The "New Deal"

"Neither a wise man nor a brave man lies down on the tracks of history to wait for the train of the future to run over him"
Dwight D. Eisenhower

In my opinion, we have now officially passed the point where return to the "raw capitalist" functioning of our entire economic system was still feasible... I don't know what exact form will the next phase take yet, but the current system is officially over, finished, done, caput or whatever else you want to call it! The week of September 15th 2008 will not only go down as one of the most defining moments in the history of the United States, but my son will probably spend as much time reading about the consequences in the history books as I did about the Second World War...

Forget the small potatoes of "moral hazard" from Bear Sterns and Fannie/Freddie bailouts, or the "unofficial" existence of the "Bernanke/Greenspan" rate cut put option for the US stock market- the new "mother of all moral hazards" has been formed by the Paulson/Bernanke pair... Not only they changed the rules in the middle of the stock market game by de facto banning all short selling, but they also committed to put up an unprecedented $700B in taxpayer's (mine and yours) funds at risk just to prevent the "collapse" of "entire financial system"...

Vad, our resident Skeptical Capitalist, is less than impressed with the government's decision to step in... He sounds off in his latest post. Read the rest from Vad.

by The Freshman |  09/22/08