Thursday, October 09, 2008

Demons

I will confess...

that I have roamed the blogosphere, and the financial press, seeking to understand just what the hell is going on out there, and that in the course of so doing I have come to haunt the comment boards of Marketwatch. And there I have been exposed to all manner of yahoo freemarketier neo-anarchist lunacy, Joe Sixpacks who have bashed one too many cans against their skulls and revel in the financial chaos that may soon deprive them of their paycheck if not more. People are so very angry out there, angry at the fat cats and weasels that they're happy to see the whole economy come crumbling down just to see the Gucci befooted get their comeuppance. Which is crazy.
...and, ever the rosey-eyed optimist, I have tried to argue rationally with them, and have thrown out the blue state plaints that nobody dares voice in public, but resistance is as quixotic a task as I could be picked, and I find myself progressively warn down and inured to visions of financiak armageddon, to the accompaniment of Brooks & Dunn.

1 comment:

Mitch said...

I understand that financial intermediation is crucial to the economy. What I don't understand is why this particular set of financial intermediaries is so important. If they all crater, will the role of financial intermediary somehow become impossible to fill?

Even if we assume that some sort of government intervention is necessary, there are lots of alternatives that are better than TARP. There are reasons why so many economists were opposed to that plan, like moral hazard, the fact that it ignores the shadow banking system, the fact that buying troubled assets at market valuations won't actually make any of these banks better capitalized, etc. With that context it's difficult to see Paulson's plan as anything other than a giveaway to Wall Street incumbents.