I guess we need another bailout

Woke up to find the Dow down over 500 points, under 10,000 for the first time in four years.  Maybe we should just buy Dow Jones, and jigger the index?


  1. 2

    Spit in the Ocean spews:

    Maybe Liberals and Cons ought to get together and start to hold the Masters of the Universe accountable for their actions .
    Politicians with their pockets and cheeks full of campaign cash from the very entities that have profited for years from this debacle .
    At least in the last depression these bankster gangsters had the honor to start jumping out of windows .

  2. 3

    ArtFart spews:

    I wonder how many of the computer systems involved in running the stock exchange say “Diebold” on them…

  3. 4

    michael spews:

    But, but, but I got an email from Norm Dicks saying he voted for the bailout so this wouldn’t happen…

    Obama’s up by 5 in New Mexico and New Hampshire and up by 9 in PA.

    Sorry righties, McCain’s done.

  4. 5

    rhp6033 spews:

    McCain was desperatly hoping that the passage of the bailout bill would work, so the bade ecomic headlines would dissapear long enough for him to change the subjet.

    Today Palin’s trying to say that Obama has “ties to terrorists”, for goodness sakes! But that story’s not going to get much traction as people see their 401(k)’s dissapear before their eyes. And then they will remember that it was the Republican party that wanted them to turn over the future of their Social Security payments to Wall Street, also!

  5. 7

    SeattleJew spews:

    10,000 may mean opportunity. The question is opportunity for whom?

    Unless you need cash now, falling stock prices are not, of themselves, a bad thing. Wait a few months or years, the prices will return. So if you can wait, these are good times. But who can wait? The answwr may not be the American Middle Class.

    The real value of the stock market is probably at its highest level ever. There are over a billion new consumers in China, India, Brazil, and even Africa who want “stuff.” While there is a food crisis, our global productivity is rife for investments that will feed this ultimate demand. The bottom line? There is unused productive capacity and unmet need.

    So what holds this back, what could dump us into a recession?

    The first answer is classical … people who hoard capital can drive us into a recession. This was the essence of the brilliant ideas of John Stewart Stuart Mill … mercantilism. Capital is only useful, only grows, if it is productively used. If you hoard capital, it evaporates with misuse. This is the danger .. hoarding capital.

    BUT .. who would want to hoard capital? We, the US rich, are the real enemy. are the real enemy. Our economy has run for decades on the dumb ideas called “trickle down.” Corporations measured their success not in terms of market share or productivity but in terms of stock price. The goal was not to increase profits, it was to increase “value.” The priests of Reagan’s odd religion maintained that the desire to have more cash would drive the wealthy to generate jobs for the rest of us.

    That Reaganesque idea never made sense. Even if true, all it meant was that the rich would put their investments into minimum labor cost societies,in effect removing capital from our society in return for short term gains. The Trickle Down Economists argued seductively that since the owners of this capital remained in the US, the effect was to make US capital even more efficient so overall society would (magically) become yet more productive and the US workforce would benefit.

    The huge error in this model is a lack of understanding that English history is not a paradigm for a world economy. Investing money in an English factory, benefited workers and owners. The workers used their wages to buy good, increasing the owner’s wealth. An ideal cycle?

    This problem with this rosy scenario is that is does not deal with globalism and development totalitarianism. Many of the developing nations control their own central banks and capital exchanges. China and Russia have central, state controlled banks. 75% of stocks in their Stock Markets are owned by the Party, the government, or some similar CPC functionary. The Bank of China wants to get rich, but it wants this because, as part of the Communist Party, it wants to benefit ITS nation. What incentive is there for the CPC to work for the benefit of American workers? The only incentive is to create buyers for Chinese products. But why should a Chinese Bank want to use American buyers rather than Chinese ones?

    Where does this all lead? The Dow WILL go up, at least in the near term. The question is who will be buying those shares? One answer is the soverign banks. But, is these new investors are also governments, presumably they will want to optimize their own societies,

    We need an industrial policy. The US must become more able to compete with nationalist economies.

    The alternative is bad.

  6. 8

    Roger Rabbit spews:

    I’m just kicking back and watching all the Republicans get financially wiped out! This is fun! In another month these people will be showing up at my burrow with wheelbarrows full of stock certificates to sell them by the pound like recycling paper! Sure gonna be a lot of empty McMansions and parked Hummers gathering cobwebs! Those of us who dug holes in public parks and eat grass look smart now! Being able to live off the land is a useful skill in times like these!

    I’ve been living off the land for several years now! Under Republican policies, there’s no incentive to work! But to make sure no one works, Republicans also eliminate all the jobs! In fact, they’re eliminating the entire economy! This will ensure that everyone grows long pink ears and a cute cottontail and lives in holes and eats grass! It isn’t so bad once you get used to it! Being a rabbit sure beats working! I’ve sworn off working and I’ll never go back! I’ll never work again! I live like a Republican now! The way things are going, pretty soon all the Republicans will have to live like Republicans too! Six months from now the entire net worth of the U.S.A. won’t buy a six-pack of toilet paper in Safeway! Except there won’t be a Safeway to buy it in!

    Can you say “1929”?

  7. 9

    rhp6033 spews:

    It IS a bit funny, seeing all those Republicans who proclaimed that their wealth was “earned” by them being “harder working”, showing more “initiative”, and being more “intelligent” than everyone else, not comming to the rest of us with hat-in-hand and asking for a bailout.

    But they aren’t really repentent, they are still unwilling to admit that their previoius fortune is often a combination of good luck and a willingness to subvert the common good for their personal benefit. Instead, they tell us how it’s in OUR INTERESTS to restore their fortunes.

  8. 10

    SeattleJew spews:


    Make it funnier .. these same capitalists consider the totalitarian governments of China and Russia to be capitalist! Brazil’s Lula is a “capitalist” who uses a state economy to create Brazilian wealth!

    What was it Kruschev said? or was it Pogo “We have seen the enemy and they are buying us up”?

  9. 11

    blue john spews:

    #7 Great take on the situation. I would love have the conservatives on the board offer their opinion of this. What is right about it, what’s wrong.

  10. 12

    ArtFart spews:

    7 What you’re basically saying is that the centerpiece of “Reaganomics” was to turn the entire economy into one giant Ponzi scheme.

    Not only a really, really dumb idea….but not even an original dumb idea. Despite the right’s campaign to turn him into a god, Reagan appears to have actually been even more thick-headed than the clown who currently sits in the Oval Office.

  11. 13

    ArtFart spews:

    10 There’s really no contradiction there. There’s no Great Divine Principle that says that capitalism must be accompanied by representative democracy–in fact, the United States, through most of its history, has been the exception rather than the rule.

  12. 14

    rhp6033 spews:

    Wow – the bleeding continues, down -535 points as of 10:00 a.m. PDT. I had expected bargain-hunters to step in by now to push the price back up, but maybe stop-loss and margin calls are wiping out any such gains.

    Obama should hit with a very simple add during the last two weeks before the election:

    DJIA performance during the last Democratic President’s eight years in office: +225.37%.

    DJIA performance during the current Republican President’s eight years in office -7.54% (as of 06OCT08 @ 10:00 a.m.).

    To which party will you trust the future of your retirement savings?

  13. 15

    rhp6033 spews:

    Hmmm, no response from the wingnuts yet. Maybe they are hoping for other topics to push this one down on the page. You know, McCain’s campaign strategy for the rest of the month: “Change the subject”.

    Or perhaps they are waiting for the wingnut sites and Faux News to give them their talking points for the day. Since they are so predictable, I’ll give them a head start:

    Republican talking point # 1: “It goes back to the Clinton Administration”.

    I’d give them a pass on this for the first two years of Bush’s administration, but for God’s sake, it’s been almost eight years now. Besides, the DJIA did -0.78% during Bush’s first term, but did far worse, -6.82% during Bush’s SECOND terms. Can you imagine what a “third term” under McCain would be like????

    Republican Talking Point # 2: “The DJIA went down when the Democrat’s took over in Congress two years ago”.

    That’s so ridiculous it’s laughable. With a one-vote majority in the Senate, and the Republican’s aggressive use of the filibuster and veto (or threats thereof) to prevent any Democratic legislation of consequence from being enacted into law, they have had NO power to affect the economy except to the extent the Republicans and the Bush Administration have also desired the legislation.

  14. 16

    GBS spews:

    I wish the Obama campaign would HAMMER home the whole risky Republican idea of privatizing Social Security and placing it’s solvency in the hands of the Wall Street gamblers who ruined the financial health of America’s banking system due little to no oversight.

    Speaking of Wall Street, where are the Ayn Rand, invisible hand of the free market idiots like MTR???

    Yeah, the heat got hot and they ran down to their urine stained beds in their momma’s basement.

    Republicans = Pathetic traitors to America.

  15. 17

    blue john spews:

    Point 2a – Don’t forget the Dems are weak and spineless and won’t risk challenging the NeoCons on anything that is corrupt or against democratic principles because it might threaten their re-election.

  16. 18

    tpn spews:

    Is it possible that the economy is not entirely dependent on the whims of Congress? You mean, there are other factors at work, like the rest of the international economy? That correlation is not causation, a 700bn lesson in logic for the US Taxpayers? I hear speculation in Canadian Loons is looking pretty good…

  17. 19

    Spit in the Ocean spews:

    Hey , wasn’t that Robert Rubin director of Citigroup standing behind Obama the other day.
    Rubin’s banks’ chief investor is Al-Waheed Bin Talal of Saudi Arabia with a 5% share .
    This is a bi partisan problem , not just the rich republicans but schoolteachers state pension plans too .

  18. 20

    blue john spews:

    In looking back on it, Bad Old Carter saw some form of Globalization coming and told the truth, that American will have competition and will have a lower standard of living as we start to share with the world. That got him kicked out. reagan came in, told us that we don’t have to give up anything, we can stay Fat Dumb and Happy(TM) if we just borrow, borrow and borrow and unregulate the economy. We, as a culture, chose the reagan lies, because they were easy and made us feel good. Now the bills are coming due. It’s an american problem, 70% caused by corporate republicans and 30% by spineless democrats who didn’t want to rock the boat.
    Am I wrong? What am I not seeing?

  19. 21

    rhp6033 spews:

    Dang, has the bottom fallen out????

    DJIA down even more, -567.80 as of 11:00 a.m. PDT.

    Are we close to the safety triggers kicking in, and suspending trading for the day?

  20. 22

    ArtFart spews:

    What’s the “invisible hand of the market” doing? Stroking frantically at its invisible pecker.

  21. 23

    blue john spews:

    The DOW is Down 683.13 (6.62%) at 2:20PM ET

    We have safety triggers to suspending trading for the day? Isn’t that regulation and therefore bad?

  22. 25

    blue john spews:

    Since it’s down 689.98 and Marvin’s in the stock market as a day trader, is it still funny to say “Jump Marvin, JUMP!”?

  23. 26

    Don Joe spews:

    @ 18

    Is it possible that the economy is not entirely dependent on the whims of Congress?

    Absolutely. In fact, if you want to look back at a significant triggering event, when the Fed lowered the federal funds rate to 1% back in 2002, that was the latest in a long line of rate cuts that injected loads of liquidity into the system.

    All of those funds went looking for investments, and they wanted safe investments. Enter CDO’s and mortgage-backed securities. The demand for these securities outpaced to rate at which Americans were taking out new mortgages, so, in order to be able to bundle more and more mortgages into derivative securities, lenders started lowering their lending standards.

    Five years later, the default rate on those subprime loans went through the roof, at which point investment houses who were packaging up mortgages into derivative securities stopped buying up the mortgages. And, hence, the present crisis.

    Now, I’ve simplified things a bit. The ratings firms played an important role, and, at the height of the subprime frenzy, investment firms started shortening the put-back terms for defaulted loans (which created a case of moral hazard), but that pretty much covers the mechanics of the causal chain.

    The question is: why did Greenspan and the Fed lower the federal funds rate so incredibly low back in late 2002, early 2003? What was Greenspan trying to accomplish, and what were the circumstances in which he based that decision?

  24. 27

    blue john spews:

    I just noticed. All the conservatives on this board seem to be awfully quiet right now.

  25. 28

    rhp6033 spews:

    When I heard the report this morning, I had to burst out laughing. The guy who’s going to lead the bailout effort is Neal Cash-Carry?????

    It’s just too ironic.

    But it turns out that the guy’s name is Neel Kashkary, another Goldman Sachs alumni (like Paulson, the current Treasury Secty).

    Former Goldman exec to run financial rescue

    I have to confess, his portrait is a little disturbing. Those piercing eyes remind me of something from a movie, but I can’t quite place it.

    Kashkari is an Indian-American, but the official biography on the U.S. Treasury Dept. is a little unclear on whether he was born in the U.S. or is a second-generation American (not that it matters, which makes me wonder why they didn’t clearly state his birthplace).

  26. 30

    rhp6033 spews:

    At 11:50 a.m. PDT, DJIA down 785.24 points, to 9,540.14.

    That means that as of today, the DJIA has lost 9.84% of it’s value over the almost eight years of the Bush administration.

    Unless something really unexpected happens, it looks like it will close in another hour with at least a 600+ point loss. I don’t know what else the Fed and the Treasury Dept. can do today, they don’t have very many arrows in the quiver left. Are margin calls and stop-loss orders leading the charge? If so, will it be worse tomorrow as brokers catch up with the calls to their clients telling them they have to sell NOW?

  27. 31

    Don Joe spews:

    I think I know why Cynical isn’t around. AAPL is currently down over 8% to $88.84. If he bought at $95.50…

  28. 32

    SeattleJew spews:

    @16 GBS

    Speaking of Wall Street, where are the Ayn Rand, invisible hand of the free market idiots like MTR???

    I kind of agree with Rand, BUT there is rock under her rapidly running water that many do not want to see. What happens when YOUR canoe is the leaky one. Should the other Randies let you on their canoes?

    A simplistic idea may be that the invisible hand is working! The value of US capital has fallen because of the end othe era of cheap oil and the growth of industrial competitors more than able to take us on.

    If this is true, those who worship at the Ayn Rand temple need to remember she is not a kind goddess nor is she an American patriot.

    Maybe when Obama is elected, GWB will ask the black guy of he could err ahh move in early before the neighborhood really tanks?

  29. 34

    rhp6033 spews:

    Hmmm, I go to lunch with the market having lost over 700 points, and when I come back at 1:00 p.m. it’s bouncing back and forth on the 10,000 line? I don’t see any news to explain the rapid buying within one hour. Sure, maybe the “bargain hunters” finally kicked in, but the activity stopping around the 10,000 line seems to indicate that somebody is in there buying in order to manipulate the numbers, and keep the closing number for the day above 10,000. If so, they are calling it kindof close, they may not meet their target (the numbers are still changing as the ticker tries to keep up with the last-minute trades).

    Has Paulson’s go-to guy, Kashkari (“Cash-Carry”?) started dumping billions into the market to try to manipulate the election? After all, he doesn’t have to report on what he’s done until well AFTER the election.

  30. 35

    rhp6033 spews:

    As of 11:14 p.m., it closed just below 10,000, at 9,955.50. If there was market manipulation to favor McCain in the Presidential race, they missed their mark. But I’m not sure that’s the final number.

    I’m hoping to see a line graph of the day’s activities, that should be interesting.

  31. 36

    rhp6033 spews:

    Okay, looks like the rally began at 2:45 EDT (11:45 PDT) and continued for the next hour, hitting it’s peak with the DJIA at 10,024 with five minutes to the closing bell. If there was market manipulation, they probably thought they were safe there and the DJIA would still close above 10,000, with a small margin. But in the final five minutes there was a lot of trading, mostly negative, causing the DJIA average to drop back down below 10,000, settling at around 9,555 after some fifteen minutes of counting after the closing bell (there still may be some adjustment). That means the headlines will still read that the DJIA closed below 10,000 for the day.

  32. 37

    rhp6033 spews:

    What’s really beginning to dawn on me is the extent to which Congress may have given the Republican Party the ability to control the stock market over the next month, going into the elections.

    John McCain is desperatly trying to “change the subject”, as his advisors admitted over the weekend. No the Treasury Dept. has 700 billion in taxpayer funds which it can use with virtually no oversight, which can go directly into the market. Sure, it’s not enough to prop up the market indefinately, but it might be enough to keep it out of free-fall until AFTER the election.

  33. 38


    This bailout is just one more example of the indivisible handjob stroking irresponsible CEOs and CFOs with billions so that they can run the American economy even further into the ground. So much for Keynesian economics. If the goal is to stimulate the economy, why not give the money directly to the American taxpayers? We could do twice as much good for the economy by giving half as much money directly to hardworking American taxpayers. A bird in the hand is worth two in the bush administration.

  34. 39

    Don Joe spews:

    @ 38

    So much for Keynesian economics.

    Huh? How do you figure? Haven’t the past 6 years or so essentially disproved the monetarist approach?

  35. 41

    mark spews:

    Even your leader Alec Baldwin realizes the
    financial meltdown lands squarely on democrats
    such as Clinton, Franks, Dodd, and Raines(soon
    to be in jail Raines). Now if Baldwin can
    think it through, what happened to HA tards?

  36. 43

    blue john spews:

    Dow down another 380 points with 15 minutes to go. Come on Marvin, go spend some money, make a rally! The economy depends on you! Put country first!

  37. 44

    blue john spews:

    Dow 4:02PM ET Down 505.84 (5.08%). Will we see it leak out 300-500 points a day for months? The republican ideology of an unfettered, unregulated economy are crashing around us. I hope Marvin and Puddy are proud.