After watching Bernanke last night on 60 Minutes, I still believe he has it backwards. He started the interview expressing his thoughts that they first have to stabilize the financial system and then everything will be ok and a recovery will ensue and that once Wall Street is fixed, Main Street will follow. However, it’s Main Street that is the crux of the problem, they have too much debt and that’s leading to the lack of mortgage, credit card, etc… repayments. While the banks were ridiculously leveraged also, the banking system gets ‘fixed’ once consumers start paying their bills again.
With the TALF trying to get banks lending again and other various gov’t steps, the gov’t is trying to put Humpty Dumpty back together again, the Humpty Dumpty that borrowed too much, spent too much and didn’t save enough. On the ‘Stress Test’ that Ben talked about, WFC chairman called the plan “asinine.” Banks led Asian and European stocks higher.
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.