has been se-verely shaken and in hopes of restoring that confidence.

“We live in great country and we have a resilient economy,” Drews said. “Things will get bet-ter. It is easy to get lost in the 24 hour news channels and get over-whelmed with constant bad news. One might believe that every house in America was fore-closed and no one was paying their mortgages. But that is cer-tainly not the case.”