Very useful. Makes me more convinced than ever that the bailout approach, more than just unhelpful is positively a great hazard to the world economy.
This financial crisis will not clear until the pricing mechanism clears the unpriced (and largely unpriceable) pieces of bogus debt paper that clog the system. Money thrown at this problem will only exacerbate the problem by adding a future inflationary dimenstion to this witches brew created largely by the United States House of Representatives and United States Senate over the past thirty years beginning with the Carter Administration.
Politicians of both parties are addicted any solution that allows them to avoid any short term political pain. Congressmen and Senators don’t really mind signing up for a solution that produces long term economic pain so long as short term political pain is avoided. Long term economic pain is easily sluffed off on the stupid masses who keep electing the unworthies of both parties and sheep and their children, grandchildren and generations into the future will always get to pay the butchers bill of Congress’ malfeasance.
Nothing good will come of any bailout. Any bailout will only make a bad situation much worse.
Dilbernomore:
I don’t know about such a sweeping condemnation of bailouts in general, but you are certainly right about the current situation. You cannot price the unpriceable by throwing money at it.
The current crisis sounds in a systemic failure in underwriting.
Marion, I stand by my blanket statement on bailouts because the law of unintended consequence always applies and is particularly pernicious when created within the context of the sausage making that is legislation. An focused objectively formed bailout may be efficacious when limited to a very discrete circumstance, but cold objectivity just doesn’t happen in any legislative process.
Very useful. Makes me more convinced than ever that the bailout approach, more than just unhelpful is positively a great hazard to the world economy.
This financial crisis will not clear until the pricing mechanism clears the unpriced (and largely unpriceable) pieces of bogus debt paper that clog the system. Money thrown at this problem will only exacerbate the problem by adding a future inflationary dimenstion to this witches brew created largely by the United States House of Representatives and United States Senate over the past thirty years beginning with the Carter Administration.
Politicians of both parties are addicted any solution that allows them to avoid any short term political pain. Congressmen and Senators don’t really mind signing up for a solution that produces long term economic pain so long as short term political pain is avoided. Long term economic pain is easily sluffed off on the stupid masses who keep electing the unworthies of both parties and sheep and their children, grandchildren and generations into the future will always get to pay the butchers bill of Congress’ malfeasance.
Nothing good will come of any bailout. Any bailout will only make a bad situation much worse.
Dilbernomore:
I don’t know about such a sweeping condemnation of bailouts in general, but you are certainly right about the current situation. You cannot price the unpriceable by throwing money at it.
The current crisis sounds in a systemic failure in underwriting.
Marion, I stand by my blanket statement on bailouts because the law of unintended consequence always applies and is particularly pernicious when created within the context of the sausage making that is legislation. An focused objectively formed bailout may be efficacious when limited to a very discrete circumstance, but cold objectivity just doesn’t happen in any legislative process.