My fellow Americans, my friends, my fellow citizens... just remember who has given us this wonderful recession, George Bush and his Republican cronies... don't forget this come election time

That's freaky weird. Apparently there are two columnists named Walter Williams. The one quoted above is an anti-Reaganite at the University of Washington. The one I'm familiar with is an ultra-Reaganite at George Mason University.

One of them - I think the one who's not an insane socialist - has taken to going by the name Walter Jon Williams.

Dave

I note that Realist missed the South Sea Bubble back in what, 1832? Oh and he missed the Florida Land Bust of 1925 and the Panic of '93 too.

For once I think he has a point with his ravings, but he probably doesn't see it.

What his litany of past banking crises illustrates is that these things happen all the time, they end up not really being the end of the world they are predicted to be and we recover and move on.

Dave

Got it:

Walter Williams, left-wing political science author
Walter E. Williams, right-wing economics author and columnist
Walter Jon Williams, science fiction writer

Unrealist...you left off the fact that since the Keating Scandal the stock market has risen dramatically. The average bank and housing related stock (which were hit the hardest) have grown by over %300 percent.

"With all yer fancy book learnin and writin" do you understand that is the way capitilism and economic cycles work?


JOM "HINT - Buy low sell high!"

"Any great nation that goes off the gold standard ends being a great nation." --- Ronald Regean


We have messed with interest rates and run up deficets for too long. Spending trillions on the defense budget, creating a federal school regulatory system, and expanding the bureaucracy have put this country on the brink of economic collapse.

Ron Paul tried to speak the truth but no one wanted to listen. It's really too bad.

Interesting article. I would like to offer the following comments:

JP Morgan and Chatham House formally known as the Royal Institute of International affairs formed and started the Council on Foreign relations. Link. They also are part owners of the FED through Chase. Link

You the reader can draw your own conclusions as to what is going on today in this country. My own personal belief is that both the FED and the CFR want to destroy the middle class in this country, which has more than anything let to the recent real estate bubble burst. A society of owners and serfs. Welcome to der new vorld Order.

Dave, Clav, Alessandro, Maurice,

Where are you???

I would think that the rabid, proponents (loyal) of Capitalism would be up in arms with the bailout of Bear Stearns. I thought Capitalism says let the chips fall where they may.

"Walter Williams, left-wing political science author
Walter E. Williams, right-wing economics author and columnist
Walter Jon Williams, science fiction writer"

And don't forget...Walter "No-neck" Williams, rightfielder for the Chicago White Sox, late 1960s.

Zedd,

I too have notice that these guys are strangely quiet regarding this issue. Assuming for the moment that some of these guys are homeowners, their relative value of their homes more than likely has decreased perhaps well over a hundred grand in worth, you would think that they might be a bit more peeved and offer up their assesment of the situation. Enjoy your devaluation fellas, I am assure you that some of these guys at the CFR, and the FED are. SMIRK

#10:

Don't forget Walter Wall, carpet layer extraordinaire.

:-p

All these guys who are now whining that we MUST bailout Bear Stearns for financial stability and market confidence, were happy to let a million homeowners lose their homes last year. Partial?

Dave, Clav, Alessandro, Maurice,

Where are you???

Dave showed up in comments #3 and #4. Most of the other capitalists are out making money - that is rapidly becoming devalued.

I know that in anything I do, I demand prices in denominated in shekels - the dollar as plummeted in value in the last two years.

This article from Ynetnews (the English on-line site of the daily, Yediot Ahronot) confirms much of what I have reported to you about the decline of Israeli society, which has aped America, thinking it was indeed a success story. As we now see, the free market is not free, for it socializes tis losses (that is pushes them onto the taxpayer to deal with) and privatizes gain (effectively denying society at large the benefit of immense amounts of money pocketed by CEOs. In addition, the capitalist economy of America de-links executive performance from income. Fantastic failures waltz home to huge golden parachutes while the rest of society gets the golden middle finger of lectures on "pulling oneself by the bootstraps".

From Dan Caspi's Yediot Ahronot article:

The global financial crisis requires an Israeli process of self-examination. In recent years, we have seen an incisive debate take place around here between two different economic worldviews - a planned economy and a free market. For the time being, the latter has the upper hand.

The neo-liberal approach blossomed along with the political revolution that took place three decades ago when Likud came to power for the first time. What we saw was accelerated and uncontrolled Americanization of the Israeli society: whatever we see in America is good for us too! The Israeli followers of this worldview have been relaying on the American model of a free market - although at this time we can refer to it as "seemingly free."

In the name of obsessive adoration of market forces, Israel's economic leaders accelerated the privatization of public assets and vital services - welfare, health, education, etc. However, the gravest financial crisis since World War II, as former Fed Chairman Alan Greenspan characterized it, has in fact shattered the "American dream" of many Israelis.

To a large extent, the selective coverage of success stories and successful figures and almost complete disregard to the losers and failures allowed for almost ideal dreaming conditions. Journalists and editors were intoxicated by grandiose parties thrown by newly wealthy Israelis who realized the American dream. They have been glorified and characterized as the Israeli economy's engine. Meanwhile, those who attempted to point to the maladies associated with the free market, and particularly the high social cost expected to be paid by Israeli society, have been condemned and expelled from the confines of the consensus and public discourse.

Oh yes, just in case anybody is interested, the shekel has risen to NIS 3.3785 to the dollar or 29.6 cents per shekel. In short, NIS 1,000 now equals $296 instead of the $212 it equaled in March, 2006.

It sounds like the US government was happy to stand aside while unscrupulous loan salesmen sold unfavorable loans to homebuyers. The salesmen and execs got unusually large commissions and bonuses for these loans based upon the face values of the loans (you know, 'points').

Then the US government was happy to stand aside while homeowners found they couldn't make the escalating payments and went into forfeiture. Bush was content to wag a scolding finger at homeowners for making risky 'speculative' investments.

But when large companies like Bear Stearns faced problems the government leaped into action to save them, using taxpayer money as necessary, and putting the Fed at risk for financial transactions that never paid financial insurance premiums and were never subject to regulation.

First they hit citizens low with bad loans, then they hit 'em high by using tax money to bail out the big guys. The old one-two.

Does this look like a systematic scheme by a Governemnt Financial Industrial Complex to defraud US citizens?

"Does this look like a systematic scheme by a Governemnt Financial Industrial Complex to defraud US citizens?"

No.

The Federal Government is incapable of doing anything systematically.

As for the Bear Stearns "rescue," The Economist had this to say about it:

"Rescuing Bear Stearns and its kind from their own folly may strike many people as overly charitable. For years Wall Street minted billions without showing much compassion. Yet the Fed put $30 billion of public money at risk for the best reason of all: the public interest. Bear is a counterparty to some $10 trillion of over-the-counter swaps. With the broker's collapse, the fear that these and other contracts would no longer be honoured would have infected the world's derivatives markets. Imagine those doubts raging in all the securities Bear traded and from there spreading across the financial system; then imagine what would happen to the economy in the financial nuclear winter that would follow. Bear Stearns may not have been too big to fail, but it was too entangled."

I suppose you would rather see Bear Stearns go under, taking a substantial portion of the credit market (and ALL those mortgages, bad AND good) with it?

Just in case anybody is interested, the shekel has fallen to NIS 3.553 to the dollar or 28.13 cents per shekel. In short, NIS 1,000 now equals $281.30 instead of the $212 it equaled in March, 2006, down $15 from the value it had on 19 March, 2008.

Someone (or a group) is buying up dollars and selling shekels - possibly raking in the profits from short selling the dollar.

That's how things are done in relatively small economies like ours where a few families hold most of the wealth - a felafel reepublic....

This still does not solve the fundamental problem of the dollar and the American economy. The American government is stuck pouring all of its money down the sewers of the Tigris and Euphrates, and this puts painful pressure on a weak economy.

Dave showed up in comments #3 and #4. Most of the other capitalists are out making money - that is rapidly becoming devalued.

I'm overseeing the massive remodeling of our master bathroom while the dollar is still low so I can get it on the cheap. Solid gold fixtures (probably the next crazy thing my wife asks for) don't come cheap.

Dave

It looks like Bear Stearns successfully held the US economy hostage to extract billions in tribute from the US government and it's citizens.

"I suppose you would rather see Bear Stearns go under, taking a substantial portion of the credit market (and ALL those mortgages, bad AND good) with it?"

Wouldn't it be prudent for government to take steps to avoid being heldpup by highwaymen like that? Wouldn't it make sense to limit the power of such private unregulated financial institutions?

Wouldn't it make sense to breakup pig-sized financial institutions under the anti-monopoly laws?

And yet, the Clavos and Nalles of the world will step forward to loudly protest any regulation, crying "Free Markets!" where there can be no free market when one dictates market choices to another.

Looks like Dave is telling another madeup fable:

"I'm overseeing the massive remodeling of our master bathroom while the dollar is still low so I can get it on the cheap. "

Oh, that would mean switching from expensive Foreign fixtures to the newly inexpensive american products. Let me see, a Chinese bathroom mixer water tap (Yiucco) cost about $30 2 years ago, while a similar American tap (Kohler) cost about $90. Is Dave saying that the American Kohler tap is less than $30 now? A 70% drop? How does that figure?

A chinese toilet cost $80 while an American toilet cost $300 2 years ago. Has Dave found a place to get a Kohler toilet for less than $80 so he can save money over the (now) more expensive Chinese toilet?

Same thing for granite and marble countertops.

Dave must be making this up.

Apparently, Dave has no shame about the stories he'll tell to make his unsupportable claims.

"Dave must be making this up."

Or, his tongue was firmly planted in his cheek.

Duh.

Sheesh...