Yesterday they released a documentary titled » Inside the Meltdown. One of the most hair-raising programs I've seen.
Many smart people (and very highly-paid, too) were so enchanted by the glitter that they apparently failed to notice they were undermining the foundations of our economy. (Or maybe they did notice, but didn't care.)
Sad. Tragic. Disturbing.
Speaks volumes about certain parts of our culture and its priorities .. where profit-n-loss usurp right-n-wrong .. and even common sense gets shoved aside .. when there's money to be made. These people give capitalism a bad name.
It wasn't like nobody saw this coming, or didn't try to stop it. The Chairman of the FDIC, Sheila Bair, was one of those waving a red flag far back as 2001 regarding a potential crisis in the subprime market. (That had to be a frustrating experience.)
If you play the video-excerpt posted on THIS page, you'll hear Sheila say (in her own words):
"For years there were bills in congress to try to address 'predatory lending'. They just couldn't get the political momentum to get anything done. And I think that's because everybody was making money. It's very difficult to get the political will in Washington to move when everybody is making a profit."
On THIS page, we read reports of Bernanke telling members of Congress things like, "After today, we won't even discuss the Great Depression, because this is much worse. Nothing like this has ever happened before."
The big day came on Monday September 29, 2008, when the Dow plunged 777 points, its biggest-ever single-day drop .. shortly after the government (suffering from bail-out fatigue) let Lehman Bros fail.
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Absent the recent (unprecedented) level of government intervention, which includes actions such as the nationalizaton of Fannie Mae & Freddie Mac (which is all based on debt, btw), our economy would be flushed down the toilet. It was like watching a horror flick, only real.
The question we're left with » will everything the government has done be enough? The answer » nobody knows. (It's that bad.)
The whole situation reeks of incompetence .. layers of incompetence. (Or worse.) Ever get the feeling the foxes are guarding the henhouse? By 'foxes' I mean people who are too clever for their own good and who possess less-than-honorable intentions. It certainly seems that way when we give incredible sums of money to the very institutions who got us into this mess in the first place.
I mean, if our economic leaders are so smart, and they know so much about the financial world, and financial instruments, and how economies operate .. then how come ...?
Are they ashamed or embarrassed that this economic mess (of historic proportions) occurred on their watch? .. or that they lacked the insight (or foresight) to anticipate the impending economic collapse?? .. even after others had been waving red flags for years??? Doesn't instill much faith in the wisdom or insight of our economic or political leaders, does it?
Seems unlikely that people sitting in board rooms in both New York & Washington (where these decisons were being made at the very highest levels) did not understand what they were doing. Every decision has a risk/reward structure. Even those most basic, such as » "Should I cross the street now, or wait 'til the bus goes by?"
So I tend to believe they were more ruthless than stupid .. especially since they were so close to the action, and poised to profit. We've all sat in meetings where (some kind of) policy decisions are made. So I'm convinced they had a good grasp of the risks, weighed them against the potential rewards, and made their decisons understanding both. (It's scarier for me to think the people running our economy & government were just plain stupid or reckless.)
Whose job is it, anyway, to ensure these kinds of problems don't happen? (Can anyone tell me?) Is there no one with the honor to take responsibility and fall on their professional sword? I would like to see somebody with the huevos to stand up and declare, "It's my job to ensure that something like this never happens again."
While I'm on the subject of posing questions related to our economy .. why isn't Madoff in jail? The money he used to post bail was gotten illegally, and could be used to reimburse those he defrauded (which he already admitted). Many who have committed crimes far less detrimental are sitting in jail right now. He's sitting in his luxury home, which was paid for with money he Made-Off with (illegally).
The feeling I got from watching this documentary is the prevaling mind-set on Wall Street is » it's all about turning a profit .. at any cost .. cuz that's ALL that matter$ .. even if that means running the US economy into the ground. So be it. And that » it's never enough. (Even if you make billion$.)
Regarding things pertaining to the economy, there's a great video series titled » Commanding Heights, which you can also view online. Last year, I checked out this 3-DVD series from my local public library. Subtitled "The Battle for the World Economy". Unlike anything else you've seen.
For more along these lines, here's a Google search preconfigured for the query » subprime mortgage economic paulson bernanke lehman bail federal wall dow