Tuesday, September 16, 2008

Suddenly, the mattress looks like a pretty good place to keep my money

Here's the recent tally:

1) When Bear Sterns is in trouble, the federal govt subsidizes its acquisition by JP Morgan Chase.

2) When Fannie Mae and Freddie Mac are in trouble, the federal govt takes them over outright.

3) When Lehman Bros. is in trouble, the executive branch of the federal govt does nothing, leaving the bankruptcy court to sort things out.

4) When Merrill Lynch is in trouble, the federal government watches closely, and then breathes a sigh of relief as Bank of America buys it. (Bank of America shareholders are likely making a different kind of sound.)

5) When AIG is in trouble, the federal government jawbones other banks to lend it some dough (after NY State permits AIG to dip into its subsidiaries' reserves).

Is there a rationalizing principle for this bewildering combination of actions and inactions? Each move can be explained as individually sensible: Taking over Fannie and Freddie made sense given that they were already quasi-governmental; taking no action on Merrill was appropriate given the willingness of the private sector to come forward; etc. But one senses that Ben Bernanke and Hank Paulson don't have an overall set of principles guiding their decisions.

And yet, operating almost by feel, Bernanke and Paulson are probably the two most capable high-ranking Bush appointees (which is not necessarily to say they'll be able to prevent a worsening of the current financial situation). By contrast, SEC Chairman Chris Cox (remember him?) does appear to have a guiding philosophy, or rather ideology: namely, the markets are just about always just fine, so government doing anything will almost always make things worse.

The emerging post-Ike narrative has it that the Administration learned from Katrina that cronyism is no substitute for professional management, and there's a lot to that. But the contrast between the creative improvisation by Bernanke and Paulson, on the one hand, and free-market ideology by Cox, on the other, should serve as a reminder that heck-of-a-job cronyism was only part of the story of the errors of the Bush Administration. It explains, for example, how the Administration bungled the Iraq occupation. The other, and probably larger, piece of the story of the Bush Administration (at least prior to the 2006 midterm election) was ideologically driven bungling. If the Cheney/Wolfowitz branch of the Bush White House had not decided to go into Iraq in the first place, Paul Bremer never would have had the chance to disband the Iraqi army.

And no, of course I'm not saying that Chris Cox is responsible for the financial crisis, except to the extent that he, as a Congressman, was quite enthusiastic about deregulating financial services. Plenty of Democrats were also enthusiastic, so this is a bipartisan mess. Still, if we go back and look for the single person most responsible for financial services deregulation, it would be hard to find a better candidate than John McCain's good buddy, economic guru, and former campaign co-chairman, Phil Gramm. That would be bad news for McCain's campaign, but only in a reality-based election.

Posted by Mike Dorf

12 comments:

Craig J. Albert said...

I may write a separate entry on this later, but I had thinking about these questions on the way to work, and since you asked, well . . .

I'm troubled by the fact that we're now paying the price of not heeding the warnings that were made when we started to go down this road many years ago. Blame can be shared by Democrats and Republicans alike, for failing to heed the lessons of the past becasue of the promise of a rosier future than the rosy future we already had. Simply put, we were greedy and stupid.

Beginning slowly with Nixon and Ford, then picking up steam under Carter, industry after industry was deregulated in whole or in part. Trucking, buses, rail, airlines, telephone, banks, insurance, stock brokerage, credit cards, and energy are some of the major industries which were deregulated in whole or in part. And I'd like to note in particular that much of the financial services deregulation was enacted in order to overturn the protections that were put in place during the New Deal. Those decisions have now come back to haunt us.

Of particular interest to me are the financial services "reforms", which began slowly in the 1970s with the invention of a means to permit commercial banks to pay interest on checking accounts and to allow savings banks to compete with them by the creation of an instrument that looked and worked like a check, but wasn't a check (the "negotiable order of withdrawal"). The deregulation stepped up with the passage of the Garn-St Germain Depositary Institutions Act in 1982 (Reagan), which deregulated the S&L industry (leading to the 1980s S&L crisis) and finally the Gramm-Leach-Bliley Financial Services Modernization Act in 1999 (Clinton), which repealed the Glass-Steagall Act, thereby enabling banks to own brokers, and vice versa.

Now, I am not arguing that there have been no benefits to consumers from deregulation; in many instances, there have been tremendous benefits, both in terms of price and in terms of innovation. But it's also important to realize that we've paid a price measured in instability, discontinuities and redistribution.

egarber said...

I keep thinking of the "ownership" issue. Derivatives, swaps and securitization were all designed to create efficiencies in the market; the "underlying value" of almost anything could be unleashed and traded. But then came ownership dilution, which ostensibly spreads risk. However, instead of spreading risk, the world of tranches and bond insurance *hid* it.

Barry said...

Good posts and comments. It will be interesting to see whether the McCain flip flops on regulation and missteps (a la the now muzzled Carly F) will impact poll numbers.

One other semi-related thought - why is it that NEITHER campaign has spoken up about the anticipated rise in gasoline prices as a consequence of Ike while the price per barrel falls rapidly? Isn't the price increase kind of like looting or at least predatory pricing?

sexy said...

情趣用品,情趣用品,情趣用品,情趣用品,情趣用品,情趣用品,情趣,情趣,情趣,情趣,情趣,情趣,按摩棒,跳蛋,充氣娃娃,情境坊歡愉用品,情趣用品,情人節禮物,情惑用品性易購

免費A片,AV女優,美女視訊,情色交友,免費AV,色情網站,辣妹視訊,美女交友,色情影片,成人影片,成人網站,A片,H漫,18成人,成人圖片,成人漫畫,情色網,日本A片,免費A片下載,性愛

A片,色情,成人,做愛,情色文學,A片下載,色情遊戲,色情影片,色情聊天室,情色電影,免費視訊,免費視訊聊天,免費視訊聊天室,一葉情貼圖片區,情色,情色視訊,免費成人影片,視訊交友,視訊聊天,視訊聊天室,言情小說,愛情小說,AIO,AV片,A漫,av dvd,聊天室,自拍,情色論壇,視訊美女,AV成人網,色情A片,SEX

情趣用品,A片,免費A片,AV女優,美女視訊,情色交友,色情網站,免費AV,辣妹視訊,美女交友,色情影片,成人網站,H漫,18成人,成人圖片,成人漫畫,成人影片,情色網


情趣用品,A片,免費A片,日本A片,A片下載,線上A片,成人電影,嘟嘟成人網,成人,成人貼圖,成人交友,成人圖片,18成人,成人小說,成人圖片區,微風成人區,成人文章,成人影城,情色,情色貼圖,色情聊天室,情色視訊,情色文學,色情小說,情色小說,臺灣情色網,色情,情色電影,色情遊戲,嘟嘟情人色網,麗的色遊戲,情色論壇,色情網站,一葉情貼圖片區,做愛,性愛,美女視訊,辣妹視訊,視訊聊天室,視訊交友網,免費視訊聊天,美女交友,做愛影片

av,情趣用品,a片,成人電影,微風成人,嘟嘟成人網,成人,成人貼圖,成人交友,成人圖片,18成人,成人小說,成人圖片區,成人文章,成人影城,愛情公寓,情色,情色貼圖,色情聊天室,情色視訊,情色文學,色情小說,情色小說,色情,寄情築園小遊戲,情色電影,aio,av女優,AV,免費A片,日本a片,美女視訊,辣妹視訊,聊天室,美女交友,成人光碟

情趣用品.A片,情色,情色貼圖,色情聊天室,情色視訊,情色文學,色情小說,情色小說,色情,寄情築園小遊戲,情色電影,色情遊戲,色情網站,聊天室,ut聊天室,豆豆聊天室,美女視訊,辣妹視訊,視訊聊天室,視訊交友網,免費視訊聊天,免費A片,日本a片,a片下載,線上a片,av女優,av,成人電影,成人,成人貼圖,成人交友,成人圖片,18成人,成人小說,成人圖片區,成人文章,成人影城,成人網站,自拍,尋夢園聊天室

sex999 said...

A片,A片,情色,情色,A片,A片,情色,情色,A片,A片,A片下載,做愛,成人電影,.18成人,日本A片,情色小說,情色電影,成人影城,自拍,情色論壇,成人論壇,情色貼圖,情色,免費A片,成人,成人網站,成人圖片,AV女優,成人光碟,色情,色情影片,免費A片下載,SEX,AV,色情網站,本土自拍,性愛,成人影片,情色文學,成人文章,成人圖片區,成人貼圖

美女交友,AIO交友愛情館,AIO,成人交友,視訊交友網,視訊交友,拓網交友,PC交友,視訊交友90739,交友,情色交友,聊天室交友,辣妹視訊,視訊辣妹,美女視訊,視訊美女,情色視訊,日本AV,免費視訊聊天,視訊聊天,AV女優,AV,視訊聊天室,視訊,免費視訊,情人視訊網,本土自拍,自拍,AVDVD,SEX,微風成人,微風論壇,微風成人區,成人網站,成人,成人電影,嘟嘟成人網,成人貼圖,成人影片,成人圖片區,成人圖片,18成人,成人小說,成人影城,成人文章,成人論壇,愛情公寓,情色論壇,情色,色情聊天室,色情,情色貼圖,情色文學,色情小說,情色小說,寄情築園小遊戲,色情遊戲,情色電影,情色網,做愛,UT聊天室,聊天室,聊天,哈拉聊天室,豆豆聊天室,尋夢園聊天室,聊天室尋夢園,080苗栗人聊天室,苗栗人聊天室,080中部人聊天室,080聊天室,中部人聊天室,柔情聊天網,6K聊天室,小高聊天室,上班族聊天室,免費A片,A片,成人聊天室,一夜情聊天室,情色聊天室,色色網,免費AV

路傑 said...

免費A片, ut聊天室, AV女優, 美女視訊, 免費成人影片, 成人論壇, 情色交友, 免費AV, 線上a片, 日本美女寫真集, 同志聊天室, 聊天室交友, 成人文章, 成人圖片區, 色情網站, 辣妹視訊, 美女交友, 微風成人區, 色美媚部落格, 色情影片, 成人影片, 成人網站, 免費A片, 上班族聊天室, A片,H漫, 18成人, a漫, av dvd, 一夜情聊天室, 微風成人, 成人圖片, 成人漫畫, 情色網, 日本A片, 免費A片下載, 性愛, 成人交友, 嘟嘟成人網, 嘟嘟成人網, 成人貼圖, 成人電影, 成人, 中部人聊天室, 080中部人聊天室, 成人貼圖, 成人小說, 成人文章, 成人圖片區, 免費成人影片, 成人遊戲, 微風成人, 愛情公寓, 成人電影, A片, 情色, 情色貼圖, 情色文學, 做愛, 成人遊戲, 成人影城, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 寄情築園小遊戲, 色情遊戲, 成人網站, 麗的色遊戲, 色情網站, 成人論壇, 情色視訊, 情色電影, aio交友愛情館, 言情小說, 愛情小說, 色情A片, 情色論壇, 自拍, 癡漢, , 俱樂部, 豆豆聊天室, 聊天室, 色情影片, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊交友90739 情人視訊網影音視訊聊天室 免費視訊聊天室 視訊聊天 視訊交友 美女視訊 視訊美女 視訊 免費視訊 免費視訊聊天 視訊聊天室 辣妹視訊 一夜情 色情a片 aio交友愛情館 情色電影 情色視訊 色情遊戲 色情 情色小說 一葉情貼圖片區 色情小說 色情聊天室 情色交友 成人論壇 成人網站 色情網站 情色論壇 小高聊天室 女同志聊天室 6K聊天室 080苗栗人聊天室 080聊天室 聊天室尋夢園 UT男同志聊天室 男同志聊天室 尋夢園聊天室 UT聊天室 聊天室 豆豆聊天室 A片 成人電影 成人貼圖 嘟嘟成人網 美女交友 本土自拍 成人交友 成人影片http://ssff01.3b8mm.com/

路傑 said...

免費A片, ut聊天室, AV女優, 美女視訊, 免費成人影片, 成人論壇, 情色交友, 免費AV, 線上a片, 日本美女寫真集, 同志聊天室, 聊天室交友, 成人文章, 成人圖片區, 色情網站, 辣妹視訊, 美女交友, 微風成人區, 色美媚部落格, 色情影片, 成人影片, 成人網站, 免費A片, 上班族聊天室, A片,H漫, 18成人, a漫, av dvd, 一夜情聊天室, 微風成人, 成人圖片, 成人漫畫, 情色網, 日本A片, 免費A片下載, 性愛, 成人交友, 嘟嘟成人網, 嘟嘟成人網, 成人貼圖, 成人電影, 成人, 中部人聊天室, 080中部人聊天室, 成人貼圖, 成人小說, 成人文章, 成人圖片區, 免費成人影片, 成人遊戲, 微風成人, 愛情公寓, 成人電影, A片, 情色, 情色貼圖, 情色文學, 做愛, 成人遊戲, 成人影城, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 寄情築園小遊戲, 色情遊戲, 成人網站, 麗的色遊戲, 色情網站, 成人論壇, 情色視訊, 情色電影, aio交友愛情館, 言情小說, 愛情小說, 色情A片, 情色論壇, 自拍, 癡漢, , 俱樂部, 豆豆聊天室, 聊天室, 色情影片, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊交友90739 情人視訊網影音視訊聊天室 免費視訊聊天室 視訊聊天 視訊交友 美女視訊 視訊美女 視訊 免費視訊 免費視訊聊天 視訊聊天室 辣妹視訊 一夜情 色情a片 aio交友愛情館 情色電影 情色視訊 色情遊戲 色情 情色小說 一葉情貼圖片區 色情小說 色情聊天室 情色交友 成人論壇 成人網站 色情網站 情色論壇 小高聊天室 女同志聊天室 6K聊天室 080苗栗人聊天室 080聊天室 聊天室尋夢園 UT男同志聊天室 男同志聊天室 尋夢園聊天室 UT聊天室 聊天室 豆豆聊天室 A片 成人電影 成人貼圖 嘟嘟成人網 美女交友 本土自拍 成人交友 成人影片http://ssff01.3b8mm.com/

kutyhgvd said...

I always heard something from my neighbor that he sometimes goes to the internet bar to play the game which will use him some gw gold,he usually can win a lot of GuildWars Gold,then he let his friends all have some Guild Wars Gold,his friends thank him very much for introducing them the GuildWars money,they usually cheap gw gold together.

. said...

酒店喝酒,禮服店,酒店小姐,酒店經紀,制服店,便服店,鋼琴酒吧,兼差,酒店兼差,酒店打工,伴唱小姐,暑假打工,酒店上班,日式酒店,舞廳,ktv酒店,酒店,酒店公關,酒店小姐,理容院,日領,龍亨,學生兼差,酒店兼差,酒店上班,酒店打工,禮服酒店,禮服店 ,酒店小姐,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,台北酒店,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,禮服店 ,酒店小姐,酒店經紀,酒店兼差,寒暑假打工,酒店小姐,經紀 彩色爆米花,經紀人 彩色爆米花,酒店傳播,酒店經紀 彩色爆米花,爆米花,童裝,童裝拍賣,童裝大盤,童裝寄賣,童裝批貨,酒店,酒店,童裝切貨,酒店,GAP童裝,酒店,酒店 ,禮服店 , 酒店小姐,酒店經紀,酒店兼差,寒暑假打工

wsty said...

www.eshooes.com .
www.pumafr.com.
www.myshoess.com.
[url=http://www.pumafr.com]puma shoes[/url]
[url=http://www.eshooes.com]chaussures puma[/url]
[url=http://www.myshoess.com]nike air max ltd[/url]

酒店經紀ㄚ君姐姐 said...

,,姐.,便服/,,

freefun0616 said...

酒店經紀人, 菲梵酒店經紀, 酒店經紀, 禮服酒店上班, 酒店小姐兼職, 便服酒店經紀, 酒店打工經紀, 制服酒店工作, 專業酒店經紀, 合法酒店經紀, 酒店暑假打工, 酒店寒假打工, 酒店經紀人, 菲梵酒店經紀, 酒店經紀, 禮服酒店上班, 酒店經紀人, 菲梵酒店經紀, 酒店經紀, 禮服酒店上班, 酒店小姐兼職, 便服酒店工作, 酒店打工經紀, 制服酒店經紀, 專業酒店經紀, 合法酒店經紀, 酒店暑假打工, 酒店寒假打工, 酒店經紀人, 菲梵酒店經紀, 酒店經紀, 禮服酒店上班, 酒店小姐兼職, 便服酒店工作, 酒店打工經紀, 制服酒店經紀,,