March 17, 2008

Panic!

So color me worried about this economy thing. Luckily, I have my money tied up in emu ranches, so I'm protected. The rest of you suckers are in trouble. What to do?

Investment bank Bear Stearn just died. JP Morgan just bought it for 2 bucks a share. It was at sixty something last week and 160-something last year. The Fed took on 30 billion dollars in bad debt to help make this fire sale happen. That's you and me getting stuck with the bill.

Is it really the Fed's business to save dumb banks from themselves? Bear Stearns made a lot of money in recent years with really stupid investments, namely bad mortgages. But now when those investment go south, the US taxpayers step in to save their ass. I'm pretty sure when my emu ranch investment goes south, the US taxpayer will not foot the bill. Of course, if I go under, it will not lead to worldwide economic disaster. Normally, I'd say let rich idiots burn. But if the banks fail and the stock market craters, we all get hurt.

What say you, gentle readers? Is it worth if for the Fed to spend large amount of your money to save idiots from themselves? Is it worth it when those idiots could bring us all down if they don't get saved?

2 comments:

Archaeogoddess said...

I'd love it if the Fed were to bail me out, because I could use the money. I'm not broke due to bad investments (well, that depends, is education a bad investment?) but because I'm still not finished with school and I have no job. What I should have done is borrow money like crazy and invest it in emu ranches!

I think we have to bail out the banks, or we are all up sh*t creek without a paddle. I don't LIKE the idea at all, but if I'd invested money with Bear Stearn (with the idea that they'd make sound investments and I'd be retiring with at least SOME money) I'd want my money back and not lose it because the company made horrific investments. Or if a bank goes under, like B of A (god forbid, I DO have money there) I'd like to know that I could get my money out.

Although, at the moment, my mattress sounds like the best place to keep my $1.25.

larry said...

The last time any George Bush said anything true was in 1980 when GHWB said Reagan's economic plan for big tax cuts was "voodoo economics." (You youngsters can look it up on Wikipedia. Maybe it's even on YouTube.) We've been living with it for nearly 30 years.

What is now called 21st-century financial innovation is really just a house of cards built, in large part, on the foundation of greed blessed by Reagan and the subsequent deregulation enacted by Clinton. If any of the cards collapses, it could wipe out emu ranches everywhere. So while no one feels sorry for Bear Stearns (whose initials just happen to be BS), we all will suffer if B of A collapses.