Monday, December 1, 2008


The whole "Obama Announces Something At Press Conference, Stock Market Goes Up" theory died a painful, painful death today as the Dow tanked 680 points, or 7.7% or so. NASDAQ and S&P 500 were down even harder, almost nine percent a piece.

Daily occurrences of almost ten percent swings in a major stock market for a six week period are generally signs of a mortally wounded financial system.

A Necessary "What If" Scenario

If both America's record on terrorist intelligence and its reaction to that intelligence was more reasoned and swift in the 21st century than degenerating into a reactionary political excuse to attack the enemy we wanted to see responsible, would India (the world's largest democracy) have taken US October warnings about Mumbai being attacked from the sea a tad more seriously instead of using Mumbai as a reactionary political excuse to attack the country they want to see responsible?

Just asking.

Fresh From The Duh-Partment Of Economics

We've apparently been in a recession since December '07.

I'm sure this is news to you.

Epic Irony Detector Fail

After eight years of Bush's unlimited "unitary executive in a time of war", Nameless One's extra-constitutional Fourthbranch antics making him accountable to no one, and Sarah Palin being unable to describe the duties of the Vice-President job she was running for as the GOP standard-bearers on the limits (or complete lack of them) of executive branch power, we have Palin herself making this comment today campaigning for Saxby Chambliss in Georgia:
"We need Saxby because we need checks and balances in Washington, and we will not have that if Saxby is not re-elected," said Palin. "With one party in control of the House and the Senate and the White House we need a conservative who will speak for themselves."
Is there any more reason why the GOP can never be allowed in power again? The GOP was never, ever interested in checks and balances when it was in fact how can we forget the promises of a permanent Republican majority in Washington?

But now of course we need to restrain the Democrats before they do anything.



Atrios on January:
My guess is that in early January the Republicans will make some pleasant sounding noises about how they're looking forward to working with the new president, blah blah blah, and then there will be some fake controversy or Cabinet nominee who just "crosses the line," and then in more sorrow than anger they'll proceed to burn everything down.
My guess is that Cabinet nominee will be Obama's pick for UN Ambassador, Susan Rice. She's by far the most leftward of Obama's picks so far, and if the Weekly Standard is already complaining about her today, come January she becomes payback for the Left's treatment of John Bolton.

I'm with Duncan on this one. Mark it down.

Zandar's Thought Of The Day

Corporate PR For Dummies:

When one has just solicited $20 billion from the American taxpayer after announcing staggering layoffs of 53,000 or so, one should not then turn around and pay $10 billion for a Spanish highway construction company.

Credit Card Catastrophe

If the credit card article I referenced in this morning's StupidiNews is accurate, we're in a colossal amount of trouble financially.
The U.S. credit-card industry may pull back well over $2 trillion of lines over the next 18 months due to risk aversion and regulatory changes, leading to sharp declines in consumer spending, prominent banking analyst Meredith Whitney said.

The credit card is the second key source of consumer liquidity, the first being jobs, the Oppenheimer & Co analyst noted.

"In other words, we expect available consumer liquidity in the form or credit-card lines to decline by 45 percent."

That would take out $2 trillion in consumer spending power, despite the fact that interest rates have once again hit the Greenspan line and will almost certainly be under that come next year.

In other words, the $700 billion stimulus package Obama and the Democrats are planning won't be nearly big enough when the credit card companies are taking almost three times that back out of consumer hands.

That package too will fail. So what's the problem with credit card companies? Why are they nuking consumer credit lines across the board? Here's a major reason:

Mortgages and credit cards are now dominated by five players who are all pulling back liquidity, making reductions in consumer liquidity seem unavoidable, she said.

"...We are now beginning to see evidence of broad-based declines in overall consumer liquidity."

"In a country that offers hundreds of cereal and soda pop choices, the banking industry has become one that offers very few choices," Whitney wrote in a note dated Nov. 30.

Those five lenders, if you're wondering? JPMorgan Chase, Bank of America, Citibank, Capital One, and HSBC, some of the same financials that are scrambling to stay afloat. Citibank, part of Citigroup, is already in serious trouble. These companies are going to be cutting off credit card lines left and right in order to stay afloat, and the results on our consumer-driven economy will mean devastation when coupled with rising unemployment.

If consumers don't have the jobs and the credit to buy, then our economy shuts down and will stay down for a long, long time. The economic crisis could last well into 2011 or more at this rate, almost certainly turning a bad, bad recession into borderline depression. There continues to be no visible bottom to the economic crisis, no light at the end of the tunnel that isn't the headlights of oncoming train after oncoming train.

It's a sobering thought that 18 months from now, December 2008 will be considered part of the good times for America.


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