Economics

Wall Street Roundup

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Yves Smith:

[H]ere is the truly offensive section of an overreaching piece of legislation: "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

This puts the Treasury's actions beyond the rule of law. This is a financial coup d'etat, with the only limitation the $700 billion balance sheet figure. The measure already gives the Treasury the authority not simply to buy dud mortgage paper but other assets as it deems fit. There is no accountability beyond a report (contents undefined) to Congress three months into the program and semiannually thereafter. The Treasury could via incompetence or venality grossly overpay for assets and advisory services, and fail to exclude consultants with conflicts of interest, and there would be no recourse. Given the truly appalling track record of this Administration in its outsourcing, this is not an idle worry.

But far worse is the precedent it sets. This Administration has worked hard to escape any constraints on its actions, not to pursue noble causes, but to curtail civil liberties: Guantanamo, rendition, torture, warrantless wiretaps. It has used the threat of unseen terrorists and a seemingly perpetual war on radical Muslim[s] to justify gutting the Constitution. The Supreme Court, which has been supine on many fronts, has finally started to push back, but would it challenge a bill that sweeps aside judicial review?

Sebastian Mallaby:

[In the S&L crisis], the government did not need a strategy to decide which bad loans to take over; it dealt with anything that fell into its lap as a result of a thrift bankruptcy. But under the current proposal, the government would go out and shop for bad loans. These come in all shapes and sizes, so the government would have to judge what type of loans it wants. They are illiquid, so it's hard to know how to value them. Bad loans are weighing down the financial system precisely because private-sector experts can't determine their worth. The government would have no better handle on the problem.

In practice this means the government would make subjective choices about which bad loans to buy, and it would pay more than fair value. Billions in taxpayer money would be transferred to the shareholders and creditors of banks, and the banks from which the government bought most loans would be subsidized more than their rivals. If the government bought the most from the sickest institutions, it would be slowing the healthy process in which strong players buy up the weak, delaying an eventual recovery. The haggling over which banks got to unload the most would drag on for months. So the hope that this "systematic" plan can be a near-term substitute for ad hoc AIG-style bailouts is illusory.

Christopher Caldwell:

Republicans may suffer damage not because their remedies are worse but because a lot of their ideology about how markets work has been belied by events. Republicans are the party of rewarding people for risk-taking. If the government covers part of the losses, then the risks were illusory in the first place. (So, of course, were some of the rewards. A good percentage of the proceeds from the controversial Bush tax cuts was surely poured into this black hole of speculation and unknowability.)

President George W.?Bush, Fed chairman Ben Bernanke and treasury secretary Hank Paulson all declare their preference for free-market solutions and a desire to minimise moral hazard. But they sound like François Mitterrand in mid-1983 when he abandoned his socialist programme commun in the face of capital flight and a collapsing franc, all the while proclaiming his devotion to socialism.

Ken Layne:

Turns out we didn't need "stealth socialist" Barack Obama to pervert capitalist America into a crumbling nationalized economy run in private by a dome-skulled kleptocracy as our nation's battered military wastes away in the forgotten bummer of a civil war in Afghanistan.

Jim Henley:

Who imagined that the great opportunity for joint progressive and libertarian advocacy and activism would end up being economic? But that's where we are. This loathsome bailout plan is a slap in the face to anyone who believes in either free-market principles or social justice.

Matthew Yglesias:

[B]ad policies get enacted all the time. But we're at a point now where congress is, allegedly, in the hands of progressive leadership. Simply put, if congressional Democrats manage to acquiesce in a plan that spends $700 billion on a bailout while doing nothing for average working people and giving the taxpayer virtually no upside in a way that guarantees that even electoral victory would give an Obama administration no resources with which to implement a progressive domestic agenda in 2009 then everyone's going to have to give serious consideration to becoming a pretty hard-core libertarian.

James Joyner:

Bernanke says, "There are no atheists in foxholes and no ideologues in financial crises." But if there's ever a time to hold strong to fundamental principles, it would seem that this would be it. We're setting precedents that will govern the behavior of the international business community for decades to come. Do we really want to signal that risks are public and rewards are private?

For that matter, do we really want such fundamental decisions being made by obscure, unaccountable men like Bernanke, Paulson, and SEC chair Chris Cox? Shouldn't Congress and the president be more than bit players?

At a practical level, Amity Shlaes is right when [s]he notes that, "The stock market crash of October 1929 and the Great Depression were not the same thing." And a New Deal II could just as easily lead to Great Depression II as letting creative destruction do its thing.

NEXT: Henry Paulson, Regent Dictator

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  1. We’re setting precedents that will govern the behavior of the international business community for decades to come. Do we really want to signal that risks are public and rewards are private?

    That signal has already been sent. See Freddie, Fannie and A.I.G. We need to say, “Oops, my mistake complete fuckup. No more of this stupid shit.”

  2. Do we really want to signal that risks are public and rewards are private?

    Gotta hand it to him, this is the statement that sums up everything in this whole, godawful mess.

  3. Ron Paul, thou shouldst be living at this hour . . .

    oh, wait, he *is*!

    Damn, that’s embarrassing – nobody is more unpopular than some jerk who’s right and won’t shut up about it. Look what they did to Jeremiah.

  4. Damn, that’s embarrassing – nobody is more unpopular than some jerk who’s right and won’t shut up about it. Look what they did to Jeremiah.

    Damned Cassandras.

  5. I like the Henley post. We need to get libertarians and liberals together to kill this monstrosity. I’m posting about this on Kos and Huffington, and getting basic agreement. Maybe we can raise enough of a stink to slow it down at least.

  6. It’s not a one time $700bil. infusion. It’s pool of $700 billion. So the can buy $700b worth of whatever, wait a few months, say what they bought is now only worth $300b and buy $400b more.
    From almost anyone too, they’re including non-US based investment firms in this. Can’t piss-off the Chinese, can we?
    Also, commercial RE.
    I suppose none of that matters since Herr Paulson will be beyond the law.

  7. Another negative take on this disastrous plan.

    Some excerpts:

    If banks and financial institutions find it difficult to recapitalize (i.e., issue new equity) it is because the private sector is uncertain about the value of the assets they have in their portfolio and does not want to overpay. Would the government be better in valuing those assets? No. In a negotiation between a government official and banker with a bonus at risk, who will have more clout in determining the price? The Paulson RTC will buy toxic
    assets at inflated prices thereby creating a charitable institution that provides welfare to
    the rich-at the taxpayers’ expense.

    [. . .]

    As during the Great Depression and in many debt restructurings, it makes sense in the current contingency to mandate a partial debt forgiveness or a debt-for-equity swap in the
    financial sector. It has the benefit of being a well-tested strategy in the private sector and
    it leaves the taxpayers out of the picture. But if it is so simple, why no expert has mentioned it?

    The major players in the financial sector do not like it. It is much more appealing for the
    financial industry to be bailed out at taxpayers’ expense than to bear their share of pain.
    Forcing a debt-for-equity swap or a debt forgiveness would be no greater a violation of
    private property rights than a massive bailout, but it faces much stronger political opposition. The appeal of the Paulson solution is that it taxes the many and benefits the
    few. Since the many (we, the taxpayers) are dispersed, we cannot put up a good fight in
    Capitol Hill; while the financial industry is well represented at all the levels. It is enough to say that for 6 of the last 13 years, the Secretary of Treasury was a Goldman Sachs
    alumnus.

    [. . .]

    For somebody like me who believes strongly in the free market system, the most serious risk of the current situation is that the interest of few financiers will undermine the fundamental workings of the capitalist system. The time has come to save capitalism from the capitalists.

  8. C’mon, you guys, lighten up. Someday we’ll all be dead, if only from starvation.

  9. The time has come to save capitalism from the capitalists.

    The best defense against capitalism is the free market.

  10. At least we can still watch porn on the internet. So we’re free, right?

  11. You know, I managed to avoid thinking about this by partying from Friday night through this afternoon, but there’s only so long you can use alcohol and drugs to battle reality. This is such a clusterfuck it’s unbelievable.

    C’mon, you guys, lighten up. Someday we’ll all be dead, if only from starvation.

    “You can eat this now, or be hungry in a couple of days when we run out of money for food.”

  12. Very interesting to note that on the Corner Newt Gingrich and Yuval Levin have both expressed strong skepticism about the plan. If they’re not supporting the administration here, who is? If not for the profound idiocy of the Democratic Congress I think we could rest fairly easy.

  13. So much for “too big to fail,” now the standard is what, “too big a campaign contributor to fail?” Come on, who do we have to blow to get a hand-job this big? Accountability has long been dead in government and now it has officially been called on Wall Street.

  14. I would prefer the market be left to sort this mess out.If the State has to “do something” the voluntary equity for cash swap seems the lesser evil than buying the debt instruments.

  15. At least with a stadium we had the chance to buy tickets. Can I have mustard on my shit hot dog?

  16. I would prefer the market be left to sort this mess out.If the State has to “do something” the voluntary equity for cash swap seems the lesser evil than buying the debt instruments.

    Sounds good to me. Hey, we agree on something!

  17. I can see Obama and McCain scheduling a joint press conference to say, “See ya in four years. When this all gets sorted out we’ll be standing by to pick up the pieces.”

  18. When does Paulson suspend elections until the “economic crisis is resolved”? A week before the polls open, a day?

  19. I notice that all of the sources Jesse found were liberals, progressives, or libertarians.

    So, what’s up with the Republicans and conservatives?

  20. Joe,

    I suspect most Republican pundits wouldn’t bat an eye if George Bush danced into a press conference wearing a hammer and sickle arm-band and announcing the dictatorship of the proletariat.

    Their focus is power, the getting of it, the using of it. Ideology is for the guys who come in second in elections – you know, the first losers.

  21. I’m searching for opinion. The consensus here is like that line from Airplane “They bought their tickets – I say, ‘let ’em crash'”

    What is it that Paulson and Bernanke told Congress that made them universally crap their drawers? Why is Greenspan (no small player in this clusterfuck) stating end of the world? There are two ways to look at this:

    $700B worth of socialism is a calamity OR $700B on top of a $9T nat’l debt in a $13T annual economy is not the end of the world. Seems to me calmer heads would invoke the latter, but clearly these guys are scared. Are we a day away from a run on the banks if this doesn’t go through or what.

  22. Good for Newt Gingrich.

  23. there’s only so long you can use alcohol and drugs to battle reality

    This is what you get when you party all weekend. You get fork-stabbed. Fork-stabbed!

  24. Look what they did to Jeremiah.

    Damned shame. He always had some mighty fine wine.

  25. This is fucking BS. This should be something dems, libts, and republicans could all get together against, but who knows? Politicians have been acting even stupider than usual lately.

  26. Joe: Caldwell is a conservative. I think Joyner considers himself a conservative too.

  27. $700B on top of a $9T nat’l debt in a $13T annual economy is not the end of the world.

    How much money do you make in a year? Probably many thousands of dollars, right?

    So you wouldn’t mind giving me a grand for no reason? I mean compared to $40K or whatever, it’s not much.

  28. Pelosi: “Congress will respond to the financial markets crisis by taking action this week in a bipartisan manner that will protect the taxpayers’ interests. The Administration’s $700 billion proposal does not include the necessary safeguards. Democrats believe a responsible solution should include independent oversight, protections for homeowners and constraints on excessive executive compensation.

    “We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome. Democrats will act responsibly to insulate Main Street from Wall Street.

  29. Bernanke says, “There are no atheists in foxholes and no ideologues in financial crises.”

    Oh, and Helicopter Ben, there have been atheists in foxholes ever since there were foxholes, you insufferable fuckup. It’s illustrative though that you pair your theocratic bullshit with your economic bullshit, though.

  30. Ha! I like this one better, from an unnamed Democrat:

    Paulsen and congressional Republicans, or the few that will actually vote for this (most will be unwilling to take responsibility for the consequences of their policies), have said that there can’t be any “add ons,” or addition provisions. Fuck that. I don’t really want to trigger a world wide depression (that’s not hyperbole, that’s a distinct possibility), but I’m not voting for a blank check for $700 billion for those mother fuckers.
    Nancy said she wanted to include the second “stimulus” package that the Bush Administration and congressional Republicans have blocked. I don’t want to trade a $700 billion dollar giveaway to the most unsympathetic human beings on the planet for a few fucking bridges. I want reforms of the industry, and I want it to be as punitive as possible.

    Henry Waxman has suggested corporate government reforms, including CEO compensation, as the price for this. Some members have publicly suggested allowing modification of mortgages in bankruptcy, and the House Judiciary Committee staff is also very interested in that. That’s a real possibility.

    We may strip out all the gives to industry in the predatory mortgage lending bill that the House passed last November, which hasn’t budged in the Senate, and include that in the bill. There are other ideas on the table but they are going to be tough to work out before next week.

    I also find myself drawn to provisions that would serve no useful purpose except to insult the industry, like requiring the CEOs, CFOs and the chair of the board of any entity that sells mortgage related securities to the Treasury Department to certify that they have completed an approved course in credit counseling. That is now required of consumers filing bankruptcy to make sure they feel properly humiliated for being head over heels in debt, although most lost control of their finances because of a serious illness in the family. That would just be petty and childish, and completely in character for me.

    I’m open to other ideas, and I am looking for volunteers who want to hold the sons of bitches so I can beat the crap out of them.

  31. Isn’t there something unpersuasive about a government that turns its citizens into fiat-money junkies running a WOD?

  32. And with that, Pelosi signals what her plan. Take this request and use it as enormous leverage for significant regulation and even more handouts.

    I assure you that congress will make this awful proposal much, much worse before it gets passed.

  33. And with that, Pelosi signals what her plan. Take this request and use it as enormous leverage for significant regulation and even more handouts.

    I assure you that congress will make this awful proposal much, much worse before it gets passed.

    Of course, but they’ll pat themselves on the back for it.

    Fuck this.

  34. This is what you get when you party all weekend. You get fork-stabbed. Fork-stabbed!

    Please tell me you saw the first two episodes for this season. The human meat thing and the fucking gas. Oh my god. My cousin and I were freaking out about it on the way to the party yesterday.

    “Which one of us do you want to take you in the back and bang you?”

  35. The Treasury could via incompetence or venality grossly overpay for assets and advisory services, and fail to exclude consultants with conflicts of interest,

    […]

    Now come on. Could anyone seriously see this happen?

  36. So you wouldn’t mind giving me a grand for no reason? I mean compared to $40K or whatever, it’s not much.

    Don’t mistake my question for acquiescence – I’m pissed.

    This seems to work out to around $2.5 k per capita, maybe $10k average per taxpayer/family. In the short term, probably favorable to the 401k losses taken if the Dow were to drop a few thousand points but there’s clearly more to it – the fear is palable. I just don’t grasp what has them running so scared.

  37. So, somebody help me out here. Exactly what is to prevent these folks from spending the 700 billion on hookers and blow? And if they did spend it on hookers and blow, what, if anything, could we do about it?

  38. Johnny Clarke:

    Joe points out:

    Democrats believe a responsible solution should include independent oversight, protections for homeowners and constraints on excessive executive compensation.

    “We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome. Democrats will act responsibly to insulate Main Street from Wall Street.

    Feel better?

    One word: FISA

    Oh fuck it, two more words: Iraq War

  39. We could demand equal helpings of hookers and blow for the middle class. That seems to be the logical extension of the current Democratic position. As the old saw goes, the GOP will demand a $700B bailout, the Dems a $500B bailout, and they’ll ultimately compromise on a $2T bailout.

  40. Key words:

    independent oversight

  41. independent oversight = we want a cut of the free money too

    There were a lot of nice-sounding words associated with the Dem cave-ins on FISA and Iraq, too.

  42. joe | September 21, 2008, 7:14pm | #
    I notice that all of the sources Jesse found were liberals, progressives, or libertarians.

    So, what’s up with the Republicans and conservatives?

    I went to Redstate.com to see if any conservatives supported this anathema, and found nothing in support, and this commentary in opposition:

    Not as eloquent as Newt Gingrich, but it looks like some Republican in Congress aren’t gonna roll over and play dead for Bush on this bad puppy

  43. “So, what’s up with the Republicans and conservatives?”

    Rejoicing that their stocks are protected? Republicans are once again proving themselves to be more pro-aristocrat than pro-free market.

    Sadly the best thing that can happen from this whole thing is that the companies still fail after the loan and then taxpayers will be out a great deal of money. Lessons harshly learned would hopefully lead to the realization that government can’t fix the economy and to the expulsion of all the politicians advocating for this thing. Expensive, yes. But potentially worthwhile as an example. If the companies succeed, the lesson won’t be learned and it will happen again.

    Someday people will look back at this time when Republicans advocated for regulating the free market and Democrats decided it’s a good idea to bail out the rich and realize just how messed up both the major parties are. Libertarians can get a better feel for which politicians are truly pro-free market based on their response to this issue.

  44. Guess I shouldn’t have been so overbroad.
    *Many* Republicans are once again proving themselves to be more pro-aristocrat than pro-free market.

  45. “Turns out we didn’t need “stealth socialist” Barack Obama to pervert capitalist America into a crumbling nationalized economy run in private by a dome-skulled kleptocracy as our nation’s battered military wastes away in the forgotten bummer of a civil war in Afghanistan.”

    That was just flat out hilarious.

  46. Paulson has to put himself beyond the courts, for a pretty simple reason.

    The process of selecting, pricing, and prioritizing assets to buy will create many opportunities for either apparent or actual favoritism. Remember, Bear and Lehman were allowed to die, but heaven and Earth were moved to save Goldman.

    $700 billion worth of winners will be picked, and everyone else will be a loser. Paulson doesn’t want the losers to sue.

  47. Oh, by the way, I think it’s interesting that Phil Gramm managed to get it fixed so that foreign banks, like his employer UBS, could also get bailed out by the new $700 billion fund.

    Why in hell would we want to bail out foreign banks? Aren’t there foreign governments available to bail out foreign banks?

    You know, with Phil Gramm on the payroll of UBS and a big part of McCain’s foreign policy team on the payroll of Georgia, basically McCain’s entire agenda is up for sale to foreign nations.

    Since that’s the case, we should start collecting funds to outbid the current bidders. After all, Phil Gramm’s salary at UBS can’t be that high, and McCain’s foreign policy was sold to Georgia for a handful of millions of dollars paid to his advisors. Could we get some Koch money and some Soros money together, maybe have a Ron Paul moneybomb, and buy up the set of traitors and punks McCain has surrounded himself with?

  48. Why am I hearing so much about libertarians “getting in with the democrats”?

    I realize that Reason has a lot of cool liberals to impress, and I’m scared too; but seriously, we libertarians disagree with the liberals primarily on grounds of ECONOMICS. You think those clowns are gonna “unite” with libertarians to help win back capitalism? This is like trying to get a five year old to align with the monster in his closet.

    The only thing I’ve heard a liberal say about this mess is that capitalism is dead. And some bromides about greed. And that regulations didn’t come soon or strong enough. And Obama blagh blagh McCain. In short, the same thing the Republicans have been saying.

    I don’t care how hip it is, libertarians should not appeal to the economic understanding of socialists. Ever.

  49. Epi,

    Partying? On the eve of the apocalypse? You should be hoarding food, water, guns, and other essential goods! Personally, I’m working on my swordmanship.

    “You’re listening to Klost home of the Apocalypse. The call in question of the day is who will be the new king? I’m sending in an ICBM across the wasteland for all of you on the yellow brick road to Vegas looking for a hero. If you find one send him my way, baby.”

  50. A priori, why do you think we’re so pissed. We know that the Dems are just salivating over this while republicans sit with grave faces, trying to figure out what went wrong.

    You noticed this $700 billion was a “bipartisan” response? Everyone here is pretty much on the same page when politicians get all bipartisan on us.

    It usually means it’s time to start fondling the firearms.

  51. The Night of the Long Knives is at hand. And y’all are going to be on the wrong side of the barricades.

    Well, maybe not Joe. 😉

  52. Is that all there is?

    Well, let’s break out the booze and have a ball.

  53. I was born on the wrong side of the barricades.

  54. This seems to work out to around $2.5 k per capita, maybe $10k average per taxpayer/family.

    That’s OK, they can make up for it by sending out more economic stimulus checks!

  55. Paulson should just use the “Easy Button”.

  56. “Oh, by the way, I think it’s interesting that Phil Gramm managed to get it fixed so that foreign banks, like his employer UBS, could also get bailed out by the new $700 billion fund.”

    The US has went from “Daddy Warbucks” to everyone’s economic biatch crack whore during the Bush Administration, great legacy, heckuva job there Bushie.

  57. “Regulators have abandoned their duty by letting markets regulate themselves. It’s because a market fundamentalist ideology has come to dominate the behaviour of market participants and market regulatorsover the past 25 years … and the idea that markets are best left to their own devices became policy.”–George Soros

  58. Let us pray.

    Hail Market,
    Full of grace,
    Prosperity is with thee.
    Blessed art thou among systems,
    and blessed is the fruit
    of thy womb, Capital.
    Holy Market,
    Mother of Goods,
    pray for us consumers now,
    and at the hour of our bankruptcy

  59. Loan Titans Paid McCain Adviser Nearly $2 Million
    E-Mail

    By DAVID D. KIRKPATRICK and CHARLES DUHIGG
    Published: September 21, 2008
    Senator John McCain’s campaign manager was paid more than $30,000 a month for five years as president of an advocacy group set up by the mortgage giants Fannie Mae and Freddie Mac to defend them against stricter regulations, current and former officials say.

  60. there’s only so long you can use alcohol and drugs to battle reality

    Could you tell me what that is, exactly? I’m going shopping and there’s no point buying more than the effective dose. Money’s tight and all.

    $700B on top of a $9T nat’l debt in a $13T annual economy is not the end of the world.

    That’s $2333 each for me and the missus. Kinda feel bad my (3) kids getting saddled with the $7000. I guess since they were going to get crushed by Social Security and Medicare, what’s a couple more pallets of bricks?

    Democrats believe a responsible solution should include independent oversight, protections for homeowners and constraints on excessive executive compensation.

    Let us set aside for the moment the FACT that we l/Libertarians are right on economics. Let us stipulate — for argument’s sake — that some theoretical government could make decisions here better than the market. How could anyone POSSIBLY believe that THIS particular government could?!?

    And, as to Democratic oversight, since their mandate to Stop the War in 2006, they have so far alternated between “saying [his] name, bitch!” and “squeal[in’] lahk a pig!”. How can Pelosi speak on this with authority? How can she speak to it with a straight face?!

    This is where I think we actually have a chance for outreach to the Dems and the Reps. When the powers on both sides are saying “this is so terrible that we can’t even TELL you how bad it could get,” we can remind the soon-to-be-former believers in state power, “this is what they said about Saddam’s WMDs, Guantanamo, warrentless wiretaps — they only say this to scare you into submission; STOP SUBMITTING!!”

    Bernanke says, “There are no atheists in foxholes and no ideologues in financial crises.”

    This is an excellent analogy to point out that, no matter HOW bad things appear,
    and no matter HOW bad things become, turning to SATAN is never the logical choice!!

    Signing over our paychecks and our economic freedoms to a cadre of secretive, power-hungry incompetents is a Faustian bargain, pure and simple. Except, Faust got a few good years out of it, and there are going to be scarce few outside of Wall Street and the Beltway who will get any pleasure out of this AT ALL.

    To the barricades!!…

  61. US Constitution, Article III, Section 2: “In all the other Cases before mentioned, the supreme Court shall have appellate Jurisdiction, both as to Law and Fact, with such Exceptions, and under such Regulations as the Congress shall make.”

    By my reading of the Constitution, this rarely used power makes it proper for Congress to remove this bill from the Supreme Court’s jurisdiction. However, removing the district courts, which have original jurisdiction, does not seem proper.

  62. “Regulators have abandoned their duty by letting markets regulate themselves. It’s because a market fundamentalist ideology has come to dominate the behaviour of market participants and market regulatorsover the past 25 years … and the idea that markets are best left to their own devices became policy.”–George Soros

    Guess those Southeast Asian regulators shoulda stopped George Soros before he drove most of Asia into financial bankruptcy in the late 90s and caused serious poverty for millions of people of those countries simply for his own greed. Yeah, he’s really got a heart of gold…not.

  63. I keep telling conspiracy theorists that they are wasting their time- the truth is always on page one! You don’t need a conspiracy to nationalize a country. Paulson has just announced himself, in every newspaper, as new Czar of USSA and no one blinks. In bold print on page one, and everyone misses the point.

    We Libertarians were vindicated sooner than we thought. And its not comforting at all. I am officially terrified of mandatory gov. health care.

  64. This debacle has me constantly thinking about the James Brown “Living In America” performance in Rocky IV.

    Shit seems appropriate somehow.

  65. We Libertarians were vindicated sooner than we thought. And its not comforting at all. I am officially terrified of mandatory gov. health care.

    Holy non sequitor, Batman!

    Seriously, how do you segue from this fucking travesty of a bailout to health-care policy? I understand that in some ideologically fueled zones not connected with reality, they are somehow similar, but…when you have to talk to us plebes, fucking take one thing at a time. WTF.

  66. The financial state of the U.S. has everything to do with health-care policy…and pretty much everything else vital to living that the government wants to control but shouldn’t.

    Meant no offense to the “plebes” and yeah, the transition to health care policy was a bit scatter shot. But I’m not writing a book or paper you will be grading. And the idea “What in the hell is this gonna do to people that are sick and need health care.” popped into mind.

    I suppose I could’ve added similar concerns to food, gas and any number of other material goods and services linked to the financial structure of the country.

    I’m afraid that this is going to be not so “loosely connected” to reality, ideologically-fueled or not. I am afraid that with a nationalization of finance, there will be all sorts of things people used to be able to afford but will soon not be.

  67. Those dayum libruhls aren’t the natural enemies of libertarians, necessarily. They’re just afraid of the Hobbesian nightmare that they think a free market would create. They’re not evil; they want everyone to be clothed and fed, and they don’t trust anyone but the state to do it.

    If they’re paying any attention, the last eight years have left them with a distaste for overweening federalism. Their boy Obama’s platform looks like it could be a disaster, if implemented as written, but what are the odds of that now? Either president will be treading water for at least four years.

    Libertarians are a more rational and optimistic lot. We know there are more efficient ways to get the things that liberals want. This would be a really bad time to turn into gun-fondling reactionaries. Let’s keep the floor open for dialogue, and separate ourselves from the Social Darwinist racketeers that caused this mess.

  68. This isn’t the corruption of politics by money, instead, it’s the corruption of money by politics.

  69. Bloomberg is reporting this am they are going to take all bad debt. Credit card, car loan etc.
    No switching you cash from FDIC insured accounts to the newly insured money market accounts either.This is a fucking coup.

  70. Well, this is just what we get by taking the government from a Harvard MBA and handing it to a ‘community organizer’.

    Wait, what? It’s not 2009 yet?

    WTF?

  71. This would be a really bad time to turn into gun-fondling reactionaries.

    Yeah, I’m a little sick of that meme, myself. Unless it’s Data saying it.

  72. There are no atheists in foxholes

    That’s insulting to both atheists and foxes.

  73. “Republicans may suffer damage not because their remedies are worse but because a lot of their ideology about how markets work has been belied by events.”

    So this is a all a result of “the market” , eh?

    Yeah – well execpt for:

    The federal reserve creating an asset bubble in real estate by pumping up the money supply, driving down interest rates and devaluing the dollar.

    The creation of, and changes to the “Community Reinvestment Act” whereby government encouraged lending to people with bad credit and the securitization of the resulting loans.

    The existence and mismanaged of quasi-government entities like Fannie Mae and Freddie Mac that served as a conduit for loan securitization and would never have been able to exist in the marketplace at all to begin with without implicit (now explicit) government backing.

    And last but not least, the Sarbanes Oxley “mark to market” rules that greatly contributed to the panic and forced drastic markdowns in long term assets – securities on loans that weren’t in default and/or foreclosure because they couldn’t be valued due to short term trading freezes.

    Other than all that, it was all due to “the market”.

  74. Unless it’s Data saying it

    No, unless it’s Lore saying it 😉

  75. Did anyone else catch the irony in Yglesias’ “Simply put . . . “(long, incoherent run-on sentence)?

    On writing competence alone, the guy doesn’t need to be included in the group.

  76. “We Libertarians were vindicated sooner than we thought. And its not comforting at all. I am officially terrified of mandatory gov. health care, retirement, morning exercises, housing, food, one piece jumpsuits, and soylent green factories.”

    There fixed that for truthiness.

  77. The efficacy of free markets and wastefulness of regulation does not need to be validated by every single economic downturn for laissez-faire to remain justifiable. It is a surrender to ideology that occupies unknowns with preconceptions.

    Economic crisis in particular is an ink blot.

  78. Any one else notice that the guy who will do the buying and the sellers are all Zionist Jews?

  79. Given the truly appalling track record of this Administration in its outsourcing, this is not an idle worry.

    Wouldn’t the bigger problem be what the NEXT adminstration does? The current one only hss 3 months to go.

    Of course, both parties are betting they’ll win on election day, so they both support this tribute to American stupidity.

  80. I don’t see any kind of Libertarian/Liberal alliance as a result of this. I see both self proclaimed liberals and conservatives supporting the bailout for “stability” reasons. We can’t let the big bad corporations wipe out old people’s 401k’s you see. The Liberals are just blaming deregulation legislation of the 90’s as the root cause and putting up with the bailout (with socialist strings attached) as a means to exercise more government control of the market.

    Like they said, the crash isn’t as bad as the inept government “help” that is coming as a reaction to it.

  81. I see both self proclaimed liberals and conservatives supporting the bailout for “stability” reasons. We can’t let the big bad corporations wipe out old people’s 401k’s you see.

    I’m not clear on what you’re saying here. Do you know actual liberals who reacted this way, or is it how you think they would react? The liberals I’ve talked to haven’t reacted the way I thought they would — they’re pissed about the bailouts, sounding a lot like libertarians.

  82. “I’m not clear on what you’re saying here. Do you know actual liberals who reacted this way, or is it how you think they would react? The liberals I’ve talked to haven’t reacted the way I thought they would — they’re pissed about the bailouts, sounding a lot like libertarians.”

    The liberals I know on the internets. Or at least the Obamanrol the economy.ations I know, are ardent supporters of the bailout. Using tax payer dollars to bail out corporate entities and keep short term stability is a testament to government stepping in to help control the economy from runaway free market collapse.

    They think it’s unfortunate the bailout is occuring but support it 100%.

  83. They think it’s unfortunate the bailout is occuring but support it 100%.

    Disappointing. One would hope that some government screw-up someday would be so massively stupid it would make liberals think twice about their fixation on government as the great problem solver. I guess no chance as long as there’s a Republican government — too easy to blame it on them.

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