Wednesday, February 11, 2009
Circling the Drain While Fools Ask for Stock Tips
Martin Wolf ponders the possibility that the Obama Administration is already a failed enterprise for not being bold enough.
Meanwhile, the two men who warned the world that the financial system was broken before it broke, who have suggested solutions, are asked about stock tips by CNBC anchors. Paul Krugman compares their ordeal to a Monty Python sketch. We are seeing two disconnects with our government and our news media. This begs the question of asking whether our government and news media are as broken as our financial system.
As Roubini points out, it's not a question of nationalizing the failed banks, it's when nationalization takes place. The longer that decision is postponed, the more damage to the economy takes place. As Taleb points out, cash is king. Stocks are too risky and the people who have caused all of this mess are still in power. Throw the bums out by nationalizing the failed banks. The FDIC knows how to do this. Extremely wealthy people got themselves into this mess. It would be funny to see free market capitalists' ideals be realigned with reality except for the fact that these professed capitalists want the people whose retirement funds they've destroyed or damaged to bailout their jobs and their fortunes. For the record, I'm a regulated market capitalist. Governments should regulate markets to preserve commons and level economic playing fields which is what markets are.
Those who shout the loudest about "socialism" are often those most protected by subsidies, tariffs or other regulatory barriers.
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