Obama’s populist rhetoric about ‘Fat Cat’ bankers
Last night on CBS’ 60 Minutes, President Obama attacked Wall Street as “fat cats,” saying he was not elected merely for their sake. Obviously, the President is now keenly aware of how his political capital is being lost due to the bailout program earlier in the year. He is doing some serious damage control. But what does the President plan to do about this? I do not advocate taxing bonuses outright as is being done in the U.K. Taxing bonuses strikes me as a populist move similar to the desire to impose oil company windfall taxes back in 2008 – something no one is talking about now.
But, Marshall Auerback thinks President Obama is all hat and no cattle anyway. In reference to the President’s more stridently populist tone toward Wall Street, he says:
Far easier to resort to cheap populism than actually do something about it. If the President were serious, he would be pointing out that the bankers have been undercutting every effort at reform, and have been paying off Congress to put loopholes into all legislation. If he were genuinely upset, he would be channeling the country’s anger constructively, by calling on the population to take to the streets in mass protests against Wall St., with a view to shutting down the biggest banks and breaking their power once and for all. Of course, the President would never do anything so “irresponsible”. Far better to throw a few bones to the peasants and hope that the appearance of reform pacifies them.
Here is my take.
If you listened to what Obama said before he became President, it is clear he was not running left.
- He never said he would pull out of Afghanistan; he said all along he considered this the just war. And he promised to escalate depending on the circumstances on the ground
- He never promised Universal Health Care; the proposal by Hillary Clinton mandated coverage while his did not.
- He never had progressives surrounding him in his election bid as Matt Taibbi claims.
Don’t be fooled. Those who decry Obama’s policies as ‘socialist’ are doing so for purely political benefit. Are you telling me that Obama is governing in a vastly different way than George W. Bush at the end of his tenure? How exactly would John McCain have been any less socialist? Are you telling me McCain would have bankrupted Citi or BofA? It’s absolute nonsense. I would grant you that McCain would have sought to extend tax cuts for the rich. Otherwise, the cry of socialism is a purely political tactic using Obama’s dip in popularity in order to strip him and his party of any right-leaning independents he may have won in 2008.
The only difference between the established parties is the degree to which they believe in neoclassical laissez-faire economics. The right believes that markets are almost always right and see nearly no reason for government intervention except to lower taxes and promote free markets. The left believes that markets are almost always right too but they see more reason for government intervention in order to protect their traditional base of unions and the working class (think health care reform, taxes on the rich, and the auto bailouts).
However, in practice, those beliefs manifest themselves differently because of the political process and the power of lobbyists. It is what I have termed deregulation as crony capitalism. What the Obama Administration is doing has nothing to do with socialism; those who believe that are either political partisans or those hopelessly misinformed individuals falling prey to political partisans. The present policy is what Dylan Ratigan calls ‘Corporate Communism’ i.e. a pro-business status quo bias which favors incumbent firms over potential entrants, big business over small business, and corporate interests over consumer interests. It is no different than what we saw during the Clinton and George W. Bush Administrations.
Why is Obama favoring big business? Neo-liberalism.
In the 1990s, the so-called Third Way, popularized by Bill Clinton and Tony Blair, changed the fortunes of liberals dramatically. Traditionally, the Democratic and Labour Parties were controlled by unions and working class interests – the so-called left wing. This is one reason Democrats controlled the South until the civil rights movement. But, stagflation seemed to discredit leftish policies. In the U.S., the 1980s ushered in 12 years of Republican Presidency. Labour’s trip into exile was even longer, 18 years.
The Republican’s were stopped only as a result of an unusual combination of Ross Perot’s third-party candidacy and Bill Clinton’s co-opting of large parts of the right’s pro-business anti-regulation, pro-free market platform – so-called Neo-Liberalism. The neo-liberals in America were so successful that Tony Blair adopted the same tactics in creating New Labour and overthrowing the Conservatives in 1997. Junchiro Koizumi copied Blair in moving the LDP away from its base toward neoliberalism, vaulting him into power in 2001. In fact, one could even see Gerhard Schroeder as a neo-liberal who moved Germany’s SPD into power in 1998 – one reason the SPD is now losing voters to Oskar Lafontaine and die Linke (The Left).
So, Marshall is right. Obama has been more interested in sending out a pro-business signal to re-assure business interests and to court independent voters. I believe he has made a political calculation that he can hold his base of support even if he adopts a more center-left positioning because they have nowhere else to go. It’s not like they are going to vote for the Republicans. This has been an effective way to power for left-leaning mainstream parties for at least 15 years.
However, I suspect that the Obama Administration was taken by surprise by how huge post-bailout profits in the banking sector were. He probably also never anticipated the lack of political antennae Wall Street executives showed in paying large bonuses. So, his pro-business emphasis has backfired and he finds himself in a position where he must ratchet up the populist rhetoric – not necessarily to be followed by any concrete actions.
The problem with this calculus is that, in the wake of this major financial crisis, there are lots of voters who want much more fundamental change than Barack Obama has been willing to make. This is true on banker pay, on auditing the Federal Reserve and on protecting American jobs. Words alone are meaningless – one reason populism and protectionism escalate from rhetoric into action.
Source
Obama’s New-Found Populism: All Hat, No Cattle – Marshall Auerback
This was a guest post by Edward Harrison of the site Credit Writedowns
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December 14th, 2009 at 3:36 pm
I agree with how you see, Obama.
The neo-liberal is just another term we will take the money and do your biding, clinton got extremely lucky, yet, he did run a pretty good financial ship, while letting others take the wheel that finally led to major problems.
Obama’s not dumb by any means, yet, he is being viewed by those with money as a person who can be pushed around, and will not do the tough thing.
His path was already set before he arrived, the decision had been made to re-inflate, what was he to do come in the first day and say nope, can’t do.
In the backroom they all fear “social unrest”, all governments thru-out the world did and they all decided to re-inflate at once…………………..understanding what makes the world go round would help a bit better, he’s basically endorsed class warfare, the idiots that created the problem are the idiots that will solve it, that is change no one can believe in, especially you’re average voter.
The expectation was for honesty, oepneness and a government not run by special interests and lobbyists, what we got are more of the same, that is a fact.
I still stand by higher oil prices lead to kablewey.
Unfortunately he may end up like David Dinkins. I spent 400 hours campaigning for him, and his biggest problem imho is his predicessor was a task master, so in comparison he looks extremely weak, and thus he is being eaten by the wolves very slowly.
December 14th, 2009 at 3:44 pm
How in the world can Obama be “caught off guard” by the banksters going back to “business as usual” on Wall Street after the events that led us to this point? Do you really believe that? I just don’t buy it. He gave away the house, farm, kids, and animals to a group of jackals that would sell their grandmothers down the river for a fast buck, and he’s “caught off guard” by their behavior now? Nobody of consequence went to jail or evel lost their jobs and way of life and he’s SURPRISED they’re going back to doing what they do best – raping and pillaging the carcass that was formerly known as the USofA? Sorry, not buying that. If it were W being caught “off guard”, I’d buy it. Not Obama though. This is pure theater. My wife even mentioned it last night and she’s like the ying to my yang with regards to not being a cynical person, but then again, she’s a former theater professional, so this was all too obvious to her too.
December 14th, 2009 at 3:44 pm
Banks are the perfect alliance for the neo liberalism movement. They don’t make anything that pollutes. They don’t consume materials or use much energy. All they make is money which is a commodity that the political class will do just about anything to get its hands on.
So the key is to regulate the real economy to appease the left but to deregulate the financial economy as an appeasement to the right but with the appropriate quid pro quo understandings to pay campaign costs and such.
It all sort of comes together now in a logical (albeit destructive) way. Please someone come forth with a new third party that is at least slightly concerned with welfare of the nation.
December 14th, 2009 at 3:47 pm
@bsneath: They don’t make anything “that pollutes” in a way the sheeple understand but the pollution (read: theft) being spewed from the financialization (read: financial fraud) has done far more damage than any energy pollution and the like.
December 14th, 2009 at 3:54 pm
@Mannwich
They absolutely “pollute” the moral fabric of the nation by legitimizing fraud, corruption, graft and greed.
December 14th, 2009 at 3:58 pm
Washington DC has destroyed the financial markets- with their liqudity.. Was this their way of getting back at shorts, who they, in their mind, (in DC’s MIND) think caused the financial meltdown??
December 14th, 2009 at 4:03 pm
@CTX
Naw, that is just a by product. It was the Federal Reserve’s way of keeping us from going into a Depression. One that would have made the one in the 30s look mild by comparison. Had they not reflated everything in sight, the downward spiral of the economic contractions would have continued until our economy was roughly the size of a black hole.
December 14th, 2009 at 4:06 pm
to bsneath- is that the democrat version or republican?
December 14th, 2009 at 4:11 pm
@bsneath: On that topic of pollution or “externalities”.
http://www.nakedcapitalism.com/2009/12/hosptial-cleaners-are-worth-more-than-bankers-and-quelle-surprise-bankers-destroy-value.html
December 14th, 2009 at 4:16 pm
My version.
The Republicans have wanted to use “tough love”, which is appropriate in normal circumstances, but not so after a financial fraud has removed trillions from the economy.
The Democrats, if they had their druthers, would simply spend and spend and spend our way out of the hole somehow concluding that government jobs are best kind there is.
We could have done a lot worse than Bernanke during the crisis. If anything he should have acted sooner and more aggressively but that is hindsight and also he had to corral cats even to accomplish it when he did.
What is a pity is the crisis is over but no real restructuring is being done to permit a lasting recovery or to avoid another future collapse. Bernanke did his part. It is now up to the rest of the Bozos.
December 14th, 2009 at 4:17 pm
‘something no one is talking about now.’
Ahem, I’ve been talking about taxing the greedy bastards left and right. Perhaps you should say noone is listening, at this moment that may be partly true. If you cut taxes on the wealthy and deregulate for 20 years, you get roughly the mess we are in today. It might take a while but this problem will get solved.
December 14th, 2009 at 4:20 pm
@Mannwich
Great article. I think a number of bankers should switch careers and become hospital cleaners. In fact if I am ever in the hospital I want Blankfein to be the one who has to clean my ass!
December 14th, 2009 at 4:20 pm
@bman: What he means is that anyone who is talking about it is “a nobody”, same with those who were shouting from the rooftops that this crisis was coming back in ’03-’07.
December 14th, 2009 at 4:37 pm
The Obama comments were either b/c his feeling were hurt by the rolling stone article or he took a look a polling numbers! His no action on the banking industry has teed-off the masses and he is just trying to settle them… while continuing to take no action.
Until he draft some actual regs and submits them to congress (start with installing glass steawall again and breaking up the top 4 TBTF) he will continue to kneel and slurp the bankers at their calling… just look how they treated him at today’s meeting, a sign of who is in charge.
December 14th, 2009 at 4:50 pm
@newulm55
It is just political theater.
December 14th, 2009 at 4:58 pm
What a buncha nonsense.
TheBamster is a handpicked drone of Goldman Sucks and the rest of the Tribe.
To give him the benefit of the doubt about what he knew, and when is pure bullshit.
December 14th, 2009 at 5:07 pm
Au contraire mon seigneur flipspiceland, they have listened to the great Won.
Banks: We’ll ‘step up now’
Lucas van Praag, a Goldman Sachs managing director who is the firm’s global head of corporate communications, said: “Coming into this meeting, we are focused on helping our clients to protect and grow their businesses. Clients are at the heart of our business. And whether it is helping a client restructure debt, raise equity [or] make a strategic acquisition, helping a U.S. aircraft manufacturer to finance the export of American-made planes or underwriting Build America bonds so that municipalities can build schools, roads and hospitals, meeting clients’ needs is the role we play in bringing a broad-based economic recovery closer for all Americans.”
http://www.politico.com/news/stories/1209/30552.html
Life is good once more!
December 14th, 2009 at 5:14 pm
The problem with this calculus is that, in the wake of this major financial crisis, there are lots of voters who want much more fundamental change than Barack Obama has been willing to make. — Ed Harrison.
I agree with this formulation. Recessions, foreclosures and unemployment changes everything. In the 2004-2005 bubble (for example), the underlying problems were all there plain to see, but were not being acutely felt by lots of the right people (ie. those who decide elections). Suffering was perceived as an “outlier” and the m.o. was that if you haven’t made your $$$ yet (or received it through ATM’ing your house), well, you’re just slow to get in on the game.
Another analogy, if you cheat on your wife, she is apt to be less forgiving when you forget to take out the trash.
December 14th, 2009 at 5:18 pm
As Steven Keen has pointed out, Obama received incorrect advice that bailing out the banks would restore Main Street – on the incorrect notion that money to banks would see a multiplier effect. Of course, it only has that effect if people borrow. They aren’t.
The government has still not learned what has been pointed out on blogs for at least two years: the Fed can print, but they cannot control where that money goes.
Obama is lashing out to cover this failure but, apparently, the penny has not yet dropped for him. It is not the banks; it is not the public – it is his advisors who got the program wrong.
December 14th, 2009 at 5:26 pm
It’s cognitive capture by the banksters at the highest level (Summers, Geithner).
BO listened to the wrong people. Volcker should have his ear. Summers should be writing a book on the Cape. Geithner should be sending resumes to PIMCO.
December 14th, 2009 at 5:39 pm
Nice analysis until “…there are lots of voters who want much more fundamental change than Barack Obama has been willing to make…” because some of those change-wanters want more intervention, the rest don’t.
When faced with actual policy prescriptions change-wanters run and hide under their mother’s skirts (the “Parties.”) Then the political/marketers toss rhetorical bones (like hate-crimes to the Left or kooky judges to the bench on the Right) at them like monkeys in the zoo.
The difference Clinton identified and changed politics with is that the Democrats are big-center/small-fringe, the GOP is small-center/big-fringe.
Obama is a technocrat, not a Socialist. And technocrats know how to market.
December 14th, 2009 at 6:44 pm
Obama = Charlie Brown . . . . wishy-washy
December 14th, 2009 at 7:31 pm
“..President Obama is all hat and no cattle anyway..”
I think saying that 44 is “all Fedora, and no ho’s” might be a better fit, regionally speaking..
needless to say, “Velvet Jones” has, more than, a thing or two to teach Pres. ‘Joe Cool’..
http://clusty.com/search?input-form=clusty-simple&v%3Asources=webplus&query=Velvet+Jones+Eddie+Murphy
December 14th, 2009 at 7:34 pm
Best analysis of Obama I’ve read recently.
December 14th, 2009 at 7:48 pm
Sad to Say…think Obama is “All Hat (Rhetoric) and “No Cattle” (nothing there but guile and hyperbole)…but those of us who voted for him against a “Corrupt System” are not giving up. He might be an “empty suit” but that doesn’t mean that the REST OF US ARE. He need to WAKE UP and PUT UP or he’s a ONE TERMER…and we will NEVER FORGET..this BETRAYAL.
December 14th, 2009 at 8:30 pm
The next time we elect a president maybe it would be wise to ask he took Econ 101 in college.
December 14th, 2009 at 9:09 pm
Great analysis BR. The best I’ve seen.
Anyone with a brain can see that he’s done what he can to maintain the influence of the US financial institutions. I would have been great if he could have broken up the banks in the name of the long term financial health of our country but the conditions and his perspective on what would be more effective to handle those conditions lead him in the other direction.
If NOT and it’s all a great BETRAYAL then… my bad, I’m wrong and we’re screwed. Shoot, even if I’m right we’re probably screwed. But this mess was decades in the making and more severe than any this country has ever seen, it ain’t gonna be fixed in a year.
Auerback…
“If the President were serious, he would be pointing out that the bankers have been undercutting every effort at reform, and have been paying off Congress to put loopholes into all legislation.”
Obama on 60…
“And what’s most frustrating me right now is you’ve got these same banks who benefited from taxpayer assistance who are fighting tooth and nail with their lobbyists up on Capitol Hill fighting against financial regulatory reform. ”
Maybe not the indictment of congress he wants but in what reality would he bludgeon them when he needs them to get major shit done?
All of this is a bit much. I understand the outrage but a lot of it doesn’t seem to take into account reality.
“If he were genuinely upset, he would be channeling the country’s anger constructively, by calling on the population to take to the streets in mass protests against Wall St., with a view to shutting down the biggest banks and breaking their power once and for all.”
Gimme a break. This powdered wig fantasy stuff takes away from the discussion of ideas.
I’m sure I’m about to get savaged in here. I welcome it from those here whose intelligence I’ve relied on in the past, you make me smarter. Those of you who will do so with the delusion that you are smarter than the President and you or your political pony would have done a better job under the circumstances, you make me laugh.
December 14th, 2009 at 9:13 pm
EAR,
w/this: “…when he needs them to get major shit done?”
what, major s*** does he have to ‘get done’?
December 14th, 2009 at 9:15 pm
I meant “Great guest analysis BR.”
December 14th, 2009 at 9:17 pm
MEH,
He can’t rattle their cages while they’re in there finishing up healthcare “reform”
It’s in the last act, he can’t start heckling them now.
December 14th, 2009 at 9:27 pm
EAR,
“reform”, yes, no kidding, can’t have 44 disturb the ‘pigs, back at that troft’, now, can we..
that might be “Change”.
We’re so full of excuses, It’s, little, wonder why the AMC is disappearing..
Serf on, McDuff!~
(American Middle Class)
December 14th, 2009 at 9:34 pm
our votes are as nothing compared to the might of the corporate lobby and their marketing machine, not enough people read these days for real change to occur. we are like addicts who are steadily heading down this path, but must reach rock bottom before we can get better. withdrawal will be painful. it’ll take a while but there’ll be some blood spilled.
December 14th, 2009 at 9:36 pm
By the time the Olympics rolled around, Bush had already checked out on us. It was all Paulson and Bernanke after that, except for that final odd speech in September which really only served to alert J6P that things were fuckered.
Obama had a moment, in the first weeks of his administration, to roll up the banksters. He failed to make any worthwhile use of the crisis. He disappointed us so badly when it became clear he was just another tool, he’s lacked the moral authority to accomplish nearly anything else.
This is why he’s one and done, unless he can really pull one out of the hat.
December 14th, 2009 at 9:40 pm
MEH,
What do we do about the pigs? The vote out the incumbent movement sounds like spite in spite of what may result. Who will replace them? More of the same mostly. It’s a human nature thing. Those in the upper realms of the political and financial worlds are hand in hand in their spite of the AMC and anyone else who isn’t a “member”.
December 14th, 2009 at 10:10 pm
“Obama’s not dumb by any means, yet, he is being viewed by those with money as a person who can be pushed around, and will not do the tough thing.”
I gave the maximum donation to Obama and am still happy he is president (especially in contrast to GWB) but I think the above statement is mainly true. I can’t see anything in Obama’s background that would make him knowledgeable about Wall Street issues. He is relying on Geithner and Summers who are highly compromised figures. I’m a lawyer and I wish he had a little a little more of the moxie that comes from running cases, ie that he seemed better to understand that the other guy is trying to win, and to do so needs to screw you and you have to play for keeps.
December 14th, 2009 at 10:16 pm
Click here for an excellent view of the status of the AMC.
http://www.tri-statelugnuts.org/images/membercars/cars015.jpg
December 14th, 2009 at 10:26 pm
Depends how you define “Progressive”? As a measure of how much everything has changed, Tall Paul would be one who comes to mind? If only he could be appointed as Treasury Secretary!!
December 14th, 2009 at 10:36 pm
EAR,
no doubt, it’s why we need to remember the 9th & 10th Amendments..
http://topics.law.cornell.edu/constitution/billofrights
and, maybe, come to understand that: ‘the next Revolution, is the Evolution to Devolution’
or, IOW, we need to wean ourselves from the Federal Teat, and Grow-Up.
too much power has centralized in D.C., it needs to devolve to the States–you know, be a Republic, as we, once, were.
and, as you know, those ‘pigs’ are bred, much like the ‘pork’ fattening in farmyards, by the system that system that grants them succor..
people would do well if they decided to ‘empty the troft’, if, of course, they are, indeed, tired of being, mere, Serfs/’Conned-Mooers’, instead of Citizens..
or, we can live with: “our votes are as nothing compared to the might of the corporate lobby and their marketing machine, not enough people read these days for real change to occur. we are like addicts who are steadily heading down this path, but must reach rock bottom before we can get better. withdrawal will be painful. it’ll take a while but there’ll be some blood spilled.”-red_pill, above
whether there’s ‘blood spilled’, or not, is immaterial, change, compared to ‘what we’re used to’, is here/coming..the addiction metaphor is apt. We can either ‘dry out’, or, continue, to be ‘hung out to dry.’, it, as always, is our choice.
To ‘think’ that one man/woman, or 535, whether the O-One, RPaul, or Chr*st, himself, can do for us, what we choose not to do for ourselves, is the height of delusion..
and, in keeping with the Season, “If only We had eyes to see..”
http://www.mgr.org/EyesToSee.html
December 14th, 2009 at 10:59 pm
Same ole bullshit, different keister spewing it. I just hope this realization sets everyone up to have a viable third party option in the near future instead of the old guard system that is a proven incubator of corruption and ineptitude.
We’re gonna be a third world country of poor unfed masses as the banks use all that capital to “shore up the financial system” ie, line their own pockets and assure the failure of the mega elite does not occur.
As much money as they are throwing around, it doesn’t seem to be making life any easier for us little folks. See:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aBYSp0.XfXZs
Bifurcated reflation anybody?
And the world turns and the beat goes on. I’m starting to hope that 2012 Doomsday theory is true.
December 14th, 2009 at 11:17 pm
MEH,
Pardon the simplification…
The right says “smaller gov’t”… “starve the beast”… lower taxes aka don’t distribute a portion of what I earn to “others” (under the assumption that the “others” are unwilling or unable to provide for themselves and that they themselves have truly “earned” anything). Reward those who have succeeded in taking advantage of the opportunity inherent in being an American.
The left says gov’t is the answer when citizens fail themselves or one another. Step in, provide, make the free for all fair, balance the scales. Make sure it appears as if everyone has the chance to take advantage of the opportunity inherent in being an American.
The constitution was written for a country that traveled its subsequent path of “freedom” on the skeletons of millions of workers of the lowest possible wage.
These are concepts, concocted by the human mind. But like all such concoctions they will never be what they are meant to be because humans must apply them, carry them out. There is no final, pristine product, there never will be.
Humans aren’t capable of capitalism as they define it, they aren’t capable of socialism as they define it, of anything they define. Only something that resembles it after they’ve wielded it however they could, to whatever effect their political or financial position in society allows.
Which brings us to now. Pardon the simplification, but we’re about to find out what America does when it finds out all of that crap they came to “value” as Americans ain’t comin’ back. How will they respond to this concept? What will they wield?
I have no expectations beyond what I anticipate I will do, whether it be exceptional or routine. That is all I truly have.
December 14th, 2009 at 11:34 pm
Same ole bullshit, different keister spewing it.
That’s very unscientific. You can get the same apparent results from two different states. Think high tide and low tide. Or sunset and sunrise. In a camera snapshot, they are indistinguishable.
December 14th, 2009 at 11:46 pm
Bifurcated reflation anybody?
Oh but not to worry. They will balance the budget with a new value added tax that will be applied on top of the higher prices that are paid for basic necessities. But this will keep income taxes low and that will create jobs. (Not going to end well)
I wonder what the chances are that we are creating our own disaffected youth problem just like what has happened in the Middle East. A decade from now might be very interesting.
December 14th, 2009 at 11:54 pm
Since 2006, Barry has been insistent on real estate values being too high in relation to the real ability of homeowners to pay. The first “tell” for me with the Obama administration was a) a stated effort to keep them high and b) opposition or nonchalant (lack 0f ) support to force cramdowns to push at-risk mortgages into payable realms, given the recession pressures. This was a bet made at the gambling table. Keep the bubble inflated, or steer its deflation back down in a way so as to cause the least damage. The latest “financial reform” bill passed by the House killed cramdowns. By not passing them, the can gets kicked down the road until the next wave of foreclosures occurs. And then gets kicked again. Last fall and winter was a tipping point and it was missed, in my opinion.
December 15th, 2009 at 12:11 am
Douglass Watts, I would beg to differ. . . you are claiming the states are different. The measured states in the examples which you cite are similar points of inflection in an oscillating system. These points may or may not look the same dependent upon perspective of the measuring apparatus (in this case your eyes). It is a poor analogy to politics IMO.
A better analogy would be two different systems achieving the same result, such as say purifying water via distillation vs. purifying water via reverse osmosis. The end result is the same, the mechanisms and system used to arrive there are different. Hence, my statement (admittedly a nonscientific one, as I was using a colloquialism, not claiming a scientific theory) is in fact stating that we are getting the same result from the current administration of one party that we would have gotten from the other party. In the end, the regular working stiff is gonna get screwed over no matter which party is in office.
December 15th, 2009 at 12:24 am
I don’t get why people are decrying Obama’s financial policies as socialist. Isn’t the problem that they aren’t socialist enough? If he adopted the Swedish system, which is the right thing to do imo, THEN I could understand people crying about him being a socialist. Until then, it makes no sense to me. Am I missing something?
December 15th, 2009 at 9:14 am
History has no degrees of freedom, but I believe if we’d done the Swedish Solution, it would’ve been quick and painful but this would all be over. An IMF study – led by the US – of 38 different financial crises showed that it, or a variant of it, had the highest “success rate” (you have to look at the fine print for the definition of “success”) and the lowest cost of all the alternatives.
The only counterargument I ever heard was that the US banking system is too big for history to apply. Maybe there are better arguments against it, but certainly no one brought them up at the time.
December 15th, 2009 at 10:01 am
DiggidyDan Says: Bifurcated reflation anybody?
One month does not trend make, but it certainly points in the direction of commodity inflation coupled with real wage deflation. Not good.
Producer Prices in U.S. Climbed More Than Forecast (Update2)
http://www.bloomberg.com/apps/news?pid=20601087&sid=aaL4qCCNdhAQ&pos=2
December 15th, 2009 at 8:29 pm
http://www.ritholtz.com/blog/2009/04/top-10-things-the-letters-gm-stands-for/#comment-159166
Once again, the original Bifurcated Reflation post. . . it’s been quite a bit longer than a month!
http://quotes.ino.com/chart/?s=NYBOT_DX
Now what can hold the demand still? Look again and judge for yourself.