Apparently, the stock market is the only indicator as to the health of the American economy. I can still pay my mortgage, business is good and I’ve managed not to starve since impending doom has become threat du jour. While there is no doubt that some industries are in a real bind, we shouldn’t be held hostage to the notion that our system will collapse without government intervention.
This is another case of “no one saw it coming, but everyone saw it at once”. Politicians are now saying they’ve been warning us for two years about this, yet for the life of me, I can’t recall a single instance. Our presidential candidates are now competing for the “I sounded the alarm earliest and loudest” award.
Suddenly, a 700 billion dollar government takeover of bad debt is the only thing between life as we know it and soup lines in shanty town. Even though no one has even a best guesstimate as to the value of “assets” the tax payers will assume, let’s round up to the next trillion dollars just in case.
I am struck by the stock market’s response while votes were being counted during the first attempt at passage. When approval seemed likely, the market responded favorably. When it seemed doubtful, the market plunged. And so the day went as the great manipulators became richer selling short and buying back.
The new game on Wall Street is extortion. In this game, Wall Street takes huge risks. If those risks pan out, they reap great profits. If the risks go sour, then they simply hold your 401K hostage until you bail them out. Remember government bailout = your tax dollars, or at least your assumed debt.
You really don’t have to be cynical at this point to believe that the same politicians who had oversight while this problem escalated will not come up with a plan that will fix it; in fact, I can all but guarantee that they will make things notably worse. How ironic that partisans finally came together to get something done – and it will turn out to be a disaster.