My only thoughts on this financial crisis,
I think that Bushy is pulling another fast one with all this it’s a calamity, “we have to take care of it now, we have an impending disaster” stuff.
Yes, I have a thousand tongues,
And nine and ninety-nine lie.
Though I strive to use the one,
It will make no melody at my will,
But is dead in my mouth.
McCain is the great stunt puller, he did it in Iowa, and he did it during the hurricane, and though what he does is not always wise it sometimes works from a political standpoint. Nothing has convinced me more of his total self interest than this last stunt, but then again from the standpoint of his campaign I’m sure the thought is ” who cares as long as it works politically”.
McCain is like a little nuclear reactor set to be dropped on a city at the time of day it is most populated.
Obama’s job is to look disdainfully at McCain and roll his eyes and say “not again”, while wondering why it’s so hard to get the other candidate to realize the presidency requires more than just small doses of histrionics and a lot of well planned outrage.
Dodd – Dem, and Stearns – Repub, both say whoa …slow down, we can’t do this in a rushed frantic way, or basically the people may end up more screwed. You know like they were with that war you presented in a similar way.
As little as I know about this situation I wonder why we are considering favor of buying distressed assets instead of just insuring them? Mr. Paulson said it was quicker and more efficient, but I wonder how much the fact that those like Buffet have already bought into the distressed companies — specifically because they were certain the 700 billion bail out will go through — has to do with it?
They aren’t bailing out homeowners who bought mortgages from banks full of opaque rules and cooked books in a false housing market the banks helped create. Why is Wall Street always protected and why should one man be at the helm of all this?
I like this comment from Jim Wells at the Beckner— Posner blog because it follows my line of thought.
Perhaps we should put together a group of knowledgeable citizens who actually have the interests of the country at heart and haven’t had their beak at the public trough all their life.
I have an idea that the guys you get to run it aren’t going to require $700B
In my opinion unless we get the resolution away from these experts and politicians we are going to have a real disaster.
—
A learned man came to me once.
He said, “I know the way, — come.”
And I was overjoyed at this.
Together we hastened.
Soon, too soon, were we
Where my eyes were useless,
And I knew not the ways of my feet.
I clung to the hand of my friend;
But at last he cried, “I am lost.”
Poetry by Stephen Crane. Title, the words of Pink Floyd. (“Money”)
The proclamation of the wall street mushroom cloud, a dubious crisis.Something is not right here with this rush to judgment. Called by some “The Mad Rush to Judgement:. I agree.
At first the crisis infuriated me. Now the whole reaction to it is infuriating me.
Makes you want to put your fingers in your ears and sing la, la,la, I don’t hear you.
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The really crazy thing is that anyone who has been paying attention should have seen this coming more than a year ago. Yet Bush, Paulson and Bernanke put a few bandaids on the gaping and festering wound and assured the public that things were just fine.
The situation exposes the big lie about the efficacy of unregulated markets, yet no one seems to be holding conservatives to task over that … at least not in the big media.
If I were the dems in Congress, I would never sign off on any solution proposed by the Bush administration, no matter how dire they portray the situation. Let’s call their bluff and see what happens.
These markets are NOT unregulated. And in fact, McCain and other GOP congressmen were complaining about FannieMae and FreddieMac as far back as 2003. Others, such as the noted business-friendly American Enterprise Institute, warned in 1999 of this very thing happening: http://snurl.com/3uco5
In 2003, the Bush Administration pushed for greater oversight of FMae/FMac, and Barney Frank shot it down: http://snurl.com/3uctp
“These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”
There’s more than enough blame to go around, and both parties deserve to be spanked. Culturally, the fault belongs to US: http://snurl.com/3ucxa
Yes I think that indeed there is much more than meets the eye much of it beyond my scope of reading I am supposed to be doing grad work is something beside economics or financial markets but there is certainly enough blane to go around, indeed where was the regulation that was supposed to be much like the immigration policy we already had but never bothered to uphold. Which is why i Prefer Mr Wells Idea.
$700B is not the final cost. It may end up being less, and there’s a chance the Feds may make a profit.
The issue here is that many assets on paper have become fractured and tangled with other assets. Bad sub-prime loans got bundled with a bunch of others, and with all the groceries tossed into the same mulligan stew it’s hard to know what reeks of putrid and what is safe to eat.
The Feds are going to buy off these batches of mulligan stew, and start sorting the components. Pieces of this mortgage note will be reunited with the other fragments, and these index funds will go into their own bin, and the like.
Once the carrots and the peas and the corn and the okra and the tofu and whatever the hell else is in there gets tagged bagged, they’ll go to market with them. Mark Cuban has proposed putting it all up for an eBay-style auction. Ultimate in transparency.
There’s a chance that the transparency will reveal real values, and most of those instruments will fetch their proper value in return.
Even if the taxpayers end up eating a $50B loss on paper, it will go a long way to shore up investor confidence, that these Gordian bundles have been sliced and diced.
…to mix more than a few metaphors.
I don’t know when I see that Buffett just bought into i think Goldman Sachs and Morgan before the bailout, saying he bought in because he expected the bailout I wonder how much of this is going on on a lesser scale with people of wealth and I see something wrong here.
I’m sick of these panics and am waiting for them to start issuing financial alerts much like the code red alerts they issued after 9-11. Just to keep us on our feet, and good and scared.
The lesson of the past eight years is that whenever George W. Bush says that both parties need to come together and get a bill to his desk ASAP, there’s some serious bullshit afoot.
More distressing is that this bill was drafted in advance as a wish list, much like the Patriot Act.
John McCain has accused Obama of playing the crisis for political advantage. Now he wants to use it as an excuse to grind the campaign to a halt at a time when he’s bleeding points in both national and battleground state polls.
This will be an interesting couple of months
McCain sort of goofed up this last time it made all his previous political shows more obvious.
Bush has a lot of nerve to come on the television and try to scare up to death, he really should have sent someone credible.
I think Bush’s scenario is like the boy who cried wolf. This time there really is a wolf to be worried about. (TOO MUCH DEBT. DEPRESSED ASSETS. Devaluation of key assets with inflation of consumer staples like food and energy.)
I don’t like the idea of this bailout. We buttress these baffoons of Wall Street because they got into such complex deals based on throwing money at any sucker wanting a mortgage. (Alan Greenspan, where you at? You’re to blame too.)
I do expect the gov to take an equity stake in all these jokers’ banks. (Warren Buffett did with Goldman Sachs, guaranteed 10% ROI. Must be nice to make $500 million off what was the ‘Gold standard’ of Wall Street.)
Which reminds me – Paulson, CEO Goldman, Robert Rubin, Clinton’s top money guy, Goldman boy. Governor John Corzine of NJ, another one in that click. (It’s a Harvard v. Yale fraternity mixer on da Street. We aren’t invited, unless your a cute college co-ed with no sense.)
I gave my solution: put all these money grumbers in a room daily from 1PM to Midnight to “work out” the bad money they sent around. Top 20,30 or 50 banks. Mortgage giants. Insurers. Fucking credit card entities that suck Americans dry without the reach around to the backside.
Give them 1/5 or 1/7 of that 700 Billion. Fix some real problems. Actually give a fuck about an American worker. Try to solve underlying problems in tech/industry/energy that could generate the real stability.
Enough pushing paper around. Or making fucking retail, service and government jobs (which are totally useless for development) the staple of this 21st U.S. Economy.
I mean, it is nice some have skills to pay bills, but millions of factory workers, auto workers, and undereducated folks are pushing a rock that will eventually crush them.
I’ve just read so much information on this financial crisis, over the last week, my brain can’t take it any longer.
This is exactly what I have been saying! Let the banks fail. We could take that 700 billion and create a public sector credit union service. Think about it. That could be done for pennies on the dollar and it would solve our end of this problem.
Even if you don’t agree with that, panicking is not going to help anything. People need to stop and think.
I think we could do better but I don’t think we can let them fail to that degree with out more of a consequence for most of us than we would be able to live with.
I like your thinking. The problems with Mr. Wells suggestion as I see it are two: I don’t know where to find wise people with the country’s interest at heart in the first place and in the second place, they would either have to be elected which would make them politicians or they would have to be appointed by politicians. Maybe you and Mr Wells could do it?
Oh, and I agree with Wombat. I believe we are in a time of crisis. I admit that government will have a big role to play in damage control. I don’t believe a thing that comes out of the President’s mouth.
We at least agree on one or two things,..phew..
Surely there is a cynically poetic man, with a couple of dogs, somewhere on the west coast who could be trusted. ;)
The more I read and watch on TV the less I understand. I have never felt so conflicted
I know too many people in their 50′s who have lost most of their retirement plans not to want them to be helped. They shouldn’t have to work until deep in their 70′s to make up for the losses, unless they want to—that is if they’re not laid off, demoted or forced out otherwise
Yet they’re usually the first people not to want a government bail out
Conflicted, contradicted, upside down and wow, it’s like wonderland all over again.
As you can tell I’ve been driven partially crazy while trying to wrap my head around all this.
It becomes more confusing every day, which I think is the purpose. I see the Republicans now want to tab on some capital gain tax breaks. I think not a good time knowing our deficit is so humongous, but leave it to them to try to squeeze out a little pocket money for their huge cooperate backers.
A few good men? Novel idea if we can find them. As the gentleman above said, where is the wisdom? Crane’s poem says it all.
Brilliant use of Stephen Crane’s cynical prose by the way.
I figure I’ll stop reading about it for a couple of days in hopes they all go home and get some sleep on my dime, like they do everything else.
I just heard my bank (WaMu) is going under too. That’ll be the third time my bank account will have shifted to a new bank since I opened it. That’s a sad track record for only fifteen years.
yikes, I saw that this morning mr mojo.
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