[ExI] Sudden outbreak of democracy baffles US pundits

Damien Broderick thespike at satx.rr.com
Sun Oct 12 07:49:21 UTC 2008

At 12:44 AM 10/12/2008 -0500, I url'd:

><http://www.mcclatchydc.com/251/story/53802.html>Private Sector 
>Loans, Not Fannie or Freddie, Triggered Crisis

Barbara Lamar, who knows a great deal more about finance than I do, comments:

<What this piece leaves out is the part the Federal Reserve Bank 
played in all this. That's the key. Arguing over which specific 
lenders are most at fault is a red herring, a straw man, a 
distraction aimed at taking people's attention away from the actual 
cause of the problem.>

Earlier, she'd remarked in regard to a recent piece [Oct 7] by the 
NYT's tame Republican David Brooks:

<Without the kind of manipulation of money and credit by central 
banks we've had over the past four decades, there would be short, 
swift corrections in the market whenever speculation gets out of hand 
in one area or another -- not the prolonged global meltdown we are 
witnessing and will live through for the next several years.

The kind of fuzzy non-thinking evident in the [Brooks] article makes 
me very angry. Like, wow, too much money is under the control of a 
few people. Gee, someone needs to address this. "Easy money severs 
actions from their consequences." - and he blames the *traders* for 
this? Come *on*. Like, God or somebody created all this "easy 
money."  He doesn't even seem to understand that Fannie Mae and 
Freddie Mac were owned by shareholders, not the federal government. 
There's only one reference to central banks in the whole article: "At 
these moments, central bankers and Treasury officials leap in to try 
to make the traders feel better." -- he seems to believe the Fed and 
other central banks were just sitting on their hands and suddenly 
came to life when the *traders* created a crisis. What bullshit!>

Not one to mince words, Barbara.

Damien Broderick

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