Come for the politics, stay for the snark.
This post is in: Domestic Politics
DOW up 500 on the news that all bad decisions by Wall Street will be taken care of by the sugar daddies on Main Street.
I really suck at optimism, but after too many years of insufficient cynicism…
*** Update ***
Ben Stein on my tv- “The big boys get the gain, the taxpayers get the risk. This is what Wall Street loves- something for nothing.”
Republicans are going to have to work on that socialism mantra. It just isn’t making any sense.
Comments are closed.
[…] See Also: Putting It In Words You Can Understand, Money matters, “Global Imbalances and the Crisis”, AIG, Neoclassical Economics: Mad Bad and Dangerous to Know, Just When You Thought it was Safe to get Back in the Bonus Pool, Unbelievable: My bank is buying two new top-of-the-line jets while being bailed out by TARP, An American Outrage: Bernie, AIG, and Us, Boards and Perks, and In Other News, Frat Boys React Positively to Plans For Free Beer and Get Out of Jail Free Cards. […]
Church Lady
Hell yeah! Money for nothing and the chicks are free.
schrodinger's cat
Aren’t you forgetting something important? We haven’t had a Tunch update in well over a week. We miss our weekly dose of Tunch.
demkat620
So, we paid the ransom?
Foxhunter
You mean the sugar daddies in ‘DC’, right? Because I know my Main Street ass isn’t really feelin’ the sugar daddy label right now. Maybe lackey, but not sugar daddy.
4tehlulz
This would have happened much sooner if the government just let the economy fix itself.
/Randroid
eemom
I humbly submit the below from Andrew Leonard at Salon, which strikes me as striking a sane note in all this hullabaloo:
http://www.salon.com/tech/htww/2009/03/23/krugman_and_geithner/index.html
Dunno if Leonard qualifies as one who knows his shit or not, but he always sounds kinda sensible to me (unlike, say, Greenwald, imo one of the most overrated bloviators in bloggerdom).
Shawn in ShowMe
I can see why the Street is relieved. It must come as a pleasant surprise that Geithner isn’t going to immediately nationalize the banks and the SEC won’t be throwing all the CEOs in jail. Or maybe the market is excited that there actually is a plan, even if it’s a flawed one.
D-Chance.
Who cares, as long as it provides a chance to move some of the stock portfolio into a safer vehicle at a time when the market isn’t at rock bottom? I’d rather move a few shares out with the S&P index at 820 than I would with it at 680. It’s still not the same as it was when the index was at 1400, but you take what you can get in times like these…
Ripley
Wait, you mean down by 500 points, right? Because I keep hearing the Market hates Obama.
And his teleprompter.
Pseudofool
Makes me wonder if Obama’s banking plan is simply political. Whether the plan fixes anything is second to whether it appears to fix things. And the dow moving up certainly does something for appearance.
jnfr
@eemom:
Andrew Leonard definitely knows his shit.
Ninerdave
Erick at RedState is having the same problem:
I highly recommend getting on The Red State morning briefing mailing list. It’s a guaranteed LOL in the morning and an endless supply of spoof material.
cleek
sounded pretty sane to me, too.
hear hear.
Trinity's Kitty
@schrodinger’s cat: I second that emotion!
AhabTRuler
I could agree that he is at times shrill and I can understand people who disagree with him (although I think that he’s got a pretty good bead on exactly how fucked we are most of the time), but I think that ‘bloviator’ is undeserved. There are far too many examples of conservative and liberal (and whatever the hell Greenwald is) pundits in the media who are far more guilty of the sin than he is.
Bill
I am probably mistaken, but hasn’t each ‘roll-out’ of a Geithner plan/solution resulted in a Dow Industrial spike?
Does this pattern (if true) represent something with which Geithner, and other ‘Obama economic advisers / insiders’ are enhancing / creating their higher wealth / bonuses?
John Cole
How anyone can write that in the comments of my website without the slightest hint of irony or humor is beyond me…
Evinfuilt
@demkat620:
Delivery in an unmarked brown paper bag seems to be taking place at this time.
Ransom, that really is the best description of this event.
eemom
@John Cole:
sorry, guess I don’t know you well enough.
Shawn in ShowMe
Dude, a typical Greenwald post would take up 75% of Balloon Juice’s front page. My man is all about The Bloviation.
beltane
Free beer? Hell, they’re being given a lifetime supply of free beer and free hookers, and permission to trash their hotel rooms every night for the next century. But I feel all warm and patriotic inside knowing that my kids have the honor of paying for this endless showing of "Bankers Gone Wild".
JenJen
I guess I’ve never understood how The Market = The Economy. I don’t feel much different than I did when we were
AhabTRuler
I mean, today, he is taking Howard Kurtz behind the woodshed and and learnin’ him.
Now I ask you: What’s bad about that?
JenJen
I guess I’ve never understood how The Market = The Economy. I don’t feel much different than I did when we were under 7000 or over 12000.
Again, never claimed to be an economist, but I’m to understand the markets rallying upon obtaining the nitty-gritty of Geithner’s plan means I’m screwed? On principle, or something? If World Market Likes = Must Be Bad?
I think a lot of this deserves a little patience, but I’m not blind to the fact that this could very well turn out to be Exactly The Wrong Thing. At the same time, I take offense to it being boiled down to "taxpayers are suckers."
AhabTRuler
Fixeteth.
anticontrarian
boy, i sure hope this is some kind of bait and switch, or that andrew leonard’s right, and it’s just obama setting up the chess pieces to pull the necessary nationalization (i mean, pre-privatization) in the end game. john got me all worked up with his description of the plan yesterday, but i keep getting reminded that obama is a very smart, crafty guy.
here’s hoping there’s another step to the plan, since i have to agree that this present incarnation, at least to my limited understanding of the way this stuff works, stinks to high heaven.
then again, maybe we could all pitch in and start a balloon-juice hedge fund, and then we could buy ourselves some of these here ‘legacy assets.’ i hear we can’t possibly lose.
eemom
@AhabTRuler:
nuttin. But he beats on that same old dead Kurtz horse in various forms all. the. frikkin. time.
If he could just write ONE damn post, ONCE, that DIDN’T use the word "Establishment," I’d respect him more.
Dork
Yawn. Or should I say…..Yuan.
Brachiator
@eemom:
Good stuff. I especially enjoyed the little dig at how much Krugman hates the Treasury plan. The next time Krugman appears on one of the Sunday pundit shows, I expect him to be wearing his Nobel medal, demanding that he be shown respect.
demkat620
@eemom: Let me help you out here. Our John loves his cat, hola fruitta and the Pittsburgh Steelers. But most importantly, he is a huge fan of the Twilight movie. :)
jibeaux
Ben Stein needs to work on having some sort of credentials to opine on economic policy that goes beyond having a B.A., being the son of an economist, and being in Ferris Bueller. Because he’s approximately as qualified on economic subjects as I am, and no one listens to me, nor should they. I’ve pitched ’em before, but I recommend the Planet Money podcasts.
Steve
Aren’t we well passed the point of worrying about if the taxpayers are going to get screwed? I mean, we KNEW we’re going to get screwed. Were there any alternatives in which the taxpayer didn’t get screwed? It seems the big question now is whether or not the administration’s plans would actually work and keep us from experiencing a "lost decade" ala Japan.
sstarr
Wall Street Down = Obama’s plans are bad for the economy, and the American people are losing confidence!
Wall Street Up = Obama’s plans are bad for the economy, and main street is mad at the fat cats.
Wall Street Unchanged = Obama’s plans are bad for the economy, and people are too frightened to do anything.
Etc.
randiego
Off-Topic rant
I’m busy at work today, but here’s some things that I’ve seen this morning (on the internets and in the comments section of this blog) that are driving me crazy:
1) Obama hasn’t communicated what he thinks happened and why he thinks it’s a problem.
Only if you managed to miss 60 Minutes, Leno AND his townhalls last week. He described the problems and solutions in detail, and said out loud that he plans to re-regulate everything. He was also very calm and very much in charge, as opposed to beady-eyed, evasive and marble-mouthed.
2. Geithner needs to be fired.
Why? This is just stupid panicky guessing. OBAMA HAS BEEN PRESIDENT 60 DAYS, and he trusts Geithner – he said so himself, and I am STILL WILLING to give him the 100% benefit of the doubt. These guys are pretty busy it seems, and I still don’t think anyone here really knows all the angles of what they are dealing with, including Paul Krugman – who is himself a pretty smart guy – but dude dial it down a notch!
I don’t know about the rest of the world, but I am backing the man 100%. For one, he has certainly earned it, and two the "Conservatives" and Villagers will attack given any/no reason.
He needs people’s support!
Keith
Does that include the 9-10 updates to said post, or are you talking about the original post itself? Those things have a shelf-life of 2-3 days on his site (at which point, I quit following the post)
John Cole
@demkat620: I’m off the Hola Fruta.
For now.
AhabTRuler
Um. He’s right about the "establishment."
In the past three years at Uni, I have heard the word "establishment" used 0 times ("Hair" just came on, "3-5-0-0," need to flip forward to "Walking In Space" then tell me about "establishment"), and many of the subjects discussed on this and Greenwald’s website are not discussed.
And I am a History and Political Science student.
Charity
Friend of mine who’s been in financial news for 30+ years says the S&P 500 is more indicative. It was up over 50 points today, and he says anything more than 25 is extraordinary. It’s just a momentary rally in the bear market, but it sure looks good.
t jasper parnel
@sstarr:
Bingo
JL
Has CNN talked about the gop memo that Obama is not a good communicator, is angry and laughs?
MikeJ
Dude, nobody overrates you. We know how bad you suck.
AhabTRuler
Now there is a bloviator.
Timmeh, was a first class bloviator.
Bring some idiot, I’ll show you a bloviator (I’m, looking at you, Friedman), not someone who actually knows what he is talking about.
gwangung
It’s a shitty plan, but as some people have pointed out—it’s a plan that can be done without the dubious aid of Congress. Nationalization is the plan of last resort, and it won’t fly unless it’s been SHOWN that all other plans won’t work.
Even when this plan fails, there’ll be pissin’ and hollerin’ from Republicans, but I don’t think the nationalization option is even possible without Obama going through this step first.
Think of it as a regrettable but politically necessary step to get from here to there.
AhabTRuler
Next you are going to tell me that Digby runs on at the mouth.
(Oh, say can you see
my eyes if you can
then my hair’s too short!)
Shawn in ShowMe
@AhabTRuler
No doubt, but in the Blogger Realm, the lengthy epistles of The Persistently Miffed Attorney at Law are a thing unique. Not that there’s anything wrong with being persistently miffed and writing 3000 words about it on a daily basis. I think it’s kind of cute.
mr. whipple
None that I can see, including nationalization. I can only hope that the screwing can be as gentle as possible, and that there’s some new regulations to keep the screwing as infrequent as possible.
AhabTRuler
=/
[Shrugs] Whatever.
geg6
As a (I think anyway) relatively intelligent, well educated lay person, I feel I have spent the last few months getting a grad level seminar in finance just following this financial crisis. And I still don’t have a clue as to what might or might not work. And I really can’t tell that anyone else does either. I read DeLong and Roubini and Stiglitz and Galbreath. I read the NYT, WaPo, WSJ, LAT. TIME, NW, and VF. And watch the boob tube. And blogs of all political colors. And still no one gives confidence like the MUP. And I’ve decided to go with that. I’m making a conscious choice, however naïve it may seem at the advanced age of 50, to believe he has my best interests at heart. And that that is all I really can ask.
Ash
I miss the days of my youth when I just knew Ben Stein as the guy on that game show.
AhabTRuler
Damn, can’t hit Wolf’s last note in "Sodomy" anymore. That’s what 15 years of smoking will do to your voice. I was hoping that it would come back since I stopped, but after more than a
yearyear-and-a-half (yay, me!) I think my falsetto is permanently trashed.[/music dork]
Steve
I miss the days of my youth when I just knew Ben Stein as the teacher from Ferris Beuller’s Day Off.
SF Bay
John,
Did you watch the whole Stein interview? He thinks the plan will work and we the taxpayers will get our money back.
This is all about confidence in the financial markets. This is a first step to regaining that confidence.
Shawn in ShowMe
Dude, you’re ancient. You must be like, over 30.
The Moar You Know
@Bill: It has been common knowledge since last week that the Geithner plan was going to be released today. You too could have been in on this rocket ride.
JL
@mr. whipple: President Obama said that he would announce additional regulations within the week. Bernanke has already talked about executive pay being tied to short term gains, instead of long term stability. Changes are coming and I doubt that Wall Street will rise 500 points when those announcements come out!
jibeaux
@John Cole:
Have you tried Ciao Bella? Gelato heaven inna tub.
AhabTRuler
I miss the days when he was just another failed Nixon hack.
But then, I miss having Dick Nixon to kick around; use to be he was the most outrageous Republican criminal, evar ! ! ! 1 !
Napoleon
@jibeaux:
Yes it is!
HyperIon
@Shawn in ShowMe:
For me, a bloviator must somehow project: "Wow, I AM a fabulous thinker."
Greenwald sometimes slips into that. Cole does not..ever. Thank you, JC.
schrodinger's cat
Being the minion of the mighty Tunch keeps John humble and honest.
bayville
Everyday is now opposite day for us peasants.
When the market goes up, that means that 99-percent of us are going to get screwed because we – the taxpayer – are going to be left holding the bag when the Economy eventually collapses.
As Commrade Cole correctly observes, the market is ballooning upwards because the Hedge Fund and Investment banking criminals realize their "risk" has been negated and it is thus safe to re-invest heavily again into these insolvent corporations/banks.
demkat620
@jibeaux: Oh, thanks for reminding me. Love. that. stuff.
The Moar You Know
@AhabTRuler: Right there with you. I’ve lost quite a bit off my upper range over the last decade.
There seems to be a second voice change for guys, a lot less noticable, that seems to kick in around age 30 or so, regardless of your smoking. You’ll notice the high-screechers (like Steve Perry, Roger Hodgson, or Geddy Lee) can’t hit anything the way that they used to.
(FWIW, Geddy also is/was a smoker, so that doesn’t help either)
Laura W
@jibeaux: (There’s a nice little Ben and Jerry’s thread going on over at Good and Bad if y’all care to join in.)
Edit: Or so I heard.
jdw
You know what that means, JL? I’ll get to listen to the left bitch for a week on how obama is a :
whore
toady
in the pocket of wallstreet
who promised change but didn’t deliver
and the righties bitch:
he’s a socialist
commie
mooslim
that is gonna destroy freeenterprise.
I can hardly fucking wait.
jibeaux
@Laura W:
I am not familiar with the Good and Bad. I don’t have what you’d call a LOT to say about ice cream, anyway. Except Graeter’s, which is an Ohio thing, is ohhhhhhh….
It’s good.
But I just really like ice cream in general. Usually buy Edy’s because it’s light but you can’t tell. And because I can’t get Graeter’s here.
Laura W
@jibeaux: Yeah, I’m with you. I don’t really have a lot to say about ice cream either.
I was referring to John’s open thread – Good and Bad
John Cole
This is my completely cynical take on things. You have heard of the “buyer of last resort,” right?
We, and I mean we- you and I and everyone here, just became the underwriter of last resort. We are now guaranteeing the big shitpile is not a big shitpile so the big guys can have another round of asset acquisition and spending. They are convinced that there are (to borrow a term from Atrios) ponies in the shitpile and that all the bad mortgages and other shit the bundles at the height of the bubble are not as bad as everyone thinks they are and are worth more in the long term. However, they aren’t convinced enough to use their own money, and instead will use a small fraction of their own money and loans from you and me to buy the shit they created in the first place. But don’t worry your pretty heart, because they can’t lose what little of their own stake they put up, because you and I are insuring it!
And the best part is that we are doing this before we hit the bottom of the housing bubble. What could go wrong?
If I am wrong, fill me in.
John Cole
Oh, and the best thing is that a side benefit is it is going to hose all the smaller regional banks who didn’t screw up in the first place.
JL
@schrodinger’s cat: Cat claws will do that.
John Cole
Also, SOCIALISM!
jibeaux
@Laura W:
Uh-huh.
I need to try some Ben & Jerry’s again, I have kind of neglected them. But I can’t cope with coconut as a dessert flavor, only as a savory. (I read it referred to as a "sweetened cuticle" once and that’s pretty much, exactly, exactly how I feel about it. It was Steve Almond, the pleasingly named guy who wrote a whole book about candy.) But something without coconut, in the spirit of scientific re-discovery, sure.
Gordon, The Big Express Engine
I think the Geithner plan is way too long on taxpayer subsidies for private investors and way too short on developing the oil shale and the electrification of the nation’s railroads.
AhabTRuler
Fixeteth.
Now for them, the US is "too big to fail!"
Jesus, I was just being glib, but when you actually look at that chart, its pretty fucking scary. You just gotta ask: When does it run out; when does the rest of the world run out of money and trust to lend us? And then what happens?
Shawn in ShowMe
@John Cole
I think you’re pretty much on target. Now the alternative being yelled from the rooftops of the blogosphere is "Nationalize now! And no, I have no idea what that’s going to cost and have no plan for figuring it out. But what could go wrong?"
Mr Furious
and
Two extremely important points I’ve hardly seen mentioned anywhere. Everybody’s so pissed off about the "taxpayer’s dime" part, they are missing the part about buying on the way down and wiping out small banks—which, truth be told, should be the ones being rewarded not killed.
DougJ
I don’t think the Wall Street reaction means anything. It doesn’t mean Obama is right when it goes down and it doesn’t mean he’s wrong when it goes up. The Halperin-Politico-Brooks rule — that whatever they say, the opposite is true — doesn’t apply here.
gwangung
@AhabTRuler: That was already the case (with India added); they were some of the counter parties for AIG.
Mr Furious
Seriously. If the federal government is going to pony up the ante AND cover the bet, I’d much rather they do it for a local or regional bank…you know, the players that are "too small" to get in the room.
AhabTRuler
@gwangung: Except we are talking about the actual Treasuries, so, yes, with AIG we are simply cycling numbers as we borrow then repay the same countries. But in terms of actual US Govt. foreign debt, China and Japan hold a massive amount of it, far above any other single country, and it has increased dramatically as we continue to borrow more.
There are lies, damned lies, and statistics, but when the numbers are staring you in the face, its hard to avoid a queasy feeling.
schrodinger's cat
Speaking of ice cream has anybody tried the mango ice cream Haagen Daz (sp?) makes? It even has mango chunks in it. It is my favorite frozen treat in the summer.
John Cole
@AhabTRuler: I just hope they serve szechuan chicken in the work camp I am assigned to when we can’t pay off our debts. I am just not a fan of the Hunan cuisine.
Also, does anyone know how to say “Where is the bathroom?” in Mandarin?
John Cole
@schrodinger’s cat: YES!
The Moar You Know
@AhabTRuler: Exactly. China’s into us for what…more than a trillion?
China’s now got a big fucking problem.
Joshua Norton
Congress needs some new ideas to put out there. I’d recommend:
Failed Asset Relief Troubles.
Working Asset Relief Triumph.
Buttf*cked Asset Relief Formula.
[delurk]...[/delurk]
The financial system we have is completely dysfunctional. I don’t know anybody other than the Wall Street fat cats who would disagree with that. Now me, I’m a radical; I would say: Burn down the house and start over from scratch.
Regardless of what the wingnuts say, however, Obama is the last thing but a radical, and I think all he wants to do is get the system functioning again, in its dysfunctional way, before performing major surgery on it. Make no mistake, he’s planning major surgery, but like working on a car, if it’s running at all, it’s a lot easier to tell what’s wrong with it.
My fear is that if things start looking just a little better, most politicians will be unwilling to vote for the structural changes that are required, on the "If it ain’t broke, don’t fix it" principle.
So I say, Burn down the house and start over, but I’m not president. As geg6 said upthread, I think Obama has our best interests at heart, and that’s a big improvement over the last eight years.
Rick Taylor
@John Cole:
Sounds about right to me.
TheHatOnMyCat
@DougJ:
Aw Doug, stop being sensible. There’s no future in that around here.
But anyway ….. this graphic called Anger Mismanagement.
So much for fauxrage.
Psst .. .don’t show this to John.
jdw
Ezra has a series of good posts up on this. WRT to pricing, he reports:
"But even if the public downside here is more galling than is something like nationalization, it’s not actually bigger. Quite the opposite.
"Many of the critics," one official sighed to me, "are underestimating the difficulty of their counterfactuals." Ben Bernanke does not appear to think the administration has the legal authority to forcibly take investment banks into receivership. What happens if a legal challenge disrupts the process?
Virtually no one thinks that Congress is willing to quickly offer either the legislation authorizing such an action nor the massive upfront money that receivership would require. Will Ben nelson and George Voinovich vote to take control of the banks? And what happens to the market while Congress is debating? And to Congress if the market dives?
No one knows if the Treasury Department has the technical capacity or simple competence to swiftly assume control of much of the United States banking sector. If Treasury seems unable to simply build out a banking plan and claw back bonuses, what makes anyone think they can run the banking sector?
No one knows how bad the downside is if you botch receivership, or if receivership doesn’t work. It is easier to abstractly argue the virtues of successful nationalization than contemplate the consequences of unsuccessful nationalization. As such, it should be the absolute last resort. And this plan preserves it as such."
The whole thing is here:
http://www.prospect.org/csnc/blogs/ezraklein_archive?month=03&year=2009&base_name=its_the_pricing_stupid_1
Michael
Cue the Lee Greenwood song.
John Cole
Just got this email:
I suppose I will just forward it to Geithner. He seems receptive to these kinds of proposals.
The Moar You Know
@John Cole: I’ve been to China. The absolute horror that is real Chinese cuisine is like nothing you’ve ever seen in any restaurant in America.
Maybe the leftovers section of a slaughterhouse, but not any restaurant.
I was there for a month and lost 20 pounds. Christ. I want to puke just thinking about it.
John Cole
@TheHatOnMyCat: Did I miss something? Or did you invent it in your head that I am all worked up about the AIG bonuses? Other than initial surprise that they would go ahead with them, I think I have been relatively silent about the bonuses.
JL
This is from Tapper’s blog and it includes a link where you can listen to it.
The reason we are not sure of the plan is because we didn’t use imaginary names. Ivan sounds like a Russian investor to me. lol
Joshua Norton
Turn the fraud squad and their forensic accountants loose and start tossing some of these AIG high rolling "whales" into the clink. They’ve already thrown other financiers in jail for a lot less.
AhabTRuler
@John Cole: Short of us, or rather US, doing something stupid (take yer pick), China will continue to lend us money, as they can take the long view and see that they will have us by the short ‘n’ curlies for a good long while.
Don’t bet on a work camp yet, but we are all going to be working for a fuck of a long time trying to fix this shit.
Or, of course, war, but I still think that’s, errr, mostly unlikely so far.
JenJen
@John Cole:
So is the Attorney General for the Southern District of New York.
Comrade Stuck
I expect our wingnut friends will get on board with side bennies like this. Anytime you can hose the little guy, they are all in. One more roadblock removed for the nirvanic dream of an American Jesus Corporatacracy.
To George Bush Foo and Thanks For Everything Julie Newmar.
Rick Taylor
@John Cole:
Oh, and it looks like that DFH and Bank of America’s chief investment strategist, agrees with you, more or less. Via Atrios.
le consolidation.”
demkat620
Okay, I can’t take anymore. I need a valium just to watch Tweety.
"Big News, for the first time, tonight, Wall Street likes Barack Obama."
I swear to god when you look in the dictionary under insipid there is a picture of Chris Matthew’s face.
Shoot. Me. Now.
geg6
John, I understand exactly the points you make. Believe me, I’ve been screaming and waving my hands in the air and practically weeping with frustration and despair as all my learning has finally gelled. But all my reading has to also be integrated with my other knowledge, one of which happens to be the art of politics. And I’m not sure the alternatives are doable in the current environment. I’m well aware of the need for urgency if nationalization is the only solution, but that is the most difficult path politically and people like us and small banks and all the rest will be as badly damaged over the short run anyway. If this works, there’s time left to try to get preventive fixes later. If it doesn’t, then nationalization becomes THE viable path. I really don’t think they had a real choice here politically since action was being demanded whether by our Wall Street overlords or simply by events.
Joshua Norton
Chump change. I got one for $45 million and another for $72 million. Apparently there’s a lot of stranded royalty and cash strapped relatives of dead CEO’s in the world. And they all seem to have my email address.
John Cole
@geg6: I don’t think there are any good options. It is like everything else.
Obama touched on this last night:
I am in no way, shape, or form convinced that nationalization is any better. The thing I worry about with nationalization is wiping out everyone’s retirement.
Martin
Nobody does.
This is Chernobyl. All the good solutions are in the past. All we can do now is climb up on the roof and chuck fuel rods back down through the roof, hope that will allow a better plan, and pray that our kids aren’t born with 3 arms.
As a nation we suck at keeping our eye on the ball. As soon as things look too good to be true, we just assume Baby Jesus will be looking out for us, block out all of those bad thoughts, and make ourselves feel happy by charging up a new TV. Welcome to a faith-based nation.
Comrade Stuck
@John Cole:
LOL. It’s boiled Ratmeat. Just tastes like chicken. But the Rice is really Rice.
@John Cole:
Those are "Legacy Bonuses" man. Git with the program you "Fatale Populista".
geg6
And that’s exactly why, John, I’ve decided to go with the flow for once in my life. Obama is a clear thinking realist. Much more so than I, apparently, as he’s proven many times. I’ve been too cynical in my past (unlike you) and I have to finally believe in something or someone. He’s shown me he’s better at choosing the best of difficult options, the outcomes of which are opaque at best. I’m going to believe, based on what I know, that he’s doing that here. And that makes me feel better. Won’t work for everyone but I’m not as frantic today and that’s good for me.
Zifnab
@John Cole:
Then everyone would become increasingly reliant on Social Security, which might compel Congress to raise payments, remove the income cap, and stop raiding the damn thing. The last thing people want is a stable, affordable retirement fund when they can enjoy the dizzying highs and cavernous lows of the stock market roller coaster. :-p
I mean, I know what you’re saying, but the nature of the 401(k) is risk. We couldn’t protect the Enron investors or the Madoff clients or the Pets.com speculators from having their savings wiped out. Why does it suddenly fall on the US Government to protect the stock holder when the CEO and his board won’t?
Gus
Couldn’t disagree more. I think the man is indispensable, if only because of the rigor of his arguments. His posts are long precisely because he doesn’t miss anything. I don’t read him unless I have the time to devote to really thinking about what I’m reading.
Comrade Stuck
@geg6:
I agree with you geg6. Nationalization for this society will be like downing a huge bitter pill and washing it down with Castor Oil. It is the last of last resorts, and I suspect things will need to get much worse until we take that step. Maybe they won’t, and all of us are wrong about the insane plan of keep doing the same thing and hoping for different results. I sure hope so, but trying to fix a broke bulb by screwing it in ever so tighter seems futile, and likely is. We shall see.
Bhall35
@AhabTRuler
Have you considered going to NY to see the current revival on Broadway? It was pretty highly praised when it was done in the Park last summer.
srv
@John Cole:
Until Milo contracts them to carpet bomb all of us.
geg6
Yes, Comrade Stuck, nationalization seems the quickest and best fix, economically speaking. But the politics are daunting. And I fear impossible right now. Until that changes, this may be the "best" solution. Not that it’s really a solution. But it might be and, most importantly, it can actually get done.
Shygetz
@SF Bay:
No, it’s really not. The lack of confidence is due to poor underlying fundamentals. If you restore confidence without fixing the fundamentals, all you are doing is reinflating the bubble.
geg6
Yes, Comrade Stuck, nationalization seems the quickest and best fix, economically speaking. But the politics are daunting. And I fear impossible right now. Until that changes, this may be the "best" solution. Not that it’s really a solution. But it might be and, most importantly, it can actually get done. And let me add that we’re screwed either way. Nationalization isn’t really any less expensive. It does, however, allow the mess to get cleaned up faster. But this mess is so big that may just be relative.
TheHatOnMyCat
@John Cole:
It was a subtle point, and I didn’t make it all that clearly, so I can’t fault you for not seeing it.
Let’s put it this way: Maybe fostering a blogload of people who will bark at anything that looks like a Wall Street insider making any gain from the crisis remediations isn’t the smartest thing to be doing right now.
Maybe we aren’t focussed on what’s important. Is that possible?
The other thing is, exactly how am I supposed to read a guy whose daily disclaimer is "I don’t really know anything about this stuff, but …."
I take you at your word. And as far as the arcane technicals go, I don’t know much about it either. What I do know is that there is a bigass problem and the meter I’m looking at is called Unemployment in the United States.
When that meter heads into double digits and threatens to break 15%, we are in the shitter. Nothing else matters to me. I don’t care who got bonuses, I don’t care what they call the toxic assets, I don’t care who in the Manhattan Ivory Towers is making out thanks to the bailout money.
I only care about the result. And the best result is, a relatively early unemployment peak, a plateau, and a decline in unemployment as soon as possible. That’s it. Whatever gets me that, good. Whatever doesn’t, or gets in the way, or muddies the water, or distracts attention from that, bad.
That, and the Baby Jesus, are all I have left.
Comrade Stuck
@geg6:
If it were the quickest and best fix, I’d be happy. It will be neither quick, nor the best imo, though in the long run, hopefully, the surest. What it looks to be , increasingly however, is the ONLY fix. No illusions from me, it will be ugly and painful for quite some time, and I hate the very idea of it. And the politics will follow behind us down the rabbit hole, until there is no where else left to go.
geg6
Sorry for edited double post. But it’s confusing doing this on the Crackberry. /doofus
Shawn in ShowMe
Where is it written that you can’t restore confidence by getting the credit market flowing again WHILE working on fixing the underlying fundamentals?
Dennis-SGMM
I feel really dumb: for years I believed that "free market" meant something other than "free of consequences."
Laura W
@Martin:
So good it hurt.
TheHatOnMyCat
Wow, now THAT’S a sales pitch. Does it also cause hemmorhoids and blindness?
As I said on our other exchange today to some other guy over there, all you left off is that the ugly denoument plays out with a new Republican president in four years.
Good times for all! Hey, I am ready to put a NationalizeHereNationalizeNow sticker on my car, right now. You have sold me.
AhabTRuler
@Bhall35: I hadn’t until now.
Ninerdave
@John Cole:
Did you catch this at TPM?
Josh says:
He then quotes an email that starts:
Comrade Stuck
@TheHatOnMyCat:
Take some Geritol and get some sleep. The Collective will look better in the morning. And no more 100 dollar caviar for you, Mr. Bourgeoisie lackey.:)
geg6
Comrade Stuck, I mean best and quickest in that it is, as you say, the most sure fix and one which allows just one actor to be doing the cleaning up (the govt.). And I hate the very idea, too. But the politics aren’t there yet. So this what we have. For now. I’m gonna just flow with it and hope for the best. I can’t live with the despair otherwise.
ksmiami
DO NOT WATCH PUNDITRY ON TEEVEE it is hazardous to your brain cells
Ash
@Ninerdave: That is pure gold.
Corner Stone
@John Cole @ 68
And I would argue that they aren’t convinced there are ponies in there but rather they know for a fucking certain fact that there’s nothing but shit in that pile. To them it doesn’t matter.
Whether there’s value in the LT, or nothing but a pile of ponie poo, they know damn good and well exactly how they’re going to make out on this one.
TheHatOnMyCat
@Comrade Stuck:
Hundred dollar caviar? I am down to buying cat food on sale here, thanks to IAMS raising their price and reducing the content of their package so that their fucking ground up sheep entrails now are costing $2.50 a pound, which is what am paying for bottom round roasts at Safeway.
The cats can go out and catch some pigeons and start feeding ME.
LanceThruster
As long as none of the free beers goes to poor people as they did not earn it like us fratboys. Give them the get out of jail cards though (but not ‘free’) as they just go there for "3 hots and a cot."
The Moar You Know
I’ve read, somewhere over at Calculated Risk, that if you used the old method for caluculating unemployment that we’re over 13% and still climbing.
I think people still have no idea of just how bad of a situation this is, and even less of an idea of how bad this could get if left to run its natural course.
Litlebritdifrnt
I keep thinking about this, and trying to get my head around it but I am to finance as a 600lb gorilla is to ballet dancing. However, the one thing I keep coming back to is that all of this money that everyone was talking about suddenly "disappearing" was not real money, I mean it didn’t exist in reality but was "on paper" therefore if you opened your 401K or whatever when the market was at I don’t know 8,000 and your net worth was whatever when the market was at 13K then yeah, sure your 401K was worth however many dollars more but ONLY on paper, and of course that all depended on all the people who owned stock in a particular company being able to sell at the top price at EXACTLY the same time, which of course would never happen because as soon as the first people started selling the stock would take a nose dive. I think the entire scenario is simply a fairy tale, it was money only on paper and profits based only on a completely unrealistic scenario.
Now if you put your life savings in the stock market when the market was at 13K then sure, you took a bath, but every financial adviser in the business told people to diversify, stocks, bonds, mutual funds, CDs, cash etc., if you CHOSE not to do so then I would think that would be akin to throwing everything on red 40 at the casino.
Like I said I know nothing but this is my take.
t jasper parnel
This is why it is better to wait for Ambassador Trentino to speak than it is assume you know what he will say.
Comrade Stuck
@TheHatOnMyCat:
Try some Mountain Caviar, a delicasy commonly referred to as Soup Beans, or the elitist, Pinto Bean. They are cheap and plentiful, and will keep you regular.
** cats won’t touch em though.
Comrade Stuck
@geg6:
I’ll be in the boat next door.
TheHatOnMyCat
@Comrade Stuck:
I’m already regular, but thanks.
I guess I can buy government cheese blocks for the cats, when the food chain is nationalized.
Bhall35
@AhabTRuler
We’re planning on seeing it, having missed the Park production, but we also saw it @ City Center in 2001, when it became one of my favorite shows of all time (the score and lyrics, as you’ve mentioned, cannot be underestimated for their excitement or relevance). My gateway drug to the show is also highly recommended. Harvey Fierstein does "Air." Enough said.
Montysano
@The Moar You Know:
There was a time… not too long ago…. when we all would have thought "We owe China $1T? ZOMG!!". Now, $1T is just a day’s work in Washington.
Comrade Stuck
OT sort of
I think I’ll move to Schenectady and get a jump on the coming chaos.
Cain
@schrodinger’s cat:
Have you tried Trader Joe’s Mango and soy ice cream? Holy shit, it’s so good. The soy stuff is really creamy, you can’t believe you’re eating some soy product. Even if you don’t like soy milk, it doesn’t have that nutty flavor from what I can tell. Of course the mango hides that part. Try it though!
cain
Brachiator
You make a very good point here. However, the conventional wisdom is that unless the bad assets are unloaded somehow, somewhere, the credit markets will freeze up.
Note here that the issue is not about separating the good banks from the bad. Nor is it really a question of nationalization vs whatever Treasury proposes. The fear is that if you let bad banks collapse under the weight of their debt, the entire global system will collapse. There are some (and not just libertarians) who believe that if you let the bad banks fail — or make a stronger deal with them in exchange for bailout money — then new credit suppliers will arise to take their place, perhaps even new types of institutions.
But nobody is willing to take a leap into the unknown on this one. But the key issue is that it’s not just about banks, but about financial markets.
If you do a bit of a google search for stories, you will see how the unofficial credit market has risen up to provide credit, from pawn shops, to organized crime, to payday loan places (in Ireland, payday loan venders will come to your home but charge 190% interest).
Comrade Stuck
So will organized crime, but they will charge you a kneecap.:)
Chuck Butcher
@TheHatOnMyCat:
Hmmm, Oregon Median Income Jobs that would pay?
4100?
Nah, I’m not outraged, I’m about 9 months from burn ’em out of their homes, a teachable moment – it is fucking dangerous to be that greed driven. Not that I limit my "irritation" to that small cadre.
Brachiator
@Comrade Stuck:
"Goodfellas" was on again this weekend. There was a great sequence in which a local guy asks the Mob to partner with him because he is short of cash. The mob runs the restaurant into the ground, using credit to buy goods which they then sell on the black market. When they can’t get any more credit, they burn the place down and collect the insurance.
Even organized crime has a business model.
Comrade Stuck
@Brachiator:
Sounds a bit like the Wall Street business plan.
And we are the Underwriters.
anonevent
From the slate article:
This is what the Repubs failed to realize in their zeal to have the proletariat invested in the market: Once everyone is invested in wall street, the government will be obligated to do everything in its power to save it.
Martin
Yep. We’re accustomed to certain types of things getting taken care of, but when the shit really hits the fan, a lot of that stuff just isn’t big enough to take all of our attention so we let it go. But the public is still used to it getting taken care of, and now it’s not, so we scream ‘foul’.
Let’s put it in different terms. Geithners job is to make sure the country doesn’t lose another trillion dollars this year. Assuming the guy never takes a day off, anything that will take a day of his time and loses notably less than $3B isn’t worth his time. So, he can justify about 30 minutes to focus on $165B worth of bonuses. Now, his staff can focus more time on that, but he can’t – and he doesn’t have much staff yet, so that kind of thing just has to slide. How much of his time have the rabble-rousers already eaten up? More than 30 minutes? I can guarantee that.
Shorter Martin: the house is on fire and we’re taking up the fireman’s time screaming at him because he parked the truck on our petunias. We’re totally missing the scale of Obama/Geithner’s job right now.
Cat Lady
@Brachiator:
Sopranos had the same scenario with the Scatinos. Tried and true, apparently. We are all Sicilians now.
Comrade Stuck
@anonevent:
And Comrade Joe the Plumber never saw it comin’.
Just Some Fuckhead
Martin is taking all the good comments.
Fucker.
prospero
@randiego:
You’re right. It is every patriotic citizen’s duty to stand unquestioningly behind the President, no matter what, because he’s the President. Our President. And we are good Americans. Ok, let’s roll!
AnneLaurie
Hey, that’s why "we" spend as much on "our" military as the whole rest of the world combined, amirite? Not to mention the only *sacred and sacrosanct* Amendment, namely the Second! Because there’s nothing like heavy artillery to buy all the respect we think we’re ever gonna need, especially when that artillery is combined with our own many-faceted red-white-and-blue All American Crazy!
guest
@AhabTRuler:
you know how in the olden days people would buy victory bonds? why can’t we do that now? a campaign for citizens to buy back some of that foreign debt.
Jim
Actually, if this were a class in economics the best approach may be to let everything fail and then start up again from the rubble. However, there is a real world out there and real world consequences to any action. It may well be that Geithner’s plan sucks, is a sop to the rich, and will ultimately bankrupt us. I have real doubts about Timmeh’s judgment and where his loyalties lie. On the other hand, if his plan does nothing but soften and delay a huge slump, it may be a winner from that standpoint alone. There are countries out there that are close to failing. Pakistan, where terrorists and nuclear weapons abound, is teetering on the edge. If the global banking system collapses, it’s a pretty good bet Pakistan goes down, thereby creating a potential shitpile to rival all shitpiles. Yes, we may be postponing the inevitable, but the longer it gets postponed the less inevitable it may become.
guest
@TheHatOnMyCat:
why grandma, what big balls you have.
AhabTRuler
Because the Victory bonds were a way of tapping the vast amounts of cash that Americans had stashed in the Banks, with its traditionally high rate of personal savings.
If, nowadays, you see an American population with a traditionally high rate of personal savings, let me know.
guest
@AhabTRuler:
my god, some of the countries we are borrowing from don’t even take care of their own people. the shame, the shame.
p.a.
One thing I love to follow is the mutation of topics in blog threads. From what I’ve seen here at BJ things seem to stay on track for the most part, with some tangents to any thread as might be expected. Another example, at Eschaton a topic can fly off the rails by the 3rd comment, never to return. This isn’t a criticism, just an observation.
I think I’m a fairly regular visitor here, and a sporadic commenter, but let me ask if I am the only one here who finds this thread, which I characterize as combining comments about the potential collapse of the American financial system (and possibly the economy as a whole) with comments on ice cream and cat food,
a rather odd one for BalloonJuice? Again, not a criticism, just an observation.
Comrade Stuck
@p.a.:
I reckon we’re just Punch Drunk. It’s going around.
someguy
If Ben Stein is against it then it must be a good thing.
libarbarian
I’ll take all the freedom I can get.
If the constitution had an amendment guaranteeing a right to pick wedgies I still wouldn’t be as quick to get rid of it as some people are to get rid of the second.
Comrade Stuck
Politico
Reviews are in: Geithner clears the bar
”
Thanky be, Baby Jeebus. We are in like Flint.
Comrade Jake
@p.a.:
That would be a BJ feature, not a bug. Come by more frequently and you’ll get it.
I don’t think I’ve ever learned a damn thing reading Eschaton or the comments over there. This place is very different.
Laura W
@p.a.: Since the election, it’s pretty much been All Republicans/All Economy/All Villagers All The Time around here, IMO. How many different posts and comments saying just a couple versions of the same thing on those same topics can you (OK, me) stand in a day, really? Without needing to interject a bit of the absurd, the off topic, the furry, the snarky, the recipes, the pet grooming tools, and the care and feeding of……condiments?
I thought last night’s thread was one of the most bizarre around here in a long time, for many reasons. Not the least of which was BOB setting the tone early on with his very controversial theory on pickle preservation. It evolved into the never ending debate on catsup v ketchup; Hebrew National’s attempts to hypnotize us with some freaky biblical numerology voodoo; gardening; and lord knows what else. I’m not at the point where I can re-read it, since I was there as it unfolded. I still need some distance.
(Edit: and what Jake said. Also.)
Church Lady
China is starting to get really, really nervous. Today, Zhou Xiachuan, the Governor of the Central Bank of China, published an essay suggesting that the US Dollar should be replaced as the international reserve currency. He is proposing a new global system controlled by the IMF. Isn’t this similar to what some of the European members of the G20 have been rumbling about? This sound kind of scary.
I guess when you print trillions out of thin air, like Bernake has done, and there are going to be deficits as far as the eye can see, foreign investors start to worry about the value of their investments in dollars. I have the sinking feeling that we are even more screwed than we think we are.
Comrade Stuck
@Laura W:
Cole, would you please get this woman a furry animal thread. Or at least one on different Kale recipes. Thank You sir.
Don’t worry Laura, relief will be arrive shortly. If you want flying beauty, You can always check out my Hummingbird photostream at flickr. Also have a hummer group and blog. That’s were I found solace from crazy ass politics.
Church Lady
Thinking about it, if we are going to wind up having Carter era inflation, I think I should get in line for gas early. Man, I miss the 70’s.
Laura W
@Comrade Stuck:
I am so leaving that for Fuckhead.
(PS: Your shots are gorgeous!)
Laura W
@Comrade Stuck:
This one is especially amazing!
Comrade Stuck
@Laura W:
Thank you. They will be returning in a few weeks, and I will spend hours chatting with other hummer lovers all over North and South America about them. And not a word on politics.
Adrienne
@Church Lady:
That’s really not a concern right now, so if that’s what is scaring you then you truly have a fundamental misunderstanding of what’s going on.
Over the past year, $11 TRILLION in American household wealth has disappeared. This is a root of the problem from which all the other problems flow. The credit market freezed because there was literally NO money – not because the asshole bankers refused to lend it – they realized they didn’t have any. The banks realized it around the same time that average Americans started to realize it and everybody – companies and individuals alike – got really tight to hold on to whatever money they had for fear they’d lose more, which is exactly what WILL happen when everyone stops spending. So, DEFLATION is closer to reality than inflation. We can avoid painful inflation relatively easily by being careful about how we administer the money supply on the way up. On the way down, money is what we need.
On Republicans: GDP and growth is actually a pretty simple formula: Consumer Spending/Consumption ( C ) + Government Spending (G) +Business Investment (I) + Net Exports (E) = GDP. Now, consumer spending tanked because consumers lost 11 trillion in wealth. Business Investment is down because banks aren’t loaning money for them to make such investments. Exports are down because we don’t have any money, so we aren’t buying, so demand is down, and factories are operating at less than full capacity and making less things. So, the ONLY part of the equation that’s left to do anything is government. Yet these idiots want government to do even less! They want to destroy the ONLY thing that is stopping GDP from totally nosediving.
It doesn’t take a fucking genius to realize that when 3 out of 4 variables are tanking, you don’t get the equation to balance by making the 4th variable tank too!
J. Michael Neal
According to TPM, there is a distinct lack of Democratic legislators criticizing the Geithner plan. This is a smart move. If they did, the obvious question would be to ask them what legislation they’ve sponsored that would provide the authority to do anything else.
J. Michael Neal
Yeah, but most people can’t access it from work.
Comrade Stuck
@J. Michael Neal:
You must be making a statement. Wonder what it is?
Crickets……
That’s what I thought.
Laura W
@Comrade Stuck: I just looked at a bunch more of your shots and am really wowed by how good you are! That is quite a portfolio and a massive following you have there. Yer like some sorta flickr celeb or somethin’.
Who woulda thunk that our Stuck was such a talent?
Er, I mean, Great Job!
Comrade Stuck
@Laura W:
thank you , Laura
Comrade Stuck
testing
tickety
@The Moar You Know: @The Moar You Know: You’ll notice the high-screechers (like Steve Perry, Roger Hodgson, or Geddy Lee) can’t hit anything the way that they used to.
Obviously you’ve not seen Hodgson in concert lately…
Comrade Stuck
@Laura W:
Got moderated for using a different email
But, Thank You, Laura.
Rick Taylor
@J. Michael Neal:
There’s a big difference between being a commenter on a blog, a pundit with a voice in a paper, and a congressman. Writing here I can say whatever I like and not worry; it’s not like anyone important is going to even pay attention. But if I were a congressman with misgivings, the President and the fed are the only ones who can come up with a game plan address the crises, and I’d try to influence them, quietly. A lot of Democrats weren’t thrilled with Paulson’s plan even after the compromises, but if the choice wasn’t between our plan and the Bush administration’s plan; it was between the Bush administration’s plan and nothing, and that persuaded people. That argument becomes even stronger when the president is of your own party.
Redhand
Frankly, I found today’s news depressing as shit. The NYSE goes up 500 points because the fix is in and we’re all supposed to see Geithner as some kind of genius? Ditto that arrogant scumbag Larry Summers, who killed regulation of derivatives and was thus instrumental in creating this clusterf*ck? He was all puffed up on the PBS Newshour tonight boasting about what a great recipe the Obama Administration had cooked up (warmed over Paulson cash-for-trash) and I wanted to reach into the tube and throttle the sonofabitch.
I’m really into Hey Paul Krugman territory at this point. Obama has the wrong prople running this show. At Treasury it’s like we’re still in the Bush era.
Comrade Stuck
@Rick Taylor:
Exactly. I feel pretty certain, the final word won’t include the American Taxpayer in for 90% of the risk. It will be done quietly, or legislatively, but that number will come down.
Mr Neal is full of shit.
J. Michael Neal
@Comrade Stuck: I’m not sure exactly what I’m full of shit about.
kay
@Adrienne:
That’s really not a concern right now, so if that’s what is scaring you then you truly have a fundamental misunderstanding of what’s going on
It’s political, Adrienne. Republicans are well into week 2 of the budget battle.
Here’s the argument they hope to use: the financial crisis makes it impossible for Obama and the Democrats to push a broader domestic agenda. That would be "irresponsible" and would "bankrupt" the country.
They would have opposed any Obama agenda, in any event. This gives them a way to do that. This is about the budget, and ideological priorities on spending. We know it’s not about "spending", because conservatives spend like sailors on their own agenda. It’s political.
Comrade Stuck
@J. Michael Neal:
Just as a general observation on my part. Plenty of people, I’m sure, feel the same about me. Maybe your one of them..who knows, or cares in the ethers?
Or maybe I just don’t like you is all. Doesn’t much matter, does it.