Wednesday, October 01, 2008


Allahpundit's reaction to the House's rejection of the bailout Monday:
The wealth lost today on the market — just today — exceeds the cost of the bailout considerably.


OBloodyHell said...

> The wealth lost today on the market — just today — exceeds the cost of the bailout considerably.

1) It was paper money
2) It can be recovered as the market recovers
3) The socialism implied by a bailout, the restrictions associated with it, the whole overall set of regulations and stipulations and the government meddling, had the bailout succeeded? THAT would be FOREVER.

So it's not a nice trade off, but it's still very much a worthwhile tradeoff.

The financial markets have remained at least a little more free market than they would have been... or at least, have so far.

OBloodyHell said...

Also, from Hot Air:

The Dow closed the day down 777.68 points, or 6.89 percent, beating its previous record for an intraday drop of 721.56 points, set during the first trading day after the Sept. 11, 2001, terror attacks. Still, in percentage terms, the decline remained well below the more than 20 percent drops seen on Black Monday of October 1987 and the Depression.

“This is panic, and fear is running amok,” one trader told CNBC. “We are in a classic financial meltdown, and it’s panic-based. We’re seeing panic selling.”

Yeah, and right back up 465 the next day. That's panic selling all right...


And Assuming 1.1 trillion=777, then 687 billion=465.

Funny, I have yet to see much attention paid to THAT fact.

I think we have yet to see the full ramifications for this. But I point out, again, IIRC -- The DJIA is still over 10k.

That is, it's more than TEN TIMES what it was only 25 years ago, after holding steady at under 1000 for almost 20 years.

We've got quite a long ways to fall before things are "as bad" as they were even in *1990*.

It pays to look at things in perspective, and not have a knee-jerk reaction.

Things may plummet tomorrow. But the fact that they did not plummet today, despite the initial reaction, says that perhaps the extent of the need for this bailout isn't quite as wide or as deep as some of the pundits are saying.

Also -- that 7% drop is not even in the top 5, percentage wise.

That 485 point climb, though, IS the third largest one day point gain in history (yeah, apples-to-oranges, somewhat... more like tangerines to tangelos)

But maybe we don't need a bailout at all. Maybe we *should* do some specialty tinkering to soften the blow, and prevent any dominoes, but let the crap fall out of the mix, like it should.

OBloodyHell said...

Sorry, 485, not 465.

OBloodyHell said...

Also -- those credit numbers show that there isn't really a direct credit problem -- what there is, right now, is a lack of interbank trust.

So rather than do a bailout, perhaps what is really called for is something which does a little better at assuring interbank transactions. I don't have enough of a handle on the whole process (so, yeah, I may well be talking out of my ass) but from what I'm reading, it seems to me that, rather than buying bad assets directly, we should be encouraging banks to solve their own damned problems and making sure that one bank's failure will not affect the others which do business with it.

Not only is that far less socialist, it lets the market do what it does well, which is punish the incompetent and reward the competent.

bobn said...

I agree with OBH.

[In other news, man bites dog. ;-) ]

Something may be needed. The Paulson plan, even in Dem lipstick, isn't it. The added oversight is inadequate and would in all cases be after the fact of the crappy transactions Paulson will inevitably make. The "insurance" options are optional. The pricing and other key factors are still all for Paulson and/or his successor to decide.

Still unaddressed is the impact on the credit markets - or the impact on the dollar- of $700 Billion of *additional* US borrowing. Uncle Benny thought he'd get a freebie lowering interest rates to take the sting out of ARMs, but the dollar swooned *and* LIBOR has now disconnected from Fed Funds. These are the kinds of unintended consequences that come from winging it.

Time to shit-can this plan and start over - this time with help from respected outside economists - not just discredited hacks like Paulson and Bernanke.

Anonymous said...

Hey, it's just money. We've got our health, right?

OBloodyHell said...

> Hey, it's just money. We've got our health, right?

Well, to update Everett Dirksen:

A trillion here, a trillion there -- sooner or later, it adds up to real money.

(Dirksen's original "billion" seems inadequate, don't it?)



OBloodyHell said...


From the AP story about the bailout:

Add on the $3 billion funding dollop for rural school programs over the next five years. And another $8 billion over the same period in disaster aid, much of it for Midwestern states. And toss in unrelated legislation, far-reaching in its own right, requiring insurance plans to provide better benefits for mental health.

***What*** the > > F U C K < < is any of this doing tossed into an emergency bailout bill?


Remember in November:

Just Fire these bastard pieces of shit.

Fire all of 'em.


Carl said...

Is a line-item veto the only solution to pork??

OBloodyHell said...

> Is a line-item veto the only solution to pork??

Well, that or converting to Islam.


Anonymous said...

obloody, you are cute. If we all convert to Islam, the Islamic Koranthumpers will stop cutting our heads off.....maybe.

Don't Republicans ever apologize....even when they destroy capitalism?!

It's probably a good idea to start the country all over again. Let's have a new calendar that dates from a date in the future when we have established a new system that works to continuously improve life for all. That may require ONE MALE and ONE FEMALE as CO-PRESIDENTS.

May the Republican and Democratic parties dissolve themselves, rename themselves and select new names with the new parties being based on honesty. That might work.

Anonymous said...

We had better co-create fair, honest and effective economic, political and legal systems before the angry folks hit the streets. This probably means retaining the essence of capitalism, but removing the corrupt portions that serve only the interests of the top monied 2%. It probably means doing away with the Electoral College and letting DEMOCRACY work without interference from corruptors or Supreme Court justices. It probably means inserting truth, fact-finding, justice into the legal system in place of money buying verdicts. It probably means many changes. I suggest we start immediately to minimize the misery of the masses.