ON THE NEW U.S. ECONOMY

Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.   –   John Maynard Keynes

As the U.S. economy falters due largely to lending practices that at best were idiotic and unethical and at worst illegal, the government has decided it needed to step in, and has done so at a potential cost of $700 billion. While not as much as the Iraq War has cost surely this must cement George W. Bush’s reputation as the worst American president of all time. This in spite of the inevitable stories in the press seeking to find good things to say about him as his administration slowly, ever so slowly, sinks below the surface.

The following are responses to the government’s bail out project from two of Politicsandpress’s correspondents.

Item from our European Correspondent:

“Hey, hey Ben + Hank finally came up with the plan to end the “turmoil”. Of course it involves having our grandchildren repay the Chinese who will fund it. It really is better than the previous final solution of getting all the worlds central banks to “inject” $180b into “the economy”. That was a good one. Some pundit summed it up for me: ”Having discovered that the brakes don’t work the bankers have supplied the car with a louder horn.” But this new one that Ben + Hank are going to “…work ALL WEEKEND perfecting” (the sacrifices these men make for us) is the one our grandchildren will pay for.

As I understand it from the press its premise is:
“…a comprehensive approach to address the illiquid assets on bank balance sheets that are … the underlying source of the current stresses in our financial institutions and financial markets.” (And all this time I thought the underlying problem was that Amercuns weren’t repaying their debts.)

Anyway, the way this will work is:
“…the new [taxpayer of the future] entity would “purchase assets at a steep discount from solvent financial institutions and then eventually sell them back into the market” through an auction.”

Cool. Buy stuff that is worth nothing (a debt that won’t/can’t be repaid) and later sell at a tooth fairy auction. Ben + Hank expecting to make money on this? Break even? Non-inflationary? They’re not even bothering to tell those lies.

So anyway, anyway, I am all for it cause it kicks the can down the road to a point after which I will have kicked the can.

Washington, DC responds:
The “market” just loves kicking the can. Investments go bad due to the ingenuity of the greedy little men in the world of finance [and the ignorance of the man of the street] with a large helping of gumm’t indifference – and oh yeah add the disastrous balance of trade – and the result is a $500, or is it a $800, billion bailout by our grandkids – ain’t capitalism wonderful? I’m hoping this will put a stop to the religious fervor of the followers of Milton Freedman and his laissez faire capitalism – well, that is too much to hope methinks, how about putting a dent in it.