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Monday, September 22, 2008

Cousin Jim says ix-nay on the ailout-bay

Deep suspicion and skepticism about the Bush administration's rush-rush bailout plan are not just a partisan matter. Check out what Cousin Jim has got to say:

I have worked on more than a few transactions involving significant sums of money, and the details of those transactions have always been damned near mind boggling. And yet, here we are, asking a bunch of goddamned legislators (most of whom, in both parties, are absolutely clueless and some of whom are part of the problem) to pass on possibly the biggest transaction in American history – one that has been put together in a matter of days!

Look, you can’t do a proper job of buying or selling even a goddamned luncheonette in this amount of time. Even with the buying or selling of a luncheonette, the devil is always, always in the details. Doing a transaction that is worth possibly a trillion dollars in such a short time is begging for trouble.

Indeed. Part of me thinks that the boys in Washington all know that a catastrophic collapse is coming, and nothing they do is going to stop it. They're all posturing around with solutions that they know won't work, just so that later they can say, "I tried."

God help America.

Comments (29)

“I’m going to be pressing our colleagues around the world to design similar programs for their banks and institutions. Our system is a global one,” Paulson stated.

New World Order anyone?

Let's all step back from this absurd circus for a moment and have a good, hard laugh. We are so totally screwed -- let's stop taking this so seriously.

And the Chimp's legacy as the Worst President Ever is now 100 percent secure.

Well Bill M. read this!
Threatened by a "financial tsunami," the world must consider building a financial order no longer dependent on the United States, a leading Chinese state newspaper said on Wednesday.


I read that article this morning. You know I did finally have a good hard laugh about all this. The key is to see it from a hundred years or so away.
I mean you have the screw-up son who's just about to leave office. Now if it's going to be the darkest farce of all time, he has to go out with a big finish, right?
How about a half-ass trillion dollar bailout? If you can get the right take on that, it is classically hilarious. On the way out the door he drops the economy of the world into the abyss. Once I started chuckling I looked at that dumb expression of his at the press conference and I swear I was laughing like a lunatic.

Imagine Oliver Stone. He thought he was right on time with his W film opening next month but in the short interval since he finished filming, W has gone on to even greater screw-ups. I bet there's a little text update at the end of that beast.

Think of those Mastercard commercials: Iraq war One trillion dollars, Budget Shortfalls, 2 or 3 Trillion. Shit-canning the world's economy? Priceless.

And on the way out he's literally sticking up the American People. It's going to be hard for us to vote with both hands in the air.

Jack, I think you sell him short (bad choice of words) when you say he's merely the Worst President Ever. We might be witnessing reverse greatness here. Depending on how this all plays out, this could be the biggest screw-up in human history.

I'm confident W can still pull it off. Hilarious.

I think I need to order "A Short History of Financial Euphoria." A short summary is here. The other reviews are good too.

Let's say everyone's worst fears come true. Can you imagine what under 30 year-olds in this country would do if presented with a full-blown Dust Bowl, bread lines, Cinderella Man, sell the furniture or burn it to keep warm, John Steinbeck, gotta flee to California for a job that pays a quarter a day, Depression?

Not that the Boomers would be able to handle it either but we're talking about a generation of over-indulged consumers that can't live without text messaging and their PS3s, let alone the possibility that not even a New Deal 2.0 could save us from a nationwide tailspin.

Stop it, Jack. You're scaring all us
"young creative" types.

If I saw one single bright spot to talk about, believe me, I would. This is scarier than the farookin' Cuban missile crisis.

no joy here...
And a "new world order" doesn't thrill me either.
I dare say some of us will luff along for a while. I am really glad I do not have kids. If I did I would be worried sick.

There's a lot going on here besides the bailout. Newt Gingrich is using this to call for vouchers, increased offshore drilling, and repeal of Sarbanes-Oxley:


I'd expect to see a lot of unrelated legislation pushed through in the name of "making sure this doesn't happen again."

About Sarbanes-Oxley The legislation establishes new or enhanced standards for all U.S. public company boards, management, and public accounting firms. It does not apply to privately held companies. The Act contains 11 titles, or sections, ranging from additional Corporate Board responsibilities to criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement rulings on requirements to comply with the new law.
If Newt is agin, it it must be sound. Wasn't his motto In god we trust..if it brings us dollars.

Banks create money by lending more than they have. When they fail, the supply of money contracts with a multiplier effect. So multiple, large bank failures could dramatically reduce the supply of money, and businesses that can't borrow can't meet payrolls, pay suppliers, taxes, etc. Other lenders might come into the market, but not being banks, they would not have the power to create money by lending what they don't have. I'm not saying the proposed bailout is the way to address this risk (I think it definitely is not), but I do think liquidity is essential to maintaining the economy.

Where have all the righty/dead-ender comments been the last few days? We need some cheering up!!

Where have all the righty/dead-ender comments been the last few days?

I've been wondering the same thing. Comment counts are down as much as the market and the dollar. I think something's finally happened to shut them up.

I'm 40, and this is the fifth time that the U.S. Economy fell into recession and was broadly denounced as unsustainable by the Left. Each time, the decline of America was predicted, with the intelligentsia predicting the rise of Socialism, or Germany, Japan, and now China.

The first was in 1973-75. The second was in 1980-82. The third was during the panic of October 1987. The fourth was in 2001. The fifth started in November of 2007, as the mortgage crisis began to reveal itself (while home prices began declining in 2005 or 2006 depending on location).

As Ken Fischer wrote in Fortune in February 2008:

We will get through this, and American Capitalism will be stronger (albeit less leveraged). As The worrywarts seek a parallel to today's market and think they see it in 1930: credit crunch, rising unemployment, financial institutions in trouble. So we must be in for a ferocious bear market. I seek a parallel and find it only ten years ago. And that makes me bullish.

Early 1998 saw financial crises eerily similar to today's and a lot of hand-wringing about institutions collapsing and setting off a domino chain of other collapses. But guess what? The S&P 500 was up 28% that year.

Still here Jimbo and Allen, and just as worried as you. Not ready to point the finger at Bush alone and then give the crooks in congress and wall street a pass. But anyway, I feel the pain too. Sorry Jimbo, I may not have cheered you up this a.m.

KISS:you've got it exactly backwards. Sarbanes-Oxley applies to the private sector.

Public= government
Private= non-government

I think we'll get through this crisis in a year or two, but we'll come out of it a greatly diminished nation. We'll still be the planet's dominant nuclear power, but we won't be the dominant military or economic power. Universal health care? Probably not going to happen until we get through this mess. And even then, it's very questionable that we'll be able to afford it.

Although many of our so-called "leaders" have had a hand in creating this crisis, I agree with Bill M.: Bush is getting pretty close to becoming the worse screw-up in history, and he has almost four more months to go. I don't know what the rest of you were thinking, but I never voted for him.

Richard/s: in Sarbanes-Oxley parlance, "public" refers to companies that are publicly held and traded, and "private" means closely-held companies. Of course, both classes are part of the private sector, but Sox applies only to public companies.

Our power is to make the mechanism work. The wheels of Justice grind slowly, but they grind very fine.

The war crimes and crimes against humanity at the 'highest' levels must be brought trickling 'down' to apply to ordinary folks. Folks around us. Folks we talk with and work with. Folks in our family and along our streets in our neighborhood.

D.A.'s who don't indict, cops who don't arrest, judges who don't hear argument and rule -- are the evil, the fascism, the infamy.

Shame on slackers and the selfish. Call them out, to their face. We know who they are, we know their names, we write their life story in spit. And cast them out of our way, and get to work.

Withdraw from the political-partied nationalism. We reject any more 'federal' dollars, and the dollar bill itself. Take care of living life locally, working in watershed landforms as our political borders. With limited human-scale power.

Bind up the wounds of the war-weary. Provide for the widows and orphans. Demolish the LIAR media, editors who LIE, hell-fantasy publishers -- all die in agony. Who lives goes to school on our internet, goes to work on our farms, lives in Justice.

Absolute power has corrupted the 'highest' nationalism level absolutely. Discard them.

Scribble 'FLICK BUSH' graffiti on every dollar bill you pass along.

"... we'll get through this crisis in a year or two ..."

Yeah, that's what the British told themselves after the Colonies up and split.

No. Try to understand, folks, none of it is ever coming back. All we knew, is over.

The main of it is all of the oil on the planet is running dry. 'These guys' lives were from Big Oil, right?

Think of oil as work in the ground, labor that nobody did. That's what the last century was, and built: Work that nobody did. Oil did the work. Everybody lived in luxury, spoiled rotten.

It is NOT 'coming back,' 'after we get through this.' Kiss the past good-bye.

"Think of oil as work in the ground, labor that nobody did."

Kind of like uranium? Or how about wind? Or running water? Or the sun?

Of course we rely on external sources of energy (the "work" to which you refer). For most applications, there are alternatives to oil. It's just that, until recently, there was no incentive to pursue the alternatives. Oil was too cheap.

In the presence of alternatives, Hubbert Linearization curves don't spell the end of the world. Peak oil may mean that life becomes marginally more expensive. It may be an uncomfortable margin, but it's not the end of the world . . .

That is, barring a world-wide economic collapse resultant from a lack of liquidity. I have some real questions about fiat currency and fractional reserve banking, but I may be just another quack. I sure wish the pundits were talking about this issue.

"Bush is getting pretty close to becoming the worse screw-up in history" Can we throw in Congress as close acoomplices? The same people who loved speding time on witch hunts instead of addressing problems?

The most cogent question in banking committee hearings this morning: Is there some reason we can't commit 150 bil. rather than 700 bil. Expend that amount and see what impact it produces, then come back to Congress and request more if needed?
Paulson's answer was that we need the entire amount now to provide appropriate assurance to the market and maximize flexibility. No guarantees the plan will work though. In light of the lack of certainty I much prefer the idea of a more modest initial commitment.

$150 billion with no accountability (other than what goes with having to beg for more) doesn't protect ordinary people adequately. We'd just be blackmailed again. That's not to say that the smaller pot of boodle isn't a good idea -- there just need to be some safeguards along with it.

I haven't been able to find a satisfactory answer so far: What will happen if we DON'T go through with the bailout? All I've seen is statements that it has to happen so that the economy won't collapse. Well, what happens if the economy does collapse? What does that look like? Is it like what Brandon suggested: "a full-blown Dust Bowl, bread lines, Cinderella Man, sell the furniture or burn it to keep warm, John Steinbeck, gotta flee to California for a job that pays a quarter a day, Depression?" Isn't it quite possible that this will happen anyway, with or without a bailout?

Not surprisingly, Stephen Colbert said it best....

"This is from the given and the buying of bad loans. We're about to give an 85-billion dollar loan to somebody who couldn't run a business. Isn't that a risky loan for the United States?"

I ask all of you....If you were personally in this situation and you went to a banker, do you think they'd lend you money?


So why are we running in to this without getting the conditions we want and a shipload of collateral?

Thank goodness the nearly TRILLION dollar bailout has gotten negative feedback and appears to be skidding to a halt. I'm sick of these cats making their money on the backs of us.

In response to the 'end of the world as we know it' people:

First, stop being a shrill. Either do something about it or shut the **** up so the rest of us can have a little peace. As a early 20's guy from humble a backround, count one vote from me for a simpler world. It might save us all. I'm personally so utterly tired of living in a world of self absorbed, sick, money hungry, community lacking, fresh air killing, drug abuse friendly people and world at large. It is killing our average person in uncounted, indirect ways and that disease will reach all of us, at some point.

Dubya has taken an enormous dump on our country and in a couple of years short attention span America will forget that it was his fault and start blaming the majority in Congress for all the crap. Wait and see.

The fearmongering is like the anthrax mail-in murders, drumbeaten to stampede Congress hysterical enough ... to pass the Put All The Rightwingwackos In Oil-soaked Tires (PATRIOT) Act. Else 'turrists' would destroy us 'over here.'

Now see the fear injection is all baldfaced LIES. It is NOT any 'furriners' at all; it is our own MilitaryIndustryANTHRAX aiming to Big LIE down the slippery slope to military rule right here where we're standing traumatized, and destroy us here.

We've seen the rightwingwacko Congress-coersion extortion trick before.
ix-nay is-thay ime-tay.

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