Idiots...

Thursday, September 25, 2008

I only have a few minutes but I just had to throw out a quick comment on Bush's speech last night. Again, I didn't watch it, but I read the text.

I am not going to rehash what got us here or the merits and demerits of the proposals being tossed about. I will however point out something he said that indicates to me that the entire Washington establishment is either woefully ignorant or playing some kind of power game.

"...these are not normal circumstances. The market is not functioning properly."

The market is doing exactly what the market should be doing - punishing bad decisions and risky investments that fail. The market IS functioning properly. The problem is that no one likes the results. But sooner or later you have to reap what you sow. And we've been sowing this debt-fueled, super-leveraged economy for years. I've been blogging about this for...well, as long as I've been blogging.

There is no doubt that without a bailout of some sort we are going to see an unprecedented economic collapse. A whole generation of Americans are going to get a first-hand look at how bad things got during the Great Depression. You may recall that it took the Second World War to pull us out of that depression.

On the other hand, if the bailout put in place contains provisions along the lines of the original proposal - essentially creating a financial emperor that can do whatever he wants (check out this week's Newsweek cover if you don't believe me) - then we will quickly no longer be the United States of America anyway. We will have avoided economic collapse but it will have cost us the very things that make us America.

Remember these times and the decisions that were made. I think it is safe to say that, regardless of what Washington does or does not do in the next few weeks (days?) the impact is going to be felt for years, possibly decades. We are living in an historic time.