Archive for September, 2008

Subprime Judgement: The Financial Crisis and Bailout Plan

Sunday, September 21st, 2008

My paranoid thought for the day concerns the timing of this crisis, and the motives of the various players. We assume altruistic, if unwise, motives for the political agents, but before Paulson was an altruist, he was (and still is, financially?) a self-interested investment banker. One wonders if the human heart (and pocketbook) can change its allegiances so easily.

Regarding the timing of this crisis, perhaps we can consider this the ultimate political hedge. Banks must know they are better off with a pro-business (”pro-free-market” is a false sobriquet with which we can finally dispense) Republican making the bailout than a pro-consumer Democrat.

Is this conspiracy theory a paranoid fantasy?  It’s not like all the major financial players are holding private meetings, hidden away from the public, over the weekend…

Oh wait, yes they are…

Congressmembers should not be meeting with Paulson and Bernanke. The GAO should be getting unfettered access to the books of any bank that is looking for a handout. This is a strict question of numbers.

Let’s just hope Obama has the guts to stand up to this nonsense.

There are plenty more notions in this line of thought, but one is hesitant to cry ill motives alone, without further proof. Then again, given the banks’ history of hypocritical, deceptive and self-serving incompetence, perhaps the proof is plain to see. If McCain thinks that Cox should be fired, shouldn’t also every other management team on Wall Street be fired as well, before another penny of taxpayer money is given to them?