The American Spectator

Lazy Jack| 11.28.09 @ 10:34AM

On Bubbles and Bailouts

If anyone, and I mean anyone, is surprised at the state of the debt at Dubai World, it proves that some people just do not pay attention. The whipping boy for the recent world financial crisis has been the United States, and specifically our property fueled drunkenness. All the smart bankers around the world that invested in sub-prime debt instruments were mere dupes of the intellectually superior bubbas buying homes in Atlanta’s suburbs. And, of course, the dead-eyed subdivisions surrounding American cities were the only place where speculation happened.

Now the truth of the matter begins to seep through. The bubble in Dubai is merely the first major one to drop its trousers in public. What will everyone think when Shanghai or Beijing pops? What about Jakarta, Moscow, or Vancouver?

The reality is there are more shoes to drop. But I say, so what? Bubbles pop, people get hurt, but we survive and move on. The real danger is that the various political, theological, and monarchical classes will use these events as excuses to vest more power in the state and prolong whatever misery is created by the events. At no meaningful time in a century have the marktets been allowed to act without government intervention, often to the great harm of the people. See the U.S. in the thirties and Japan in the nineties for stark examples and bleak results. As scary as the Dubai World risk feels today, at least it is out of hiding and we can deal with it.

At no time since 1932 has a market bubble popped without some savior from the U.S. government intervening. In other words, it has been at least four generations since a market was allowed to heal itself, without a bailout. So how do we know that the markets would not function normally and recover? How could we ever know if fewer people would be harmed? The truth is, we do not. Our only experience is with government intervention before the fact (Fannie Mae and Freddie Mac) and after the fact in the form of the stimulus and the resolution trust, for example. Think about that before you feel the urge to call the government for help; you know, the same government that created the Freddie/Fannie bubble, monster deficits, and perpetually false risk premiums. Lately it feels like we are living inside the movie: “Dr. Strangelove, or How I Learned to Stop Worrying and Love the Bubble.”

Lazy Jack

http://thanksforthelaughs.word.....months-on/

Lazy Jack| 11.28.09 @ 10:34AM

On Bubbles and Bailouts

If anyone, and I mean anyone, is surprised at the state of the debt at Dubai World, it proves that some people just do not pay attention. The whipping boy for the recent world financial crisis has been the United States, and specifically our property fueled drunkenness. All the smart bankers around the world that invested in sub-prime debt instruments were mere dupes of the intellectually superior bubbas buying homes in Atlanta’s suburbs. And, of course, the dead-eyed subdivisions surrounding American cities were the only place where speculation happened.

Now the truth of the matter begins to seep through. The bubble in Dubai is merely the first major one to drop its trousers in public. What will everyone think when Shanghai or Beijing pops? What about Jakarta, Moscow, or Vancouver?

The reality is there are more shoes to drop. But I say, so what? Bubbles pop, people get hurt, but we survive and move on. The real danger is that the various political, theological, and monarchical classes will use these events as excuses to vest more power in the state and prolong whatever misery is created by the events. At no meaningful time in a century have the marktets been allowed to act without government intervention, often to the great harm of the people. See the U.S. in the thirties and Japan in the nineties for stark examples and bleak results. As scary as the Dubai World risk feels today, at least it is out of hiding and we can deal with it.

At no time since 1932 has a market bubble popped without some savior from the U.S. government intervening. In other words, it has been at least four generations since a market was allowed to heal itself, without a bailout. So how do we know that the markets would not function normally and recover? How could we ever know if fewer people would be harmed? The truth is, we do not. Our only experience is with government intervention before the fact (Fannie Mae and Freddie Mac) and after the fact in the form of the stimulus and the resolution trust, for example. Think about that before you feel the urge to call the government for help; you know, the same government that created the Freddie/Fannie bubble, monster deficits, and perpetually false risk premiums. Lately it feels like we are living inside the movie: “Dr. Strangelove, or How I Learned to Stop Worrying and Love the Bubble.”

Lazy Jack

http://thanksforthelaughs.word.....months-on/

Lazy Jack| 11.28.09 @ 10:34AM

On Bubbles and Bailouts

If anyone, and I mean anyone, is surprised at the state of the debt at Dubai World, it proves that some people just do not pay attention. The whipping boy for the recent world financial crisis has been the United States, and specifically our property fueled drunkenness. All the smart bankers around the world that invested in sub-prime debt instruments were mere dupes of the intellectually superior bubbas buying homes in Atlanta’s suburbs. And, of course, the dead-eyed subdivisions surrounding American cities were the only place where speculation happened.

Now the truth of the matter begins to seep through. The bubble in Dubai is merely the first major one to drop its trousers in public. What will everyone think when Shanghai or Beijing pops? What about Jakarta, Moscow, or Vancouver?

The reality is there are more shoes to drop. But I say, so what? Bubbles pop, people get hurt, but we survive and move on. The real danger is that the various political, theological, and monarchical classes will use these events as excuses to vest more power in the state and prolong whatever misery is created by the events. At no meaningful time in a century have the marktets been allowed to act without government intervention, often to the great harm of the people. See the U.S. in the thirties and Japan in the nineties for stark examples and bleak results. As scary as the Dubai World risk feels today, at least it is out of hiding and we can deal with it.

At no time since 1932 has a market bubble popped without some savior from the U.S. government intervening. In other words, it has been at least four generations since a market was allowed to heal itself, without a bailout. So how do we know that the markets would not function normally and recover? How could we ever know if fewer people would be harmed? The truth is, we do not. Our only experience is with government intervention before the fact (Fannie Mae and Freddie Mac) and after the fact in the form of the stimulus and the resolution trust, for example. Think about that before you feel the urge to call the government for help; you know, the same government that created the Freddie/Fannie bubble, monster deficits, and perpetually false risk premiums. Lately it feels like we are living inside the movie: “Dr. Strangelove, or How I Learned to Stop Worrying and Love the Bubble.”

Lazy Jack

http://thanksforthelaughs.word.....months-on/

Lazy Jack| 11.28.09 @ 10:34AM

On Bubbles and Bailouts

If anyone, and I mean anyone, is surprised at the state of the debt at Dubai World, it proves that some people just do not pay attention. The whipping boy for the recent world financial crisis has been the United States, and specifically our property fueled drunkenness. All the smart bankers around the world that invested in sub-prime debt instruments were mere dupes of the intellectually superior bubbas buying homes in Atlanta’s suburbs. And, of course, the dead-eyed subdivisions surrounding American cities were the only place where speculation happened.

Now the truth of the matter begins to seep through. The bubble in Dubai is merely the first major one to drop its trousers in public. What will everyone think when Shanghai or Beijing pops? What about Jakarta, Moscow, or Vancouver?

The reality is there are more shoes to drop. But I say, so what? Bubbles pop, people get hurt, but we survive and move on. The real danger is that the various political, theological, and monarchical classes will use these events as excuses to vest more power in the state and prolong whatever misery is created by the events. At no meaningful time in a century have the marktets been allowed to act without government intervention, often to the great harm of the people. See the U.S. in the thirties and Japan in the nineties for stark examples and bleak results. As scary as the Dubai World risk feels today, at least it is out of hiding and we can deal with it.

At no time since 1932 has a market bubble popped without some savior from the U.S. government intervening. In other words, it has been at least four generations since a market was allowed to heal itself, without a bailout. So how do we know that the markets would not function normally and recover? How could we ever know if fewer people would be harmed? The truth is, we do not. Our only experience is with government intervention before the fact (Fannie Mae and Freddie Mac) and after the fact in the form of the stimulus and the resolution trust, for example. Think about that before you feel the urge to call the government for help; you know, the same government that created the Freddie/Fannie bubble, monster deficits, and perpetually false risk premiums. Lately it feels like we are living inside the movie: “Dr. Strangelove, or How I Learned to Stop Worrying and Love the Bubble.”

Lazy Jack

http://thanksforthelaughs.word.....months-on/

Oldefarte| 11.28.09 @ 11:31AM

And we SHOULD ALL KNOW WHO/WHAT is represented by that 37%, right????? [But 37% of voters now worry that the federal government will not do enough in dealing with the current economic situation. Forty-two percent (42%) felt that way in late January]. Maybe I sould attempt to be more POLITICALLY CORRECT [like most everyone else] and avoid pointing out things such as this fact!!!!!!!!!!!!!!!

Mikkal Travvis| 11.28.09 @ 11:06PM

Let's enlist Michele Bachmann to run in 2012:

http://michelebachmannforpresi.....gspot.com/

Charles Martel| 11.28.09 @ 11:14PM

The first entry in "The Week" in NRODT some months back: "Please, no one tell Obama what comes after a trillion."

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