Our Opinion: Whistling in the wind
Tuesday, September 16, 2008 11:12 AM PDT
President George Bush’s assurances Monday regarding the American economy sounded good and, perhaps, even brought a measure of confidence to Americans watching the latest Wall Street meltdown closely.
Bush sent the message the government was set to concentrate on the economy “as a whole” and not individual companies such as Lehman Brothers Holdings Inc.
The signal — the government was not going to continue to bail out individual firms that are in trouble because of the real estate market failure — was clear, but its future implications are not so apparent.
The action Monday on the financial markets were disturbing. Lehman Brothers filed for bankruptcy, while Merrill Lynch & Co., Inc. was forced to sell itself to Bank of America.
These two institutions — Lehman Brothers and Merrill Lynch — are not small firms. They are huge, with massive debt and holdings stretching across a wide swath of the American economy.
Their failure is a sober, troubling message for the future.
The Bush administration has made a clear gamble to discontinue to bail out firms such as Lehman Brothers and, in essence, hope the markets stabilize by themselves. Of course, America is securing a huge amount of help from foreign investors to shore up the economy in the wake of the Merrill Lynch and Lehman Brothers meltdowns.
The key question, though, is how long will this type of financial turmoil continue and how much federal regulation is necessary for these markets.
Neither question has an easy answer.
The truth is, America just might be at the mercy of events and history.
Michael Allen wrote on Sep 16, 2008 8:03 PM:
And never forget that the mostly-foreign owners of the private Federal Reserve friggin' despise America.
"The eyes of our citizens are not sufficiently open to the true cause of our distress. They ascribe them to everything but their true cause, the banking system; a system which if it could do good in any form is yet so certain of leading to abuse as to be utterly incompatible with the public safety and prosperity. The Central Bank is an institution of the most deadly hostility existing against the principles and form of our Constitution."
- Thomas Jefferson "