Barry Ritholtz has an extremely harsh indictment of our political leadership’s fecklessness on the economy:
The collection of ne’er do wells, clueless dolts, political hacks, and oh, let’s just be blunt and call them what they are — total Idiots — expands into an ever larger circle.
While the Republic burns due to the unsavory combination of incompetence, ideological rigidity, and crony capitalism, the fools and assclowns seem ever more determined to avoid any personal responsibility for the damages they have wrought. Instead, they flail about blindly, blaming everything and everyone — except their own horrific negligence.
I agree with some his comments:
There is a choice to be made: Either we regulate the Banks, or leave it to the vagaries of the free markets to punish those who trade with, or place their assets in the wrong institutions. But for God’s sake, do not give us the worst of both worlds — do not allow banks the freedom to make horrific but preventable mistakes (i.e., only lending money to those who can pay it back), but then expect the taxpayers to foot the trillion dollar bill.
Put me down on the side of additional regulation. Not a lot of additional regulation or nationalization but at least some regulation. I also think that Fannie Mae and Freddie Mac (FNMA and FHLMC) should be de-privatized but maybe that’s just me. I also think that insurance should be insurance and not some sort of giveaway scheme. That means that there’s got to be some relationship between premiums and risk but, again, maybe that’s just me.
I also note that he left criminals off the bill of indictment. I think we’re going to find out that out and out crime is a component, political corruption certainly is, and that the corruption isn’t limited to either party.
Some of what he has to say I disagree with:
Under Alan Greenspan, the Federal Reserve slept through the most reckless and irresponsible expansion of bank lending in history for reasons of ideological purity.
I don’t think it was ideological purity so much as a desire to keep the economy perking along by substituting home building for technology firms as the bubble economy of the 1990’s drew to a close. But when did that become the job of the Federal Reserve? Perhaps that’s what Mr. Ritholtz means.
I’ve also got to admit that I’m not seeing the sort of catastrophic meltdown that Mr. Ritholtz seems to be reacting to here in Chicago. Could the effects be affecting the coasts more dramatically? BTW that’s one of the biggest problems I have with federal bailouts of failing financial institutions. Bear Stearns was located in New York; IndyMac in Pasadena. I realize that the problems of both of these huge concerns has an impact on all of us and to that extent we should all be willing to lend a hand but since a lot of the wealth they generated went to New York and California, respectively, shouldn’t New York and California be proportionately more concerned about bailing them out? It’s not as though we here in the Midwest didn’t have problems of our own.
Hat tip: memeorandum