This little piece will develop as the news unfold.
- The government has officially declared bureaucrats are smarter than U.S. citizens.
- Some corporations are too big to fail. (Or their investors are just too well connected.)
- Markets will sky rocket (until they fall.)
- New sub-prime loan channels will be opened. (Under the guise of keeping people in their homes.)
- Investment banks will profit enormously from the bail out. (The same monkeys that brought us sub-primes get paid for underwriting the bail out.)
- It will be too painful to let the markets work out true valuations. (See #1 above)
- Credit is the new drug of choice.
- Citizens to be taught there really are no consequences for bad lending practices or borrowing too much.
- Taxpayers rejoice at the new risks they have taken on. (We're guaranteeing 1.2 T, not 200 B.)
- The government will now back $675,000 loans, up from $425,000. I guess these are the poor sub-prime folks duped into signing loans they did not understand?
- 42,000 lobbyists party in the street. Quoted one happy reveller: "It's a wonderous new world for financial lobbyists!" (See Fannie & Freddie: Buying friends in D.C.)
My wife told me this morning that even if a depression occurs, it would be better to let the market work out valuations. Before becoming a full time Mom, she worked in secondary marketing for a regional mortgage company. I trust what she says.