But even I can figure out that when the Fed in effect takes over one of the world's biggest "insurance companies" because its ill-advised venture into mortgage securitization has caused it to gag on a massive cash flow crisis that this is not a good thing.
Oh, and you should raise your hand if you think that this "loan" is likely to ever be paid back.
Didn't think so, either...
I would add that I believe that the signals are more than a little strong that, no, the U.S. economy (now so dependant on the financial industry and consumer spending) is not especially "fundamentally sound".
I don't know whether this should be a hair-on-fire, Black Friday, hide-your-money-in-the-mattress kind of moment. But I know that our present financial regulations are pretty obviously not working well.
Particularly galling is the nasty little tax game that allows the malefactors of great wealth that put us in this handbasket to escape with more of their filthy lucre than they should.
Our politico-economic system has spent the last 28 years largely accepting the Reagan Revolution less-regulation-is-better/greed-is-good/the-market-will-solve-its-own-problems philosophy. This failed spectacularly in 1929 (the reason that the regulations were first enacted) and now looks to be failing spectacularly again. This was all very predictable, all very preventable, and now looks very likely to repeat itself. The only question that remains in my mind is whether the changes in the international and U.S. fiscal systems will be enough to prevent a Second Great Depression or whether we're looking at something more like the almost two decade economic slough the Japanese have been enduring.
Unless the American public proves that they WANT more of the kind of politics that got us here there is a fairly decisive first step away from the abyss and you and I both know what it is. But I am not so sure that the U.S. public as a whole is smart enough to figure that out.
3 comments:
Yes. A few not-so-pretty days ahead of us, I believe.
This makes me extremely sad. Where was the federal "bail-out" for New Orleans? *sigh*
."Where was the federal "bail-out" for New Orleans?"
And where is the bail-out for the mailroom folks at Lehman who are going to lose their jobs, right along with their CEO, but are the only ones who will have to eat cat food to survive?
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