Letters to the Editor
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wall street and people
As usual, ordinary people suffer while the people who engineered this trouble get a walk. Okay, let them. We don't have to punish them. But could we please put something in place going forward that works and takes care of those who are just trying to make a living? Perhaps we could begin if those who have so long profited from the big casino of the market realized in what general contempt they are held.
Excessive wealth will shortly become, for most of us, the sign of a diseased being. In some cases this may not be fair, but it will happen. (Of course, excessive poverty for millions upon millions has long been considered fair.)
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ABAB - socialism
So, when the government bails out newly poor (i.e. middle class people who lost their jobs), it isn't socialism?
I've never heard a free-marketer say that. I have heard them say the poor deserve to be poor. "They didn't/don't work hard enough."
Those many instances of the government bailing out corporations - is that "free market" at work?
Be careful how you answer. If yes, then helping poor people is also free markets at work. If not, then free markets don't work.
Your move.
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Bryan Hayward
Clearly you're trying to bait me into saying something. Go look in Wiki if you don't know what 'socialism' is. Bailing out corporations is not that.
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Mr. Angry Bees
I use the term "socialist" the way the folks at the Wall Street Journal and the Rupublican National Committee and the National Review use it: any government intervention in the "free' market they endlessly decry as "socialist." And I stand by what I said. The folks in the Investor Class will be demanding government interventions in the market in the form of non-Friedmanite Fed actions, changes is rules and regulations, and direct bailouts if necessary to save themselves from their own stupid financial products markets. They will demand that the government "do something" about their slumping stock values, in a way that when workers demand the government "do something" about the offshoring of their jobs, these same people mock and deride. Again, they always want to privatize thier gains, and switch the pain of their losses to somebody else, while preaching the need for tightened belts to workers who make a fraction of what they do and Third World countries swiming in poverty, disease, and ignorance.
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It's not canarys, it's chickens
It's not canarys; it's chickens coming home to roost. This disaster has been in the making since the election of Ronald Reagan in 1980. The Republican Party convinced the majority of American voters that 1)rich people did not need to pay taxes and 2)the markets would regulate business. Neither is true.
Each generation of Republican dominance results in reduced taxes on wealth, a concentration of capital in a very few hands and a business climate that invites unscrupulous investors to game the system. We have had watered stock, trusts, holding companies, S&L scams and pyramid schemes in the past; today we have hedge funds, sub prime mortgages and private equity buy outs. The causes and effects are substantially the same.
I suspect the only thing that has been keeping us out of a severe recession (depression?) for several years now is the huge federal deficit.
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someone please explain--why the bailout?
The Economist in December had this nailed pretty well--we're screwed. Without a coherent plan (this Congress and Administriation is completely incapable of planning anything) out of sub-prime the entire financial sector goes splat this is due to two reasons:
- Fear--without a coherent definition of what the sub-prime mess is and who are the big losers investors will act out of emotion and cut off investing in anything, call in their margins, etc.
- Failing to eat their own doo doo--by bailing out ANY financial firm the fed is underminining their own line of BS that they have spewed for the last 20 years--namely, that wall street is perfectly capable of self-regulation and that the "market" will weed out deceptive and slimy products. Ha. What a load.
So, here we are, a short three months later and the whole thing has cratered. My question is why? Why bail out anyone? Let these firms go down in flames--wouldn't that at least get the suffering over with ASAP? Instead they drag down the dollar along with their pals second home's in the Hampton's--why should we give a sheet?
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American Middle Class
I suspect the only thing that has been keeping us out of a severe recession (depression?) for several years now is the huge federal deficit.
That's true for your average American family, too. The only reason that the middle class has been feeling so confident, is they had plenty of money to spend from their ATM homes. Many did not see this as "debt".
The consumer has kept the US economy propped up through massive debt, too.
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The Greenspan crisis?
In the reporting about this awful mess when people are losing their houses and retirement investments are melting to nothing, I found very little pointing out that the man who was in charge while the sub-prime bubble was being created was nobody but Greenspan himself. It is not like the man is dead, for Pete's sake! He continues to emerge regularly, the latest to tell us that it was the worst financial crisis since WWII.
Well, thanks, we'll name it after you as you did very little during your Fed Chairman time to control what was happening! having shown your gross incompetence, why don't you just crawl under a rock?
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Stock market questions
Here's a pattern I've noticed in the past year and it puzzles me. When some economic crisis hits the US, like the BS-storm, foreign markets take the news much more seriously than we do in the US. The Hang Seng droped over 5% yesterday, and the DAX nearly 4% today. In the US, after a low opening, the DOW has been climbing all morning. Why do foreign markets always react more dramatically than American ones to American economic woes?
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Andrew...whadaya think of this?
as you can imagine if you follow Jim Kunstler's blog, his commentary today has a certain darkly smug quality. I noticed this paragraph, and I wonder what you thought of it, Andrew:
"Over the weekend, the Federal Reserve engineered a $30-billion dollar Saint Paddy's day present for the JP Morgan bank by handing them the corpse of Bear Stearns. The object of the game is to prevent the "assets" of Bear Stearns from going to the auction block, on which they would be discovered to be nearly worthless, which would instantly render all similar assets held by the other big banks to be similarly worthless, and would result in a universal margin call that would pretty much unwind the hallucinated "wealth" acquired the past ten years."
Read it all here: http://www.kunstler.com/
If Kunstler is right, the Fed-aided buyout of Stearns by Morgan was nothing more than classic hustle. Rich guys at the Fed bailing out their rich friends not only at Stearns, but at every other investment bank that sought to profit by buying and selling worthless sub-prime backed securities, and engaged in reckless and irresponsible..and basically nonexistent "risk-management."
the Fed should let them ALL go under..then sort it out. Instead, we're all going to be in hock up to our eyeballs, indirectly, through the federal budget, to support past profits for a few fat cats. Sweet.
Privatizing loss..socializing risk. Only in America.