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Dow in the Tank-Pump in more $ fast

by NearlyNormal Wed Oct 15th, 2008 at 04:55:23 PM EST

What could we do with the money we are wasting by throwing it into the financial sector of the economy?  With these many billions, we could rebuild the rail system, we could retool Detroit, and the hundreds of towns that have manufacturing plants that feed Detroit.  We could end the necessity for taking out loans for going to college and just make it free, we could repair every damned bridge that needs it in the whole country.  Instead we are pouring into a rathole.  The executives of the financial firms don't plan on losing much.

From MSNBC business section

"Even though the banking sector may be returning to normal, the economy still isn't. The economy continues to face a host of other problems," said Doug Roberts, chief investment strategist at ChannelCapitalResearch.com. "We're in for a tough ride."

.  Well, we are in for something that goes beyond a "tough ride".  We are going to be losing our houses, our insurance, our savings, our retirements and we are going to be in hock up to our elbows-but the banking sector will be back to normal.

I think we really need to take a look a what has happened and not just recapitalize the capitalists on their terms.

In my opinion we have a structural problem here.  A fundamental problem that is not going to be fixed by just a "jolt to the system" as the guiders of the system seem to think we need.  The patient has cancer, and jolting him isn't going to cure that.  What we need is an operation.  We need to cut out the growth that has threatened to consume us, and that growth is fundamentally that of greed.  We must face the fact that there is a class of people amongst us who think that they deserve riches beyond the scale of imagination.  When we have faced that fact we have to decide whether they are right.  If they are, then we just continue on giving them the fruits of capital-the great increases of productivity over the decades since Reagan have gone into their hands rather than that of labor.  If we do not think they deserve that then we must face the requirement to take it away from them and to redistribute it.  I think there should be a very high tax rate on any money acquired whether by earnings, dividends, lottery, or finding it in a hole in the ground that is above say half a million bucks a year.  Further there should be a very high estate tax that is not deterred by foundations and the like-just because daddy was a billionaire doesn't mean that Sonny boy is going to be by birthright.  It sounds like class warfare, and it is.

The choices are stark.  We can unionize, work together and help each other and weather this awful time that approaches-or we can all have our little dreams of making it so big that we have riches like Midas, and coveting those dreams we will ensure the destruction of much of what we value in life.  We will commoditize ourselves, and we will find that singly we ain't worth too much.  I would prefer to not spend another dime past those already committed to bailing out the financial system, I would retool our industrial base, unionize it.  Train our workforce and get to work rebuilding this country-and building it right this time.

Oh, and its probably the end of the empire too, those things are expensive.  


Crossposted at dkos to die a quick death.  No great loss, just kind of pissed me off watching this idiocy.

"I said, 'Wait a minute, Chester, You know I'm a peaceful man...'" Robbie Robertson
by NearlyNormal on Wed Oct 15th, 2008 at 04:59:32 PM EST
great diary, you speak for me entirely...

European Tribune - Dow in the Tank-Pump in more $ fast

 The patient has cancer, and jolting him isn't going to cure that.

funny that, i was just musing today how these bailouts are like shooting a dying man full of cocaine. there are a few spasms resembling genuine life force, but the end result is the same, possibly even hastened by the intervention.

these clowns have no principles other that 'more of everything, for me and mine, now and forever amen', they remind me of chickenhawks, talking like macho men behind desks while real men go to die at their behest and to their profit, these adders strike at the heart of all that's purportedly decent and 'fair play' about trust in institutions, by debasing that trust, along with the quality of life for millions who never voted them into having so much power.
if this is democracy, no wonder it has to be forced on so many unwilling victims ('cursed' with envied resources) at gunpoint.

and then they want to be paid to slink off into the shadows or lurk in economic terror shock doctrine think-wanks till the economy has waxed fat again, and people relax their guard.

maybe that's why we've arranged it so this next crash will leave permanent lessons, not the merely evanescent memories of '29 that remain in their distant sepia tones.

nice to see you diarying, NN. a good rant is hard to find.


'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Wed Oct 15th, 2008 at 05:44:35 PM EST
[ Parent ]
Thanks, melo,  I got out of the market a couple of years ago other than a cursory bit each week, but the whole system needs to be examined and we need to talk in detail about whether we want to keep on with the reagan bullshit or go a different, better way.

"I said, 'Wait a minute, Chester, You know I'm a peaceful man...'" Robbie Robertson
by NearlyNormal on Wed Oct 15th, 2008 at 05:54:32 PM EST
[ Parent ]
I cashed out of the market before the '06 election and I agree with your analysis.  The bailout is appalling, not for its stated intent of unfreezing credit markets but for its total disconnect between the actions undertaken and any certainty of obtaining the desired effect. Sec. Paulson has already spent enough money to accomplish the stated objective, but done it in such a way as to prevent it from being much more than a gift to his cronies.

$250 billion injected into banks with toxic balance sheets does not restore confidence in or the willingness of those institutions to lend.  Too many knowledgeable people still fear what might be on their books.  If your water supply has been poisoned, diluting that supply with a known pure additional few percent of water is useless.  The only possible solution for that existing supply would be to filter out the poison.

That takes time and a solution is urgently needed.  I have suggested standing up new, untainted banks with about that amount of capital.  They could make loans and provide credit.  Bruce McF has suggested turning conservatively run credit unions into full service banks with commercial lending capabilities.  It would also be possible to beef up upgraded credit unions or to inject capital into some of the many local and regional banks that have been well and conservatively run.  A thorough inspection of balance sheets and draconian penalties for misrepresentation would be required.  

The Federal Reserve and FDIC could also just purchase the commercial banking divisions of contaminated banks for fair value and merge them into healthy banks, along with new capital in return for senior preferred stock.  If they can force partial nationalization on the big boys, they could do that as easily.  It is shameful that they haven't moved in this direction.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Oct 16th, 2008 at 12:45:14 AM EST
[ Parent ]

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