Stocks down 400

[AmpedNow]

Oh, geez. Now we're all commies for demanding accountability from the fat cats who took advantage of the free market knowing the potential mess they could create for everybody.

Ironically, these same dereg/free market weasels were quick to turn the largest capitalist economy in history into just another also-ran pit of socialism in just one day. Think about that one... The "free market" has forever been changed.


Other things that have become apparent rather recently:

Bush and his entire legacy is toast. Any president that has to preside over a potentially total economic collapse during his eighth year in office will be considered a failure. "Clinton-reaching" at this point is futile at best. He's had 8 years to correct any market imbalances that led to this, but instead, did nothing and allowed the free market to "correct" them. It obviously had the opposite effect. But since him and his buddies are now in trouble, that's all changed. Only problem is it's too late now.

Our credibility in the world, both financially and geopolitically, is completely shot.

The free market system is under attack. Not by the commies and Marxists, mind you, but by the very fat cats who heavily promoted deregulation all these years at the expense of everyone else, who now find themselves holding the shit end of the stick. The problem is, we're all teetering from being neck deep in shit thanks to them... But hey, whatever economic system they can presently make the most money in is what they're all for.

A totally deregulated free market is almost the inverse of communism in its potential of harming millions of innocent people.

Otoh, think about Hong Kong. Under red commie rule since 1997. Yet still using free market elements, and doing quite well.

Considering our presidential choices next month, it looks to me like we're really in trouble regardless of who gets in. This economic mess is well beyond their reach of either of them to do anything substantive about it anytime soon. And they're both buffoons when it comes to economics. Lucky us.


As a side note, I'm not a Marxist. But I do find his quotes interesting these days... Here's a couple more:

Democracy is the road to socialism.

The rich will do anything for the poor but get off their backs.

The production of too many useful things results in too many useless people.

...and my personal favorite:

The last capitalist we hang shall be the one who sold us the rope.

[cgarison]

Allright, Philly, what's the latest on the total economic & social collapse? I want to know what the velocity is when we hit bottom.

That all depends. Right now things are slowing to be a long trough with a bottom somewhere in March next year and picking up and moving out of the recessionary zone in early 2010. This process is going to take over a year to happen because all the Fortune 1000 companies that I have contacts are all cutting discretionary spending, making corporate structures more vertical by elliminating big dollar sallaries (VP & above), and reducing capex on most capital spending and putting all contruction projects in 2009 on hold.

The flip side/good news of this is that once we get through the very bleek, bah humbug holiday spending season, sells of all types in January and February will suck bad. But by March 1st, income tax refund checks will be getting into the palms of Americans wanting to put $2.40/gallon gasoline in the tank of their full size crew cab pickups and purchase new spring clothes and electronic gadgets like digital cameras and iPhones. This lubrication will spur on enough economic activity to goose the economy back to life.

So what is the wildcard???? Oil. We have to keep the OPEC assholes in check. Perhaps Obama will launch a missile up the ass of Chavez would show all those sheiks that we are not afraid to demonstrate that we are the Devil just like Hugo proclaimed at the UN.

So if oil stays down, this mess will sort itself out. By Christmas 2009, stores should be buzzing with customers spending some green. So by the end of January 2010, capex and construction spending will once again start moving and big trucks will fill the highways moving the materials of commerce.

So, this means the bottom will be in the winter/early spring 2009 and things will be looking better in mid spring 2010.

Thus is the view from Jeepy's crystal ball. I am glad I brought it to Philly in 2004.

[cgarison]

I add to my wonder why nobody's shot any oil execs to wondering why nobody's shot any Wall Street execs.

Easy -- they have done nothing wrong, and non-Communist Americans know that.

Whoa!

I still say the left should be kissing the...feet....of the oil companies' employees. Keen observers saw the populist theme for this political year get started at the end of '06, and, of course, populism requires some sort of villain to gin up hate against....something to use to rouse the rabble...or community-organize....pick your term. This time, it was oil that could be turned into a target that both the rabble and the elite could both be turned against. Most here will remember the apparent quid pro quo connection between Senator Charles Schumer and the NYMEX oil traders I cited....now, recently, CNBC reported that the money used to fuel all those upward trades was supplied by the managers of the labor, teachers, and gubmint workers retirement funds. And the oil companies, who already lose well over half their revenue to taxes, are made the bad guys?? Please! If somebody's to be shot, it needs to be all of those involved in this use of the people's money against them for the sake of ushering in Communism...er, I'm sorry...I believe the assigned euphemism for this cycle is "fairness."

Ouch. Really Ouch!

I don't go so far for finance types, but they have not done anything wrong and would have been under attack if they hadn't been doing their jobs. Ironically, the very first to have been on the attack would have been those union fund managers.....

Well you had better get your hands on a cyanide pill and get ready to bite down because unions are going to be getting strong over the next 4-8 years.

And as far as the finance types that you bash in this post, I am trying to figure out if you are bashing the powerless analyst, the accountant/controller with their hands tied with SEC regulations and SOX requirements, or the fat cat corporate executives that sucked the money out of our corporations and jumped ship just prior to scuttling their corporate ships. You keep forgetting that 95% of finance types are totally powerless yet you point fingers for jobs lost or executives stealing money for golden parachutes.

[Lester]

First off, thinking this is actually the President's fault kinda shows that you might not know what a President does. I do agree though... you don't recover a black mark like this easily. It was decades before Herbert Hoover's reputation began to "repair".

Secondly, Arp, sorry bud... but throwing around words like "communism" when "the state" had to dig "the capitalists" out of a mess they should have seen coming, does not bode well for your argument.

[AmpedNow]

First off, thinking this is actually the President's fault kinda shows that you might not know what a President does. I do agree though... you don't recover a black mark like this easily. It was decades before Herbert Hoover's reputation began to "repair".

That was my point. The president does not have direct control over the economy. Nor is this mess all his fault, although I'm sure that in eight years, he had to at least be aware of some of these warnings. Some were sounding the alarms as early as 2002 that this was going to eventually happen if nothing changed.

Regardless, having this crisis pop up in the last months of his eight year presidency will cement his legacy as a failure. It will even overshadow his 9/11 legacy, for which he deserves some credit for.

As for economics, it's interesting that McCain of all people proposed even more socialism tonight... $300 billion more on top of everything else. Amazing.

We are witnessing an unprecedented chapter in American history before our eyes.

[Bob Campbell]

Can't you almost hear ARp goose stepping down the lane while humming Duetchland Uber Alles?
I blame all those goddamn poor people for this whole thing. If they'd get jobs and pay their bills they'd stop making life so hard on those tireless patriots on Wall St. working tirelessly to make America a better place.

[Jet Black]

If poor people hadn't been trying to buy a house with no job and no assets, and were not stupid enough to get an ARM loan with zero down; and if the government hadn't demanded the availability of such in the name of "improving" things for the poor, we would not be in this mess. I pay my bills. I only borrow when absolutely neccessary, which act I approach with fear and dread, as my folks brought me up to do. I pay my bills. I guess I'm the really stupid one. The GB43 is not to blame for this mess, but he's to blame for believing Paulsen on this bailout plan and he's to blame for failing to scream bloody murder about Fannie/Freddie instead of what he did, which was merely raise concerns on a routine basis.

Barney Frank is the man who's head I want to see on a rhetorical pike.

[Lester]

Exactly... all in the name of "affordable housing" for folks that won't make timely car payments.

Honestly, I came into home ownership during the peak of the housing bubble. What I could borrow and what I should borrow were two distinctly different numbers. But a Senior Airman in my reserve unit was approved for 300k (with the reserves being his only job), and used up every dime of it. He made exactly 2 house payments before falling behind (a big Christmas was more important), and within a year no longer owned a home.

Technically Arp is correct, everything these clowns did was legal... which lays it at the feet of our politicians.

[Bob Campbell]

You are so right. That damn Barney Frank. In the dozen years of Republican control of both houses of Congress, that damn Frank didn't do a thing to prevent this mess. W is entirely blameless. He's been much too busy with the important work of the nation....whatever the hell he thinks that may be.

[Hoosier Daddy]

You are so right. That damn Barney Frank. In the dozen years of Republican control of both houses of Congress, that damn Frank didn't do a thing to prevent this mess. W is entirely blameless. He's been much too busy with the important work of the nation....whatever the hell he thinks that may be.

[Lester]

You are so right. That damn Barney Frank.

I like the video of Franks and O'Reilly where he accepts ZERO responsibility for this happening.

ZERO.

He's head of the House Financial Services Committee... but he had NOTHING TO DO WITH IT!!!!!!!

So back atcha.

[Dr. Whiplash]

He's head of the House Financial Services Committee... but he had NOTHING TO DO WITH IT!!!!!!!

Only since January 2007. For the previous 12 years, it was those other guys.

[genlock]

And when the bill was passed, it was Frank.
Sounded good tho. Housing ownership for everyone.
Tempest tossed, wretched refuse types.
How Utopian.
Does, not sound much like a Republican venture, does it?

[Bob Campbell]

If you're talking about the President's bailout bill, yes. If the CRA, no.

But hey, poor minorities are the cause of most of our troubles aren't they?

[genlock]

The Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.) is a United States federal law designed to encourage commercial banks and savings associations to meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods.[1][2][3] The Act was intended to reduce discriminatory credit practices against such neighborhoods, a practice known as 'redlining'.[4] The Act requires the appropriate federal financial supervisory agencies to encourage regulated financial institutions to meet the credit needs of the local communities in which they are chartered, consistent with safe and sound operation. (See full text of Act and current regulations.[5]) To enforce the statute, federal regulatory agencies examine banking institutions for CRA compliance, and take this information into consideration when approving applications for banking mergers, acquisitions or branching.[6]

[Jet Black]

I guess I must have been fooled by those CGI clips made up by Faux News, showing Frank in committee arguing against any reining in of FM & FM, saying that there was no problem, nothing to make any legislation over. I guess Faux News was tricking me also when they made up those lies about Frank's homosexual relationship with a Fannie Mae official; about Clinton's putting one of his political cronies over Fannie Mae who immediately changed the bonus rules for himself and the board, tieing bonuses to volume of loans insured instead of profit ratio of policies that didn't pay out to bad ones; about the Bush administration calling every single year of the administration for tighter controls on FM & FM; about the bill McCain signed onto to rein in the two, which was defeated by Democrats; about Democrat Dodd's freebies from Countryside, about Obama & Dodd being the higher recepients of FM & FM campaign money (no lobbiests there, huh?) Yeah, I guess it's all a scam, becasue every time a Democrat is on tv they mention, robot-like, that this prolem is becasue of REPUBLICAN DEREGULATION. If Frank can't have any sway in 22 months as Chairman of the Financial Committee in a Democrat-controlled house, what good is he? He's a lying, greedy, mentally-and morally-crippled pygmy of socialism writ large.

[genlock]

I will admit that there is plenty of blame to go around.
Bush and reps get the blame for inaction.
Pelosi, Frank and company get the blame for activating the mess.
I am not voting for Bush this time around.

[Lester]

Agreed. Sorry gang, be it red or blue, in some manner every single one of our elected officials failed us on this.

[Jet Black]

Agreed. The question of commission or omition is moot. Anybody involved, throw 'em out.

I'm also way, way non-plussed with McCain's suprise 300b mortgage adjustment bailout plan from last night's debate. Our only two choices in this election now appear to be a leftist disguised as a left-moderate and a center-moderate disguised as a right-moderate. Whatever happened to real Conservatives? We need one now. God, but I miss Reagan.

[Bob Campbell]

Or none of the elected officials let us down. Maybe they were just letting the free market work.
Then again, the majority of the problem came from corporations not regulated by cra. Lehman, not subject to CRA. Every mortgage company in America, not subject to CRA. CRA only covers banks that accept deposits. So the big Sub-prime lenders, Countrywide and others, not covered by CRA. None of the trading of mortgages and derivatives covered by CRA. In fact, none of the trading regulated at all.

Cra covered bad loans make up a minority (catch the pun) of the bad loans.