The eye of the storm.
Anyone who has lived in "Hurricane alley", Florida, the Gulf states
parts of the eastern seaboard - and has been through a Hurricane
knows not to go out into the "Eye". Even though the weather may
look likes it's clearing - the winds and rains can start up again from
the opposite direction with even greater ferocity than before.
Here Sandy B. Lewis and William D. Cohan express their own wisdom
concerning the current financial Typhoon we are jut entering the
middle of.
has not, been done so far.
you don't need."
They go on from here but I think you get the message.
It's a good read and I recommend it.
C
parts of the eastern seaboard - and has been through a Hurricane
knows not to go out into the "Eye". Even though the weather may
look likes it's clearing - the winds and rains can start up again from
the opposite direction with even greater ferocity than before.
Here Sandy B. Lewis and William D. Cohan express their own wisdom
concerning the current financial Typhoon we are jut entering the
middle of.
The storm is not over, not by a long shot. HugeAnd a few questions concerning what has, and more importantly
structural flaws remain in the architecture of our
financial system, and many of the fixes that the Obama
administration has proposed will do little to address
them and may make them worse. At another fund-raising
event, for Senator Harry Reid, President Obama said:
"We didn't ask for the challenges that we face. But we
are determined to answer the call to meet those
challenges, to cast aside the old arguments and
overcome the stubborn divisions and move forward as one
people and one nation .... It will take time but I
promise you, I promise you, I'll always tell you the
truth about the challenges we face."
Keeping that statement in mind - as well as an abiding
faith in the importance of properly functioning capital
markets - we have come up with a set of questions meant
to challenge a popular president, with vast majorities
in Congress, to find the flaws in the system, to figure
out what's being done to fix them and to get to the
truth about the difficulties we face as we set out to
restore the proper functioning of our markets and our
standing in the world.
has not, been done so far.
Six months ago, nobody believed that our banking systemWhy indeed...
was well designed, functioning smoothly or properly
regulated - so why then are we so desperately anxious
to restore that model as the status quo? Nearly every
new program emanating these days from the Treasury
Department - the Term Asset-Backed Securities Loan
Facility, the Public Private Investment Program, the
"stress tests" of major banks - appears to have been
designed to either paper over or to prop up a system
that has clearly failed.
Why is so much effort being put into propping up thoseAnd...
at the top of the economic pyramid - the money-center
banks, the insurance companies, the hedge funds and so
forth - when during a period of deflation like the one
we are in, any recovery will come only by restoring the
confidence of the people down at the bottom of the
pyramid?
Confidence will return only when jobs can be found and
mortgage payments are made.
Instead of promising the imminent return of good times,Like George Carlin said "Money you don't have on things
why isn't Mr. Obama talking more about the importance
of living within our means and not spending money we
don't have on things we don't need? We used to be a
frugal nation. The president should be talking about
kicking our addictions to easy credit, to quick fixes
and to a culture of more is better (and Congress's new
credit-card legislation, while perhaps eliminating some
of the worst aspects of that industry, certainly didn't
send the right message about personal finance).
Gas-guzzling S.U.V.'s, cigarette boats, no-income
mortgages and private jets should be relegated to the
junk heaps of history, or better yet, put in a museum
dedicated to never forgetting the greed and avarice
that led us so far astray.
you don't need."
Why is the morphine drip still in the veins of theAbsolutely. (and people called me sick and twisted)
financial system? These trillions in profligate federal
spending are intended to make us feel better again even
though feeling pain, and dealing with it responsibly,
would be healthier in the long run. It is time to stop
rescuing the banks that got us into this mess. If that
means more bank failures on a grander scale or the
dismemberment of Citigroup, so be it. Depositors will
be protected - up to $250,000 per account - but
shareholders, creditors and, sadly, many employees
will, for the long-term health of the system, need to
feel the market's wrath.
They go on from here but I think you get the message.
It's a good read and I recommend it.
C
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Absolutely rec'd! The questions it asks are the same ones that have troubled me from the start: "Why are we pouring trillions of dollars into banks that got us into this mess in the first place? And why are we entrusting the Banking Execs of these companies with oversight and application of these monies?"
One of the first moves these Wall Street Extreme Welfare recipients accomplished was to allow the bankruptcy and closure of Bear Sterns and then Lehman Brothers. It never seemed to occur to the media (or Obama and our feckless Congress for that matter) to question the conflict of interest in allowing the top Officers (or recently "retired" officers) of Wall Street banks determine who would be allowed to survive on Wall Street and who would fail. Watching these parasites eliminating the competition as their first order of business should have been enough to send many suits to jail. Instead, we simply gave them more money as needed, solely on their indication that such funds were needed.
It seems they have made fools of us all, and we will be paying the penalty for it for a long long time - unless we are fortunate enough to get a job on Wall Street.
June 8, 2009 5:35 AM | Reply | Permalink