LK Flip Flops and Waffles, Kind Of
Let’s forget for a moment that the Fed is using taxpayer money to bail out a private investment bank, usurping the free market that’s the foundation of our economic system, admittedly a massively imperfect system but the best that large groups of humans have come up with as long as they’ve been walking the planet. Let’s also forget that the fats cats whose irresponsible risk-taking precipitated this mess may no longer be obese (witness Jimmy Cayne selling out his BS shares for 61 mil rather than the 1 billion+ they were once worth) but the cats are still plenty husky.
That’s a lot to forget. But let’s do it for a moment.
Let’s suppose that, if BS (I prefer this nickname to “Bear”, for reasons that should be obvious) folded, it would have been the first in a line of well arranged destructive dominoes. In this case, the 30 billion dollars in possibly garbage collateral that we taxpayers are holding in exchange for the money we lent JPMorgan in order to entice them to bailout/steal BS, is a roughly $100/person insurance policy against the losses that might have resulted if BS imploded and led to a financial black hole in which assets beyond imagination were swallowed up.
Looking at it this way, my $100 portion of this risk ($30 billion divided by approximately 300 million US citizens) to insure against a possible economic catastrophe doesn’t look much different than a life or home insurance policy.
Accepting this as a valid reason for what looks suspiciously like a get out of jail free card is a stretch, but I’m willing to consider it if the Fed requires the irresponsible responsible parties at BS (and they and the financial community know who they are) to be stripped of their assets to the tune of retaining nothing more than the average American has saved.
If the Fed can usurp the system like a bunch of drunken super-delegates, then it has to work both ways. Rescue the institution, but punish the evil-doers. Iran and North Korea have nothing on these guys.
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what planet is loosekannon firing from. does this fascist looking chrome dome sit alone in his personal reichstag spewing idealogic bloviation. every loyal american knows the federal reserve bank is both independant and autonomous of the taxpayer funded federal government. it receives no federal funding, and is self supporting and profitable from it’s financial trades. loosekannon has no more exposure to the fed’s loan guarantee than if chase manhattan had made the deal…
get with the facts, trotsky. and stop listening to purple haze. comparing bankers who have made bad business decisions to the murderous and oppressive thugocracies of iran and n korea is not hyperbole but irrationality. and his demand to ‘punish’ the failed bankers as ‘evil doers’ shows his ignorance of the ‘business decision rule’ of american law. bad business decisions are not sanctioned in this country by anything more than the financial losses those bad decisions lead to.
another misfire for ‘loosekannon’. and unless he is referring to himself as an out of control fugue, cannon is spelled with a ‘c’.
clear thinker
ah, a bright and well written contrary post. we welcome the debate. the points above re the Fed are based on written charters and mandates, not how things are. de jure and de facto and all that. in terms of the country not sanctioning bad business decisions, can you say bailout? Chrysler? S&L’s? Bear? Plunge Protention Team?
oh and thanks for the spelling lesson. welcome to marketing ‘08, and that’s ‘08 with a 20 in front of it, not a 19.
hope you continue posting. a day without sparring is like a day without sunshine, or some such pablum. LK