The Financial Crisis A-Z
Over at Forbes.com, former WSJ OpEd page editor — but don’t hold that against him — Tunku Varadarajan writes a terribly amusing recap of the global monetary mayhem, titled: The Financial Crisis, From A-Z.
It may be just me, but it has a certain DanGrossian feel about it. To give you some flavor, A – E is below:
A is for America, the big swinging Richard whose dysfunction started it all. Think also of accountability (lack of); AIG (which has cost the U.S. $140 billion, and counting–who knew insurance could be so exciting!); assets ( what assets?), and Adam Smith, who’s slapping us about the face — with his invisible hand .
B boasts Ben Bernanke, known, lovingly, as “Helicopter Ben,” who’s clearly no Greenspan, um … Volcker, um … Morgan. And isn’t it swell that he’s an expert on the Great Depression and its causes? Bear Sterns was the big, fat canary in the coal-mine, whose death-trill was the first note of a symphony known as the bailout. B is also for balance sheet and belt-tightening.
C is for Credit Default Swaps, defined for me by a Wall Street watcher as: Risk whatever you want, and we insure it; risk too much, taxpayers insure it. And there are those CDOs (pronounced “seedy owes”) that were all the rage at Citigroup, one of many tarnished poster children of capitalism, a philosophy that’s taken a hefty write-down. ( Congress certainly doesn’t believe in it.) And then there’s Christopher Cox, whose finger was never going to be big enough for the dike, poor bloke.
D is Depression: Yes, we’re in one, and it’s going global. The trouble is we’ve already used “Great” in 1929. So we need a new superlative. D is also for debt; and for deregulation: Some say we had too little of it, others that we had too much. (This analytical Pushme-Pullyu bodes ill for a swift recovery.)
E is for excess (of, for example, executive pay and easy money).
America, the big swinging Richard. Can’t say I’ve ever read those words in precisely that order before . . .
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Source:
The Financial Crisis, From A-Z
Tunku Varadarajan 11.10.08, 12:00 AM ET
Los Estados Unidos
http://www.forbes.com/opinions/2008/11/09/financial-crisis-tarp-oped-cx_tv_1110varadarajan.html
November 11th, 2008 at 4:57 pm
Very musical. A cast of recent media hypocrites would make a suitable encore.
November 11th, 2008 at 4:58 pm
W is for the Wall St. Journal peddling the worst advice to working men and women around the world!
November 11th, 2008 at 4:59 pm
another must read: Michael Lewis’s piece “The End of Wall Street”
http://www.portfolio.com/news-markets/national-news/portfolio/2008/11/11/The-End-of-Wall-Streets-Boom?print=true
best quote: “But he couldn’t figure out exactly how the rating agencies justified turning BBB loans into AAA-rated bonds. “I didn’t understand how they were turning all this garbage into gold,” he says. He brought some of the bond people from Goldman Sachs, Lehman Brothers, and UBS over for a visit. “We always asked the same question,” says Eisman. “Where are the rating agencies in all of this? And I’d always get the same reaction. It was a smirk.” He called Standard & Poor’s and asked what would happen to default rates if real estate prices fell. The man at S&P couldn’t say; its model for home prices had no ability to accept a negative number. “They were just assuming home prices would keep going up,” Eisman says.”
November 11th, 2008 at 5:13 pm
With regards to a new superlative: The editor of top toll roads webzine tollroadsnews.com calls the current crisis the Great Global Financial Fiasco, or G2F2. Catchy, non?
November 11th, 2008 at 5:29 pm
My favorite grim A-Z is Edward Gorey’s The Gashlycrumb Tinies
A is for Amy who fell down the stairs
B is for Basil assaulted by bears
C is for Clara who wasted away
D is for Desmond thrown out of a sleigh
E is for Ernest who choked on a peach
F is for Fannie sucked dry by a leech…
The illustrations are fabulous. Just don’t use the book to teach your child the ABCs. http://www.geocities.com/sunsetstrip/stage/7535/gorey.html
This is begging to be turned into the Wallstreet Tinies (or Greenspancrumb Tinies or whatever amuses)…
November 11th, 2008 at 5:30 pm
That Michael Lewis article (original hat tip, Karen) is a MUST-read for any layperson who wants to get to the heart of this mess.
The jig is finally up on Wall Street. When/How/Why would anyone trust these jackals again? Are we really that stupid as a species? Wait, don’t answer that question……
November 11th, 2008 at 5:37 pm
It can not be a depression. Although equities are priced as such energy, telecom for examples aren’t.
Look at a 2 year chart of XOM over USO.
My projection is a very sharped V shaped recovery.
November 11th, 2008 at 5:44 pm
@jmborchers: Depression, deep recession, it’s all just semantics. Either way, this is going to be incredibly ugly……..
November 11th, 2008 at 5:52 pm
Because the majority of people are thinking depression now it will likely not be.
It’s the same as last year when traffic on Barry’s site was small and cinefoz n company were calling for Dow 18K and people here were saying no way.
I was one of the ones saying no way then now I’m doing the same but on the opposite side.
When the stock market trades on negative speculation instead of positive speculation that’s a good sign long term.
November 11th, 2008 at 6:25 pm
And another good story here:
=====================
The End
by Michael Lewis Nov 11 2008
The era that defined Wall Street is finally, officially over. Michael Lewis, who chronicled its excess in Liar’s Poker, returns to his old haunt to figure out what went wrong.
Link
=====================
November 11th, 2008 at 6:26 pm
L is for leverage (a means of maximizing your losses).
LOLOL
This is brilliant.
Kinda like Richard Pryor at his peak.
Brutally honest…and completely hilarious.
http://www.youtube.com/watch?v=wg9fKFmtU3E
November 11th, 2008 at 6:26 pm
Damm – missed the prior post about Michael Lewis’s story.
Should be some way to delete posts here!
November 11th, 2008 at 6:26 pm
“The majority of people are thinking depression?” Where? Who? Maybe on this site they are but certainly not on Wall Street, where they’re STILL selling the loony “buy the dips” and hold mantra…….
I think it depends on which sampling you’re referring to, but certainly the majority of people don’t think a recession is coming.
I’m not necessarily calling for a “Depression” per se but I do think it will be the worst, more protracted recession we’ve seen in a long, long time, certainly not a “V” shaped one. How exactly do we get out of this mess, aside from inflating our way out of it (which they’re trying now with not much success)?
November 11th, 2008 at 6:29 pm
I meant “the majority of people don’t think a “Depression” is coming………
jmborchers – you may be right here but I just can’t see how this recession won’t be really bad. Call it what you want but it’s going to be really bad. Sometimes the crowds ARE right for a little while anyway.
November 11th, 2008 at 6:31 pm
“It can not be a depression. ”
JB
“Ignorance is preferable to error, and he is less remote from the truth who believes nothing than he who believes what is wrong.”
Thomas Jefferson
November 11th, 2008 at 6:38 pm
I was out at my local big mall today, looking for computer parts. It was a zoo, reminded me of christmas eve. In contrast to the week before the election when it was a crypt. I am suspecting the retail numbers will look a little better this month.
November 11th, 2008 at 6:41 pm
Go ask somebody who lives in Wilmington, OH if we are in a depression.
Go ask my friend who lives in STL, a board certified medical physicist who got laid off last week, if we’re in a depression.
Go ask someone who is trying to sell cars or boats for a living if we’re in a depression.
Real people, not folks with trading portfolios and home offices, are getting squeezed like never before.
And it appears to just be accelerating at the moment.
A lot of folks are hanging by a thread.
One paycheck from losing it all.
It’s all fun and games until shit starts to burn and elites start getting attacked.
November 11th, 2008 at 6:51 pm
I’m not sure why the rest of the USA can’t go the way of Detroit and Ohio. Detroit and Ohio lost manufacturing jobs overseas, over the course of 20+ years. Well, we’ve been shipping white-collar jobs overseas for the past 12 years. As goes Detroit, so goes the nation?
November 11th, 2008 at 6:59 pm
I’d like to think my last comment was downright nutty. Please tell me why I’m wrong.
If the rest of the country continues “sending good money after bad” in failed businesses (e.g., GM, F), it seems we’re just continuing to dig the hole we’re in already.
Oh, regarding sentiment, 7-in-10 Americans think Obama’s team will turn the economy around. Although I voted for him (because he is “the more competent socialist”), I don’t think he’s going to do much (especially not by continuing the batty policies already put in motion). So, there’s an “opportunity” here for hopes to be dashed next year. Perhaps that will mean “another leg down”.
November 11th, 2008 at 7:30 pm
I don’t know if L or V shaped recession, but oil won’t be cheap for long. Nothing to do with peak oil or demand but political instability in the offing.
November 11th, 2008 at 7:34 pm
I’ve had 3 different friends in the past week ask me my advice “now that the worst is over” whether I think this is a good time for them to go into the market and buy Apple. To me, this tells me that we are a long way from the bottom. The average person who isn’t paying much attention, unless they have been directly affected, thinks it was just a temporary bump in the road.
What is it with everybody’s fascination with Apple anyway?
November 11th, 2008 at 7:43 pm
http://www.youtube.com/watch?v=KUBVTVLKf9g
November 11th, 2008 at 7:45 pm
Ole swinging Richard is already flaccid and is too stupid to know it. He will realize he has also lost his manhood the next time he tries to use it.
This bailout nation stuff is totally out of control. Whatever happen to the cleansing effect of the business cycle?