European Tribune - Comments - Some lessons from Bailout Week

Some lessons from Bailout Week | 41 comments (41 topical, 0 editorial, 0 hidden)

there is a point worth mentioning...or two..

First, most of the economists in important universities and academia are completely on our side... or at least not on the other side.. ten years ago there were no economists favoring fair trade, strong regualtion, and so on in big U.. now everybody agrees.. Krugman is not alone anymore..

Do not understimate the importance of being in Princeton, Berkeley, etc.. and have these center-left ideas... within five years economists will be like climatologists, people Republicans will have to fight against... and as you may notice the narrative to fight us is very very difficult to create even in the US.

The second thing to notice is that the media meta-narrative (as talkinpoints' boss calls it) has changed in our favour in the US..the cotnrol of the media by right-wing idiotic forces which go uncostested does not exist anymore...

In other words, the advance is clear... the US left should have started earlier to movilize but still..even most of the commentariat in the FT goes against their own editorials...

So,a green economic transition seems possible.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Sun Sep 28th, 2008 at 03:36:45 PM EST

I agree (4.00 / 4)

It's all the more frustrating to see the punditry in Europe still moving in the other direction.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Sun Sep 28th, 2008 at 04:32:27 PM EST
[ Parent ]

Re: I agree (none / 1)

The point about the bailout of course is that even when all of the money has been spent, it's still not going to solve the problem - and there will be much more pain to come.

There's the possibility of a tipping point very soon, and I think we're getting very close to pitchforks and torches in the US.

If the reality-based economists started putting out press releases, that would speed things along.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Sep 29th, 2008 at 04:48:25 AM EST
[ Parent ]

Re: I agree (4.00 / 2)

Note that

Goldman Sachs has admitted the Investment Bank business model is not viable;
it has accordingly announced plans to spend $50bn buying retail banks (small regional ones)
it is likely the bailout will buy GS's bad assets at at least a $50bn premium

On 3) it is clear that the solvent banks will be the ones to benefit from the bailout - even if they don't overprice their assets significantly (and, being solvent, they don't need to and in a "reverse auction" they won't). The funny thing about the bailout is that the insolvent banks would have to overprice their assets in the auction in hopes of being recapitalised and that reduces the likelihood of their assets actually being bought in the "reverse auction".

<sigh>

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Mon Sep 29th, 2008 at 05:14:48 AM EST
[ Parent ]

Re: I agree (none / 0)

Migeru:

Goldman Sachs has admitted the Investment Bank business model is not viable;

PN point, they've declared Investment banking as not viable for them, that is:

Not viable with their expectations of X% yearly profit growth (where X is a large number for their industry.)
Not viable now they've lost a huge heap of money from risky investments.

by Metatone (metatone [a|t] gmail (dot) com) on Mon Sep 29th, 2008 at 05:30:56 AM EST
[ Parent ]

Re: I agree (4.00 / 3)

PN taken.

I'm distinguishing "Investment Banking" of the Wall Street variety from the kind of "Commercial Banking" that Jerome does.

Properly, Jerome does Investment Banking and Wall Street did Speculation Banking but that's the nature of doublespeak.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Mon Sep 29th, 2008 at 05:33:22 AM EST
[ Parent ]

Re: I agree (none / 0)

This isn't a bailout - it's a round of civil war on Wall St.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Sep 29th, 2008 at 05:48:07 AM EST
[ Parent ]

Re: I agree (none / 1)

I said the other day that paradoxically the more traditional banking methods in the Eurozone will prevent Market Fundamentalism from being discarded at the policy level. Our governments including the EU Commission will press ahead with deregulation and liberalization.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Mon Sep 29th, 2008 at 05:18:38 AM EST
[ Parent ]

Re: I agree (none / 1)

This is the hole in the argument that needs filling. I haven't gone through it yet, but this is the case right-wing economists are making. If we cannot deconstruct this, we're going nowhere with the academic economics narrative:

http://www.heritage.org/Research/Labor/bg2040.cfm

by Metatone (metatone [a|t] gmail (dot) com) on Mon Sep 29th, 2008 at 05:39:41 AM EST
[ Parent ]

Re: I agree (none / 0)

Good find.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Mon Sep 29th, 2008 at 05:42:22 AM EST
[ Parent ]

Re: I agree (none / 0)

[sigh...]

Does 'Shut the fuck up you mendacious oily toads' count as a serious deconstruction?

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Sep 29th, 2008 at 05:50:53 AM EST
[ Parent ]

Re: I agree (4.00 / 2)

Well, it's my gut reaction... but I think we'll need something a bit more reasoned until we own the media...

by Metatone (metatone [a|t] gmail (dot) com) on Mon Sep 29th, 2008 at 07:07:26 AM EST
[ Parent ]

Re: I agree (4.00 / 3)

Paid holidays and benefits still lag significantly behind those of civilised countries, like Europe.
Saying that a dollar paid to health care is a dollar taken out of wages is nonsense - employers benefit from the having reliably healthy employees and are sometimes the direct cause of health problems. In a free market they should pay those costs directly.
The CPI is the most reliable indicator of disposable income. Disposable income drives the economy - without it, there's a credit bust. (And everyone knows the deflator index is massaged anyway.)

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Sep 29th, 2008 at 07:42:28 AM EST
[ Parent ]

Some lessons from Bailout Week | 41 comments (41 topical, 0 editorial, 0 hidden)

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