Tag: 1929 Redux

Piss and Vinegar and Out of My Mind for 7 April 2009

Incredible video! Watch the impossible!

Genius. Pure genius. And I know I’m right.

Observation: The tone of the Wall Street Journal has changed for the, well, rightwing tabloid, since Rupert took over. Today, snippy because Washington is grabbing a little control of the economy? Gee, how awful. These guys should be free to simply complete its destruction, huh?

They’re all scum, a bunch of unprincipled whores.

Some people are just plain, completely crazy and what sets them off is no reflection on what sets them off.

Look! A fossil keyboard!

Hoobama’s favorite quote from Buddha?

Let us rise up and be thankful, for if we didn’t learn a lot today, at least we learned a little, and if we didn’t learn a little, at least we didn’t get sick, and if we got sick, at least we didn’t die; so, let us all be thankful. – Buddha

Timmy’s plan may even be worse than we fear. Short version. Long version.
Me, I think the trashing of the mark-to-market rule is a set-up, a way to deem banks as passing the lamest stress test, so no one has to fear getting shut down because of, well, terminal insolvency and they can keep getting taxpayer bailout bucks.
When a “liberal” Dem (actually, slick-talking opportunist, but I digress) is so aggressive at doing Big Finance’s bidding, you know they’re all corrupt, regardless of affiliation.
And here’s the Road to Nowhere. There’s a big whipping with a limp noodle a’coming….

Cracker asshole. (Remember even though it got scrubbed in the redesign: this blog is all about the viscera, regardless of all the sweetness and light 🙂 )
And here’s an anal-ysis of the pathology of being asshole. But who cares? They just all die. Now.

Today’s attack on knowledge. Lesson: Knowledge must be flawlessly perfect, although deranged belief is better.

Watch Levi rat on that little dumb slut, Bristol (said it that way just for the hits).

Breakthrough: Obesity starts at four!

It takes medical professionals to enable and abet torture.
Shortish version.
The full story.
More.
(Hoobama has no real problem with this.)

The Honeymoon is Over; Obama’s Great Failure; Neither Lincoln nor FDR, but a Worse Hoover

o-hope-ends1Have a smoke, Barack; maybe it’ll keep you out of trouble. Enjoy spending the next four years BSing the American people so they can forget your great failure by 2012. Imagine: Allowing a necessary stimulus bill controlled by those who enabled, if not created, the current crisis.

No great problem; I have enough faith in the free market to be certain it will right things in 25 or 50 years.

Message to the president: Nothing you can do except getting a proper, timely bill passed can make up for this. Nothing. What’s your plan? Faith that the GOP will have no one to run against you in 2012? You think it’ll be 1996 again? And I guess the rest of us can just, you know, drop dead?

Professor Krugman is only slightly less hopeless and doesn’t seem at all bitter:

I’m still working on the numbers, but I’ve gotten a fair number of requests for comment on the Senate version of the stimulus.

The short answer: to appease the centrists, a plan that was already too small and too focused on ineffective tax cuts has been made significantly smaller, and even more focused on tax cuts.

According to the CBO’s estimates, we’re facing an output shortfall of almost 14% of GDP over the next two years, or around $2 trillion. Others, such as Goldman Sachs, are even more pessimistic. So the original $800 billion plan was too small, especially because a substantial share consisted of tax cuts that probably would have added little to demand. The plan should have been at least 50% larger.

Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

My first cut says that the changes to the Senate bill will ensure that we have at least 600,000 fewer Americans employed over the next two years.

The real question now is whether Obama will be able to come back for more once it’s clear that the plan is way inadequate. My guess is no. This is really, really bad.

The GOP Hates America and Wants You to Just, You Know, Drop Dead

Professor Krugman notes:

 

Thirty-six out of 41 Republican Senators voted for the proposed DeMint amendment to the stimulus bill — a massive package of permanent tax cuts that would create a huge hole in the budget, while doing very little to help the economy.

There isn’t much room for bipartisanship when 87.8% of the other party is totally irresponsible.

The professor Nobel laureate also notes:

 

2001: Republican Dick Armey throws a fit over Congressional Republicans being compared to the Taliban.

2009: Republican Pete Sessions proudly compares Congressional Republicans to the Taliban.

These are sick, sick people who are, well (and contrary to Big Media’s obsession), unfit to participate in the public debate because they have absolutely nothing but demented positions to offer. Their track record is clear.

Speaking of a clear record of failure, the professor furnishes this:

FDR For Dummies

The big rap against FDR’s handling of the Depression is, well, he pretty much did nothing, actually, that it was WWII (and the post-war economic landscape) that did the trick and then brought a generation or two of prosperity.

Actually, he was doing fine til he listened to the pre-Keynesian conservatives and pretty much undid all he had accomplished:

There is a deep disagreement between the Democrats and the Republicans about what governments can and should do now. To understand this, we need to look at a seemingly esoteric debate between the parties about what happened in the last global depression. There are two contradictory stories about how the Great Depression ended. They provide dramatically different road maps for 2009 – so it’s essential to figure out which is right. The winning side will determine your chances of losing your job and your home.

The dominant story in the public mind is of President Franklin Delano Roosevelt’s success. It goes like this. Like Obama, FDR comes to power with the American economy haemorrhaging jobs. He believed that, if private industry is withering, the government has to take up the slack by large public spending programmes. He set millions to work preserving green spaces and rebuilding the country’s infrastructure. He thought it was necessary to borrow and spend in the short term to prevent complete and more costly collapse later. Use government to counter the economic cycle, rather than leaving us all to drift out to sea on it.

This is Barack Obama’s story too, as they launch their own fiscal stimuli. His favoured analogy is of jump-starting a failing car, rather than let it whimper to a halt on the road.

But at the height of Reaganism, a small number of right-wing economists began to tell a different story about that time. They argued that the American people had been wrong: the New Deal actually made the Depression worse. By borrowing and spending so much, the government created a climate of uncertainty. This made investors hold on to their money – prolonging the despair. It didn’t restore private investment, it “crowded it out”. So in a depression, all government can do is cut back its own spending and wait for the business cycle to recover. The only effective way for government to hurry this along is a monetary stimulus: altering interest rates and the quantity of money in the economy in an attempt to increase demand.

This is increasingly the Republican view, promoted hard by conservative commentators like George Will. At the core of this case is a stark fact: unemployment was still at 13 per cent in 1937.

Which is true? The reality of FDR’s rule is more complex than either story admits – but the lessons vindicate one set of principles resoundingly.

It’s almost forgotten now, but FDR ran for election promising a balanced budget and big spending cuts. By the time he assumed the Presidency, however, public protests against the economic collapse were so huge that he was forced to change course and launch his public spending push. The result? Unemployment began to slide down from its 25 per cent peak.

But then, in 1936, FDR wobbled. He listened to the people making the fiscally conservative case and slashed spending. Unemployment rose again – producing the spike in unemployment that people like Osborne now perversely cite as evidence that the New Deal didn’t work. But the reality stands. When FDR spent, unemployment fell. When FDR cut back, unemployment rose.

Yet perhaps the clincher is the answer to a bigger question: how did the Great Depression end? It didn’t stop with the conservative suggestion: slashed spending, slashed debt and slashed government activity. It ended with precisely the opposite: the vast fiscal stimulus of the Second World War. The government sent debt soaring to its highest levels in US history (until today) in order to spend more than ever before. It set up the longest boom in US history.

This is our choice now. Obama will have to be pressured hard to make their stimuli much bigger, and to focus less on propping up old corporations and more on building a new low-carbon economy. He will make many mistakes. But, as FDR put it, “Better the occasional faults of a government that lives in a spirit of charity than the constant omission of a government frozen in the ice of its own indifference”.

Link.

Something to Piss One Off

Gotta say, how pervasive is this mass sickness or pathology that brought us here….

Via TPM:

You really should take a look at disclosure this morning regarding the payment by Merrill Lynch of $3-4 billion in bonuses in late December, just ahead of the closing of the acquisition by Bank of America.John Thain, former head of Merrill and now formerly with BofA (fired today), paid the bonuses earlier than they are normally paid (late January, February) because he knew that once the BofA deal closed, he would be unable to “reward” all those hardworking Merrill bankers and traders who lost a mere $27 billion in 2008 ($15 billion in just the fourth quarter), and whose company needed an injection of another $10 billion of government capital and $118 billion of government backstops in order to convince BofA to follow through with the 12/31/08 acquisition. Without that capital and backstop, no BofA deal, and certain bankruptcy for Merrill and its fine crew of bankers and traders.

I worked on Wall Street for 15 years, and was laid off late last year. I can tell you this for sure: you don’t need to pay a dime in bonus to anyone on Wall Street these days. I know this firsthand: there’s nowhere to go!

Where would a Merrill banker unhappy with a donut for a bonus go? Lehman? Bear? Bank of America? There are no jobs on Wall Street, there are no jobs on Main Street (and certainly none that will even pay close to what these guys earn just in salary; my salary alone put me in the 99+ percentile in income).

These guys aren’t going to leave Merrill because of no bonus to become CEOs, law firm partners, or MLB shortstops. They’ll do what every single person I know on Wall Street that still has a job: they’ll keep their heads down and hope the next round of layoffs doesn’t include them.

One last thing: this is, I think, would be a perfect situation for Obama to discuss specifically. Merrill bankers and traders making off with $3-4 billion days before taxpayers are “required” to put up another $128 billion in capital and backstops, thanks to the fine work of those bankers and traders? Come on…enough is enough.

Krugman’s Worry; It Scares Me, Too

Nobel Laureate Professor K.:

Mark Thoma:

I think the stimulus package is like driving up an icy hill. If you don’t have enough momentum from the start and fail to provide enough “stimulus” to get the car over the crest of the hill, you can slide all the way back to the bottom, crashing into things along the way and ending up worse off than when you started. Maybe you can give it more gas along the way if needed without spinning out, and perhaps you can hold your position if you don’t make it to the top, and then start again from the higher level, but that’s not a chance I want to take when I’m sitting at the bottom wondering if I can make it to the top without wrecking my car — the possibility of falling all the way back to the bottom and ending up worse off would make me want to start with sufficient momentum and then some. Essentially, I am arguing that there are crucial economic and psychological “tipping points” that must be reached in order for the economic recovery package to be effective (or at least, there’s enough of a chance that they exist that they cannot be ignored when formulating robust policy).

I’d add that there may also be a political tipping point: if the stimulus package is too weak, conservatives will pile on after it fails to deliver, claiming that the whole concept has been discredited.

All I’d add is that maybe the O Team is already playing Slick Willie’s triangulation game but in a more productive way. You can call this version “Rope-a-Dope”. (I’d suggest his appointments show an inclination to triangulation.)

In this case, weaken the Republicans by coming up with a relative modest plan that they have trouble objecting too (with gratuitous taxcuts!) The Dems in Congress then will either expand the bill, but not to an extent that O will feel the necessity to veto, and/or the neutered-for-Republicans plan will fail enough soon enough for a re-do, hopefully before too much harm’s done. (Me, I’m already unemployed.)

Time will tell….

Our Leaders to All Americans: Drop Dead!

A business’ lies about its solidity is a trade secret? Really??

The Federal Reserve refused a request by Bloomberg News to disclose the recipients of more than $2 trillion of emergency loans from U.S. taxpayers and the assets the central bank is accepting as collateral.

Bloomberg filed suit Nov. 7 under the U.S. Freedom of Information Act requesting details about the terms of 11 Fed lending programs, most created during the deepest financial crisis since the Great Depression.

The Fed responded Dec. 8, saying it’s allowed to withhold internal memos as well as information about trade secrets and commercial information. The institution confirmed that a records search found 231 pages of documents pertaining to some of the requests.

“If they told us what they held, we would know the potential losses that the government may take and that’s what they don’t want us to know,” said Carlos Mendez, a senior managing director at New York-based ICP Capital LLC, which oversees $22 billion in assets. [more]