poisonwood's Diaryland Diary

Date: Sept. 19, 2008 . Time: 3:58 p.m.

financial crisis Entry:


financial crisis

Great quote in the WSJ:

The media is turning the news into a presidential video game. "Hurricane Ike" or "Wall Street Meltdown" appears onscreen, and the media boots up Barack Obama and John McCain to see how well they talk the problem. Mostly they are speaking gobbledygook about things they barely understand. Whatever a credit default swap is, I'm against it. The public is left to wonder if they are voting for a commentator in chief or commander in chief.


The current administration is planning a massive bail-out, it seems. My gut reaction was negative, but I really don't know enough to make a judgment. I find it interesting that neither Ob*ama nor McCa*in called for such a thing, which means, in my opinion, that they were de facto not in support or that they and their advisors didn't think of it - or they're too worried about public opinion to propose it. In fact, M and O haven't proposed much of anything as far as I can tell other than "We'll increase regulations so it doesn't happen again." This is fairly in line with M's hands off attitude, but completely at odds with what I've seen of Ob*ama. Maybe he thinks that a few financial institutions going out of business would increase fairness - too bad it affects most of the rest of us as well.

My mean-spirited self would love to see all the irresponsible people reap the benefits of their actions - from the CEOs to the bankers to the people who bought 500K houses they couldn't afford.

How bad are things? I'm not sure. I've been watching the market closely lately, and we end this week at roughly the same level for the Dow as we've been at at the end of every week. If you look at a daily basis, it's fluctuating like crazy. If you look at the weekly close, it's quite steady. Of course, that doesn't account for the midweek bailouts. It seems like bailing of F&F and AIG was a good thing. I've heard enough about the doom and gloom we avoided to believe that. Is it really necessary to have this huge bailout fund? It seems to me there are two options.

1.) Huge bailout and lots of regulation
2.) No bailout, fallout for all of us, and only a little bit of regulation because we all learned our lesson

A stock I've owned for the past 3 years that has done nothing randomly went up about 30% over the last few days, leaving it up 20% overall. Fortunately, I was in at work at a ridiculously early hour this morning, so I sold it immediately. A few hours later, it was down several percentage points. I hate getting up early, but I guess it paid off for once.

3:58 p.m. - Sept. 19, 2008


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