New jitters about U.S. financial system
September 14th, 2008 at 08:55pm Pat Cunningham
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I don’t claim to know anything about this stuff other than what I read, but what I’m reading on this Sunday evening is a little unsettling.
There’s THIS about how new “concerns about the stability of the U.S. financial system sparked talk of emergency liquidity measures by the Federal Reserve…”
And THIS about today having been “one of the most extraordinary days in Wall Street’s history” and about “an 11th-hour deal to avert a deepening financial crisis…”
And this headline on the Wall Street Journal Web site:
Crisis on Wall Street as Lehman Totters,
Merrill Seeks Buyer, AIG Hunts for Cash
U.S. Opts to Avoid Lehman Rescue,
Stirring a Momentous Weekend for American Finance;
Traders Brace for a Chaotic Monday
UPDATE: Greenspan SAYS the U.S. is in a “once-in-a-century” financial crisis.
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5 Comments Add your own
1. Henry | September 14th, 2008 at 10:02 pm
This is a result of lax oversight by the regulators. They knew what was going on and let it happen. More taxpayer money is going to be needed to keep the financial system stable. It’s obscene that the executives of Fannie and Freddie who were fired are getting $23 million in severance. Something else to add to the W legacy.
2. swamprat | September 14th, 2008 at 11:01 pm
This is a very complex problem. But it involves everyone from China, our government, realtors, appraisers, and home buyers. George Bush wanted an ownership society. So the government looked the other way as loans were made to people who couldn’t afford them. Now those loans are failing. Those loans were sold off many times to investors. Now the loans are failing. In a free market system let them fail. Taxpayers should not bail them out for their mistakes. If they are bailed out it just postpones the end. It’s just too bad that everyone will now have to suffer.
If you think it doesn’t affect you, your wrong. Many banks are involved in this. When the big boys go down, many banks will go down with them. There is not enough FDIC insurance to cover it all.
We will see how far this will spread, but we are on the abyss and if we tip over the edge it will become a full on economic collapse. Thank you George Bush, Ben Benanke, and Hank Paulson.
3. DingDong | September 15th, 2008 at 2:02 pm
Look up the Glass-Steagall Act of 1933, this would have prevent some of this. Repealed by Clinton in 1999. Enough blame for all.
4. Henry | September 15th, 2008 at 8:33 pm
And W and the Republican controlled congress (for 6 years) didn’t bother to re-instate it. They made drastic changes to the banking laws, why not Glass-Steagall?
5. Billybeermonicagar | September 15th, 2008 at 9:08 pm
What was Henry Waxman doing?
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