Re: flat wrong....
- From: "Sid9" <sid9@xxxxxxxxxxxxx>
- Date: Fri, 10 Oct 2008 19:44:36 -0400
"Brian David Smith" <smsc@xxxxxxx> wrote in
message news:glRHk.3$3H7.2@xxxxxxxxxxxxxxx
The administration is flat wrong....!!!Paul Krugman for Sec'y of Treasury under President
About the Wall Street bailout, on September 19th
George Bush told us, "We must join to move
urgently needed legislation as quickly as
possible."
So there was this hurry up rush to fork over a
$700 billion bailout.
Since then the stock market has lost over 1
trillion dollars.
Since then the stock market had it largest
single day drop ever.
Since then the Dow Jones industrial average,
founded in the late 19th century, had never seen
six consecutive daily declines, except for this
month.
But yet. today Bush told us "the plan we are
executing is aggressive. It is the right plan.
It will take time to have its full impact."
He says.."it will take time" !?!?!?!?
Well then, what was the big hurry up rush all
about then?
What is Bush thinking?
Remember this is the same George Bush that told
us Saddam Hussein had upwards of 30,000
munitions capable of delivering chemical agents
and that Hussein had several mobile biological
weapons labs, that is "Winnebagos of Death."
None of that was true. Bush was wrong.
The Bush presidency has been wrong on
everything.
Wrong about invading Iraq when there was no
threat whatsoever -- killing over 4000 of our
young people for no reason.
Wrong about stripping down FEMA leaving it
ineffectual when Katrina hit - killing over 1700
people.
Wrong about privatizing Social Security.
Wrong about an unworkable Medicare prescription
plan, that no one can follow.
Wrong about telling Americans to go shopping
after 9-eleven instead of getting behind a
legitimate war effort.
Bottom line, Bush has been the worst president
this country has ever suffered, and now he wrong
about fixing our economy.
Brian David Smith, San Diego, California
Obama!
The following is Paul Krugman's column from
today's NYTimes:
October 10, 2008
Op-Ed Columnist
Moment of Truth
By PAUL KRUGMAN
Last month, when the U.S. Treasury Department
allowed Lehman Brothers to fail, I wrote that
Henry Paulson, the Treasury secretary, was playing
financial Russian roulette. Sure enough, there was
a bullet in that chamber: Lehman?s failure caused
the world financial crisis, already severe, to get
much, much worse.
The consequences of Lehman?s fall were apparent
within days, yet key policy players have largely
wasted the past four weeks. Now they?ve reached a
moment of truth: They?d better do something soon ?
in fact, they?d better announce a coordinated
rescue plan this weekend ? or the world economy
may well experience its worst slump since the
Great Depression.
Let?s talk about where we are right now.
The current crisis started with a burst housing
bubble, which led to widespread mortgage defaults,
and hence to large losses at many financial
institutions. That initial shock was compounded by
secondary effects, as lack of capital forced banks
to pull back, leading to further declines in the
prices of assets, leading to more losses, and so
on ? a vicious circle of ?deleveraging.? Pervasive
loss of trust in banks, including on the part of
other banks, reinforced the vicious circle.
The downward spiral accelerated post-Lehman. Money
markets, already troubled, effectively shut down ?
one line currently making the rounds is that the
only things anyone wants to buy right now are
Treasury bills and bottled water.
The response to this downward spiral on the part
of the world?s two great monetary powers ? the
United States, on one side, and the 15 nations
that use the euro, on the other ? has been
woefully inadequate.
Europe, lacking a common government, has literally
been unable to get its act together; each country
has been making up its own policy, with little
coordination, and proposals for a unified response
have gone nowhere.
The United States should have been in a much
stronger position. And when Mr. Paulson announced
his plan for a huge bailout, there was a temporary
surge of optimism. But it soon became clear that
the plan suffered from a fatal lack of
intellectual clarity. Mr. Paulson proposed buying
$700 billion worth of ?troubled assets? ? toxic
mortgage-related securities ? from banks, but he
was never able to explain why this would resolve
the crisis.
What he should have proposed instead, many
economists agree, was direct injection of capital
into financial firms: The U.S. government would
provide financial institutions with the capital
they need to do business, thereby halting the
downward spiral, in return for partial ownership.
When Congress modified the Paulson plan, it
introduced provisions that made such a capital
injection possible, but not mandatory. And until
two days ago, Mr. Paulson remained resolutely
opposed to doing the right thing.
But on Wednesday the British government, showing
the kind of clear thinking that has been all too
scarce on this side of the pond, announced a plan
to provide banks with £50 billion in new capital ?
the equivalent, relative to the size of the
economy, of a $500 billion program here ? together
with extensive guarantees for financial
transactions between banks. And U.S. Treasury
officials now say that they plan to do something
similar, using the authority they didn?t want but
Congress gave them anyway.
The question now is whether these moves are too
little, too late. I don?t think so, but it will be
very alarming if this weekend rolls by without a
credible announcement of a new financial rescue
plan, involving not just the United States but all
the major players.
Why do we need international cooperation? Because
we have a globalized financial system in which a
crisis that began with a bubble in Florida condos
and California McMansions has caused monetary
catastrophe in Iceland. We?re all in this
together, and need a shared solution.
Why this weekend? Because there happen to be two
big meetings taking place in Washington: a meeting
of top financial officials from the major advanced
nations on Friday, then the annual International
Monetary Fund/World Bank meeting Saturday and
Sunday. If these meetings end without at least an
agreement in principle on a global rescue plan ?
if everyone goes home with nothing more than vague
assertions that they intend to stay on top of the
situation ? a golden opportunity will have been
missed, and the downward spiral could easily get
even worse.
What should be done? The United States and Europe
should just say ?Yes, prime minister.? The British
plan isn?t perfect, but there?s widespread
agreement among economists that it offers by far
the best available template for a broader rescue
effort.
And the time to act is now. You may think that
things can?t get any worse ? but they can, and if
nothing is done in the next few days, they will.
.
- References:
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- From: Brian David Smith
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