I'll admit it, I'm worried about this economic crisis. I know yesterday's drop was nowhere near the '87 crash (but today's a new day, and I think we can do better than that measly 7%, don't you?)
I applaud Congress for voting against that legislation. While I can see the point of anyone who thinks that bad legislation is better than no legislation, I'm a purist and believe the best course of action is for the government to stay out. I'm not going to pretend that solution leads to short-term equity, equality and puppies for everyone. It's going to be awful, but it is the fastest, and most efficient solution to recovery.
The current government solution will be worse, as it will be spread out over a far longer period of time with far less efficiency and some bizarre legislative add-ons. Besides, did anyone notice the $1.2 trillion dollar equivalent drop in the markets? Newsflash: you've already paid over and above $700 billion in ONE DAY. Who thought $700 billion was going to get this monkey off our back?? That number was chosen by a frantic Paulson in a mad dash to do something. At best, it is a shot in the leg to numb the pain, not an actual solution for the broken and bleeding injury!
We will see politicians talk about how globalization and deregulation created this beast, a species never before seen, and this time it calls for government intervention with bi-partisan support. A horrible idea we have seen before. The reality is that the Subprime Bundle Beast isn't different from other securities. It may have a far uglier face and will eat your 401K for breakfast, but it still functions like most of the species of securities we've seen throughout history. Let's face it, a malinvestment by any other name is still a malinvestment. We have a solution, if only we'd use it.
Ron Paul wrote a terrific piece on CNN today.
He says, "Using trillions of dollars of taxpayer money to purchase illusory short-term security, the government is actually ensuring even greater instability in the financial system in the long term."
He continues, "The solution to the problem is to end government meddling in the market...It is time this process is put to an end. But the government cannot just sit back idly and let the bust occur. It must actively roll back stifling laws and regulations that allowed the boom to form in the first place."
I'm afraid if we let bad legislation like this pass we'd further commit ourselves to playing a grotesque scene from the Twilight Zone where no one has learned from their mistakes and we repeat the interventionist mantra as if possessed. It's as if the Fannie/Freddie/AIG bailouts are old news already. It's almost as if we're saying, "Why dwell on the past, when there are bigger and better behemoths on the horizon?"
Does no one care that Citigroup, Bank of America, and Chase are slurping up dying companies to feed their blood-lust for being too big to fail? Can you blame them? They are doing exactly what they should be doing with the knowledge that the government will bail them out. They are displaying a new breed of moral hazard in action.
*****************************************************************
If you are against the bailout, take action: call Capital Hill at (202) 224-3121 and write your Congressman and Representative. The Congress site has a feature where you can search by zip code for your elected officials and post your comments directly on Soapbox, a place to publicly air your opinions. They want to hear from you - it is their job to listen.
I applaud Congress for voting against that legislation. While I can see the point of anyone who thinks that bad legislation is better than no legislation, I'm a purist and believe the best course of action is for the government to stay out. I'm not going to pretend that solution leads to short-term equity, equality and puppies for everyone. It's going to be awful, but it is the fastest, and most efficient solution to recovery.
The current government solution will be worse, as it will be spread out over a far longer period of time with far less efficiency and some bizarre legislative add-ons. Besides, did anyone notice the $1.2 trillion dollar equivalent drop in the markets? Newsflash: you've already paid over and above $700 billion in ONE DAY. Who thought $700 billion was going to get this monkey off our back?? That number was chosen by a frantic Paulson in a mad dash to do something. At best, it is a shot in the leg to numb the pain, not an actual solution for the broken and bleeding injury!
We will see politicians talk about how globalization and deregulation created this beast, a species never before seen, and this time it calls for government intervention with bi-partisan support. A horrible idea we have seen before. The reality is that the Subprime Bundle Beast isn't different from other securities. It may have a far uglier face and will eat your 401K for breakfast, but it still functions like most of the species of securities we've seen throughout history. Let's face it, a malinvestment by any other name is still a malinvestment. We have a solution, if only we'd use it.
Ron Paul wrote a terrific piece on CNN today.
He says, "Using trillions of dollars of taxpayer money to purchase illusory short-term security, the government is actually ensuring even greater instability in the financial system in the long term."
He continues, "The solution to the problem is to end government meddling in the market...It is time this process is put to an end. But the government cannot just sit back idly and let the bust occur. It must actively roll back stifling laws and regulations that allowed the boom to form in the first place."
I'm afraid if we let bad legislation like this pass we'd further commit ourselves to playing a grotesque scene from the Twilight Zone where no one has learned from their mistakes and we repeat the interventionist mantra as if possessed. It's as if the Fannie/Freddie/AIG bailouts are old news already. It's almost as if we're saying, "Why dwell on the past, when there are bigger and better behemoths on the horizon?"
Does no one care that Citigroup, Bank of America, and Chase are slurping up dying companies to feed their blood-lust for being too big to fail? Can you blame them? They are doing exactly what they should be doing with the knowledge that the government will bail them out. They are displaying a new breed of moral hazard in action.
*****************************************************************
If you are against the bailout, take action: call Capital Hill at (202) 224-3121 and write your Congressman and Representative. The Congress site has a feature where you can search by zip code for your elected officials and post your comments directly on Soapbox, a place to publicly air your opinions. They want to hear from you - it is their job to listen.
6 Comments:
I'm curious to see what you are thinking...