These greedheads think the world owes them a huge return on their leveraged dollars, and that the rest of us can suck eggs. The Fed is using low interest rates and inflation and a weak dollar to save these scumbags, and in the process it is destroying the resources of savers and financially conservative investors. It really makes me incredibly angry.

Of course, we have no recourse. There are no agencies to protect us, and we have no private right of action to protect ourselves from these thieves. We are well and truly f—d.

China and India MUST be thrilled!

Per masaccio, if I am interpreting correctly, this deflationary cycle has to be done, but it also has to be done prudently. We’re involved in a very high stakes game of “hot-potato,” who gets stuck with the worthless paper?

With trillions on the line, Wall Street contributions to the GOP and Dems into the hundreds of millions to “socialize their losses,” are peanuts.

OT, is this “term security lending facility” a back door way to trade TBills for worthless securities?

Major U.S. investment banks and broker-dealers submitted bids for 28-day loans of $86.1 billion of Treasurys from the Federal Reserve’s new term security lending facility on Thursday, with the Fed accepting $75 billion, for a bid-to-cover ratio of 1.15.

OT, who is watching the FED? It seems to me that with them “accepting” collateral that no one else wants, the opportunities for fraud at the taxpayer’s expense are just massive.

OT, GOP has every reason to postpone the inevitable deflation until January 2009, so they can blame it on the Dems. Can someone please explain this to Harry and Nancy?

That means acknowledging that our economic crisis is, at its core, a housing crisis, a crisis caused in part by unscrupulous mortgage lenders and brokers and unregulated transactions in mortgage-backed securities, in part by speculators who were buying multiple houses to sell for a quick buck and other buyers who didn’t act responsibly. And in part by a president and administration who failed to anticipate and continue to downplay the problems we face.

This is from Obama.

As I said at NASDAQ last September: the core of our economic success is the fundamental truth that each American does better when all Americans do better; that the well being of American business, its capital markets, and the American people are aligned.
I think all of us here today would acknowledge that we’ve lost that sense of shared prosperity.
This loss has not happened by accident. It’s because of decisions made in boardrooms, on trading floors and in Washington. Under Republican and Democratic Administrations, we failed to guard against practices that all too often rewarded financial manipulation instead of productivity and sound business practices. We let the special interests put their thumbs on the economic scales. The result has been a distorted market that creates bubbles instead of steady, sustainable growth; a market that favors Wall Street over Main Street, but ends up hurting both

Our candidates speak with an essential seriousness about a serious problem. They put it in context, and tell us what the problem is, and then offer solutions. Now, compare our candidates to the other guy:

While I was traveling overseas, our financial markets experienced another round of upheaval. This market turmoil leaves many Americans feeling both concerned and angry. People see the value of their homes fall at the same time that the price of gasoline and food is rising. Already tight household budgets are getting tighter. A lot of Americans read the headlines about credit crunches and liquidity crises and ask: “How did we get here?” In the end, the motivation and behaviors that caused the current crisis are not terribly complicated, even though the alphabet soup of financial instruments is complex. The past decade witnessed the largest increase in home ownership in the past 50 years. Home ownership is part of the American dream, and we want as many Americans as possible to be able to afford their own home. But in the process of a huge, and largely positive, upturn in home construction and ownership, a housing bubble was created.
A bubble occurs when prices are driven up too quickly….

Republican in trouble? Passive voice to the rescue. Whenever you see that formulation, you can be sure that there won’t be a plausible response. It looks like someone forgot to say what the “motivations and behaviors that caused the current crisis” were, or maybe it got deleted. My earlier comment shows the futility of looking to that group of squirrels for answers.

I like Obama’s description of the problem better than HRC’s, because Obama puts corporate dominance of government up front as a cause, leading him to demand better regulation as the first step, where HRC diffuses the cause issue over several fronts, including the homebuyers, and doesn’t point to the anti-regulatory fever that swept over DC during the last 30 years.

Both of our candidates say what they are doing now to deal with the mess, by supporting the Dodd-Frank bill, and other things. This is weak, but these bills aren’t going to get anywhere anyway with the roadblock republicans essentially running the Senate. They both support regulatory change, and that will make a difference in the future. Obama talks about principles in a way that suits my temperament, while HRC wants to get advice from the likes of Greenspan, the bubble king. I particularly don’t like her calling a gathering of Greenspan, Rubin and Volcker “non-partisan”. This is as rabid a group of free marketeers as you will ever see, and Greenspan in particular had every non-partisan atom in his body removed and replaced with an equivalent Randian particle.

Your candidate’s speech reflects the campaign of your candidate extremely well, and it is worth reading not-your-candidate’s speech to see a good picture of just how competent not-your-candidate is, especially as compared to the other party’s candidate.

Similarly, options may have gotten favorable accounting treatment, but again, that is not a problem with the Black-Scholes formula, but with the conventions set forth by the FASB.