Sunday, September 21, 2008
The Big Bail OutWall Street sleeps soundly tonight, with the big rescue plan in the works, the meltdown of the markets last week is a nightmare that is receding, and all good traders are looking forward to Monday morning, a latte and an onion bagel with cream cheese, and more money to be made. They are not in the least bit disturbed that the taxpayers are picking up the tab, all is well, the casino is open, and the game goes on. And regular Americans are getting ready for a new work week, watching Sunday football, making the kids dinner, feeling a nagging worry that they can't quite define.
The thing that worries me, and it's not a nagging worry, but one that carries a lot of weight, is the bail out itself. Maybe Wall Street, and the rest of America thinks that the Treasury Department has $700 billion sitting around in a bank account somewhere, and they are going to hand it over to the investment banks and money market funds, and everything is going to be just peachy. It's not that simple. Congress has to first borrow the money, raise the national debt ceiling, increasing the line of credit on our national credit card to 11.3 trillion. What do you think the interest is on 11.3 trillion? And no one is sure that this will work, it will avoid a major meltdown maybe this week, but a few months from now, Wall Street may be in some new crisis, begging for more money.
Henry Paulsen is pleading with Congress to get this relief bill passed quickly. Congress is not known for it's swift action, and already, since the Democrats basically have Paulsen by the short hairs, they are considering some additions to the bill. Which is right, and fair, I certainly don't want the CEOs who ran these multi-national companies into the ground getting a golden parachute while America struggles to pay the interest on 11.3 trillion dollars. Paulsen is insisting that there is no time to talk about the details, he is basically telling Congress to pay first and ask questions later. Is it robbery by the Republicans again? Is this crisis so severe that we should just pay up with no strings attached?
I have this feeling that Americans are getting hosed again, but I am also worried that Congress might screw around with this for too long, and the resulting meltdown might be blamed on the Democrats.
It's a lose-lose situation for America.
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No subject for immortal verse
That we who lived by honest dreams
Defend the bad against the worse."
-- Cecil Day-Lewis from Where Are The War Poets?
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