McCain really fumbled the Paulson Plan, just about any reasonable response other than Secretary Paulson’s plan would have been better. How about $700 Billion fund to recapitalize our Banks. Buffett set the market price for emergency capital with his investments in Goldman and GE. Why not follow his lead? The current bailout plan does nothing to solve the credit crisis and in all likelihood will only make the problem worse. Imagine Treasury Secretary Dodd with the power to go to liberal judges to “re-set” principal and interest payments on select mortgages. Farfetched, we will see.

All McCain had to do was agree emphatically that we needed to implement a bailout plan and then slow the process down to consider alternatives. A half day of hearings and then a Bill larded up with “sweeteners” – what a disgrace.

Despite the news here, the real story is now in Europe. There are reports that the Germans intend to create a national financial “shield” to protect its finance institutions. If true, it will mean the end of the Euro and in all likelihood the European Union. The fall-out in Europe is one direct unintended consequence of the Paulson Plan. Ackerman and Paulson do not like each other – at all. When Ackerman saw that Paulson was building a shield around Goldman, he pursued a like response.

Ah, the venality of men….

There is a fundamentally healthy economy in America – somewhere underneath all the financial excess and chicanery and all the financial/oil/military/healthcare/developer corruption of local, state and federal politics. It will be a painful and slow process to kill off the metastasising cancerous growths on the economy, but if Americans achieved that, they could embrace a healthier and more productive and more prosperous future.
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McCain and Palin they got a PERFECT instincts

They just have to FOLLOW THEM

The WSJ is a shill for the securities industry, that is why it is called the Wall Street Journal – oh, but I still read it cover to cover every day. I do not spend much time visiting the Leftist sites, but I did follow a bit of the commentary regarding the Paulson Plan. My vehement opposition to this particular effort to alter the course of our economic plight required me to look for allies anywhere I might find them.

Regrettably, the biggest takeaways from visiting the DailyKos, Atrios, Crooks & Liars and the Huffington Post were about what you would expect – Socialism is the answer to failed Capitalism. DialyKos was pointless, the vast majority of the posts and comments discussed that this was the end of “neocapitalism.” One interesting post concerned pension plans and 401Ks – the conclusion being that 401Ks were another way to screw the little guy and that our future retirements should rely solely on Social Security. The essential conclusion I drew from my meandering through the Kossacks – Socialism is our future! and bring it on Barak!

Atrios is posting brief remarks under the title, “Wheeeeeee…” marking each downward turn in the global stock markets with a short gleeful post under this revealing title.

Crooks & Liars linked to a 60 minutes video about Credit Default Swaps. Interesting, that will certainly stir up the populist rage. I did not watch the video, but fairly or unfairly any layman explanation of the CDS market can only shed a very bad light on Wall Street.

Huffington Post links to comments from Bob Barr. Bob is a big bailout critic, but from a libertarian bent. The comments from avowed Leftist comments are all milquetoast. Rahm Emanuel writes at Huffington, but all he could say is that GWB is not FDR?

I did find a link from one of the comment streams to a new blog that I did not know. The blog is called London Banker and I am adding it to my go to sites regarding the crisis – mainly because London Banker’s opinion of the bailout is exactly the same as mine! But then if London Banker’s bio is to be believed, I appreciate his credible reinforcement of my views. Here is the link:

http://londonbanker.blogspot.com/

Finally, we read today that Paulson is going to nominate a 35 year old former Goldman Sachs employee to manage the bailout process. I am certain that Neel Kashkari will work diligently and effectively in his new job. I guess Paulson does not want to take any chances that the bailout capital does not go to saving Goldman Sachs – even with all the apparent perceptions of conflict of interest.

Can someone tell me what they might have seen while doing recon in the liberal sites? I’m too chicken to go there. (Pwok, Pwok.) I’m interested in the comparison. Wonder if they’re railing about it the same way, or if they are perhaps more sanguine about it? I’m not sure what it might tell us, but on the other hand, it could be distinctly revealing….

Jimmy, that’s not actually true: the TED spread went nuts on the 15th/16th, before the bailout was announced, dropped back on the 19th when it was announced, and headed back up after the opposition became clear. So you’re saying the bailout tightened the screws on the credit market two days before it was announced.

that is exactly THE THING you described that we hear for the last year.

Well God forbid but we also hear that foreign enemies are involved and huge terror atrtack or war may follow the meltdown

God forbid

You see what I see? And to think those kids rioting in Seattle a couple of years ago were concerned about Nike sweatshops in Southeast Asia. Globalization? Oh boy, just wait.

Honestly, I hope you are wrong… But then I dropped out of all equities last September when the Alpha fund shut down.

Big-Bada-Boom

I’ve been following the markets since the late 1960’s, and I was a professional equities and commodities analyst for Dow Jones for 9 years. I made a living as a real-time trader for another 14 years. And I have worked on a variety of market software – both CompuTrac and MetaStock.

Paulson is a Wall Street CEO, who has a 3/4 billion conflict of interest sitting in his trust fund. The only crisis around is the half billion or so he’s about to lose.

I suspect that most people would be somewhat lost if I started talking about support levels for the DJIA at about 8K in 2003, or the market making a double top, and being heading for a normal correction since this time last year, trying to build a new support level at around 10K.

What goes up, must come down. And if you try to prop the market up artificially, it’s going to cave in and fall down and smack you in the head. This bailout, which is now 850 billion dollars since it was attached to a piece of legislation that had already passed the house – is a big mistake.

There was NO indication in the market of ANY problem requiring intervention until after the “crisis” was announced. The “liquidity” problem was caused by the bailout being discussed – why should companies sell their bad paper for 20 cents on the dollar, if they could hold on to it for a few weeks, and sell it to the government for 75 cents on the dollar. That is what froze the market.

TWO BANKS FAILED. It’s an economic disaster – we must act! Really? Wow. On a black day in 1987, a little thing called the S&L crisis started. During that crisis SEVEN HUNDRED AND FORTY SEVEN Savings and Loans failed, hundreds more were merged into other companies, and ONE THOUSAND SIX HUNDRED banks failed.

The market reacted to the bailout vote – it dumped on Monday when it was expected to pass, and Bush’s “DOOM DOOM” speech at the market open didn’t help. On Tuesday the market started to rebound after the bailout vote failed the previous evening, IN SPITE OF Bush giving yet another “WE ARE ALL DOOMED” speech telling us how difficult it was going to become to buy a washer and dryer if you didn’t have good credit.

Wednesday, and the market was roller coaster – a new vote on a bailout was in play.

Friday – the market came roaring back hundreds of poiints, on the expectation that this Constitution shredding POS bailout would be defeated again. Once it passed, the market dropped until the close.

I’ve pulled out of stocks, and exchanged US Dollars for Swiss Francs. Let me just suggest that it might be prudent to sell any stock you own before the market drops several thousand points next week BECAUSE of this bailout bill. The world has just had a demonstration that our lawmakers value money over integrity, and that we have the best goverment that money can buy – if you call Pelosi-Dodd-Frank-Reid-Obama-Bush and the rest of that batch of criminals “best”.

If you think I’m full of crap, well, then you might want to at least consider buying a few slightly out of the money puts, about two months out, to cover and insure any long positions you are holding. You might break even if the market really tanks, and you can sell them back a week later, with minimal losses, but you’ll sleep better for having insured things.

My suggestion is that people run, do not walk, to their brokers and at least discuss how they can be safe if everything melts down next week. Maybe switching out of stocks to something that will be safe until the smoke clears? Do it Monday morning, it may be too late by the afternoon. I hope things go OK next week, but I’m seeing money being maneuvered into the biggest hammer I’ve ever seen assembled, and you don’t want your wallet anywhere near a wound-up-tight-as-a-spring 20 Trillion dollar, country-destroying, economic sledge hammer when it drops.

Sometime next week, somewhere – can’t tell where since this is an awfully covert operation – some really BAD BAD things are going to happen to some country’s financial markets. You REALLY don’t want to get caught by that undertow and sucked down into oblivion. Insure long positions if you can’t liquidate them at the open Monday, and BE AFRAID. As I said, I count the equivalent of nearly 20 TRILLION US dollars being assembled and set up as a very big, very leveraged, Big Freaking Hammer just looking for something to smash. This thing can swat any economy on planet earth like a mosquito – with a splat like a big juicy bug hitting your windshield as you cruise down the freeway at 90, uh, 60 miles per hour.

Be cautious with your investments between now and November 6th. Put your money in your wallet, and keep your wallet the HECK away from the stock market for at least the next couple of weeks or so if you can’t afford to lose everything you have invested – because something wicked this way comes. Be afraid, be very, very afraid.

(If you’re just SO certain everything is now going to go straight up – take a little cash out of your wallet and buy options a couple of months out that are a maybe 5% out of the money. Better to lose a little spare change playing options than lose it all buying into a crooked card game that’s being played with a rigged deck…