February 20, 2009...4:23 pm

WARNING: Moral Hazard Ahead!

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Surely you knew this sort of nonsense would be coming from the moment President Obama announced his latest “bailout” aimed at individual mortgage holders that are already “underwater” or presently in serious risk of being in foreclosure. First, the entirely expected visceral reaction from Bob Thompson:

A slightly modified version of this animated rant was delivered to the mob traders on the floor of the NSE by CNBC editor Rick Santelli:

Obama’s Press Secretary Robert Gibbs now steps in with a mild dose of reality…

14 Comments

Filed under Economy, Obama Administration

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14 Comments

  • Brent Fullard
    February 20, 2009 at 4:54 pm

    These “mob traders” have deluded themselves into thinking they are the backbone of America….what a joke. What exactly is the “value added” of a mob trader working on the Chicago Mercantile Exchange?

    Answer: Zero

    They and their “open call” trading system are to modern commerce what buggy whips were at the turn of the twentieth century. They could be eliminated by a Dell or Mac computer trading system in a heart beat.

  • redtory
    February 20, 2009 at 5:20 pm

    Quite so. I’ve never understood why the CME continues to exist the way it does. I presume this vestigial remnant of the market must serve some purpose… not sure what, but how else to explain this artifact?

  • CWTF
    February 20, 2009 at 5:23 pm

    I wonder how some will react to GM asking for 6 billion dollars for only 7000 jobs….

  • Eowyn
    February 20, 2009 at 6:06 pm

    Ah, the fear thing.

    To me –

    (And KeVron will shoot me down in flames, no doubt, *grin* My friend, you made a huge difference in my thinking, which I won’t forget. I do wish I can someday share just how.)

    We doubt our own beliefs in what works. And when that happens, therein lies chaos.

    *Looking forward to egregious, or any other kind, of attacks. Not my lookout to protect the truth. Just putting out my own opinion. You’ll have a good chance of answering my arguments, and destroying them, or not.* –

    It is fear that prevents us from seeing things in their proper perspective.

  • Eowyn
    February 20, 2009 at 6:15 pm

    RT,

    It is not productive to dismiss, belittle, or otherwise marginalize anyone with whom you wish to engage in discussion.

    That’s why I decided you were a voice of reason, based on my own explorations, as an avenue of going ahead with “let’s talk, dogma versus dogama.”

    I am staying with you, to that end. I WANT humanity to move forward. But I don’t want to be labeled with specious perceptions. In the past, conversations with some of your posters, namely Ti-Guy, have been overlaid by his assumptions.

    I confess, I’m only someone who is trying to find answers, while having to travel through the filters of the commenters. RedTory, I am seeking answers. Please help.

  • redtory
    February 20, 2009 at 6:16 pm

    Eowyn — At the risk of being completely obvious, let’s turn for inspiration to FDR:

    I am certain that my fellow Americans expect that on my induction into the Presidency I will address them with a candor and a decision which the present situation of our people impel. This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. In every dark hour of our national life a leadership of frankness and vigor has met with that understanding and support of the people themselves which is essential to victory. I am convinced that you will again give that support to leadership in these critical days.

    In such a spirit on my part and on yours we face our common difficulties. They concern, thank God, only material things. Values have shrunken to fantastic levels; taxes have risen; our ability to pay has fallen; government of all kinds is faced by serious curtailment of income; the means of exchange are frozen in the currents of trade; the withered leaves of industrial enterprise lie on every side; farmers find no markets for their produce; the savings of many years in thousands of families are gone.

    More important, a host of unemployed citizens face the grim problem of existence, and an equally great number toil with little return. Only a foolish optimist can deny the dark realities of the moment.

    Yet our distress comes from no failure of substance. We are stricken by no plague of locusts. Compared with the perils which our forefathers conquered because they believed and were not afraid, we have still much to be thankful for. Nature still offers her bounty and human efforts have multiplied it. Plenty is at our doorstep, but a generous use of it languishes in the very sight of the supply. Primarily this is because the rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence, have admitted their failure, and abdicated. Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men.

    True they have tried, but their efforts have been cast in the pattern of an outworn tradition. Faced by failure of credit they have proposed only the lending of more money. Stripped of the lure of profit by which to induce our people to follow their false leadership, they have resorted to exhortations, pleading tearfully for restored confidence. They know only the rules of a generation of self-seekers. They have no vision, and when there is no vision the people perish.

    The money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of the restoration lies in the extent to which we apply social values more noble than mere monetary profit.

    Happiness lies not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort. The joy and moral stimulation of work no longer must be forgotten in the mad chase of evanescent profits. These dark days will be worth all they cost us if they teach us that our true destiny is not to be ministered unto but to minister to ourselves and to our fellow men.

    Recognition of the falsity of material wealth as the standard of success goes hand in hand with the abandonment of the false belief that public office and high political position are to be valued only by the standards of pride of place and personal profit; and there must be an end to a conduct in banking and in business which too often has given to a sacred trust the likeness of callous and selfish wrongdoing. Small wonder that confidence languishes, for it thrives only on honesty, on honor, on the sacredness of obligations, on faithful protection, on unselfish performance; without them it cannot live.

    Restoration calls, however, not for changes in ethics alone. This Nation asks for action, and action now.

    Can I get an “amen” to that?

  • Red Canuck
    February 20, 2009 at 6:46 pm

    Santelli is an incredible wanker. Somehow, he completely misses the irony of bitching about bailouts while standing in a room chocked full of traders. For fuck’s sake…

  • redtory
    February 20, 2009 at 7:04 pm

    RC — I used to have some marginal respect for traders… After all, as someone who fluffs for others as a living how could I not have at least some grudging respect for their profession? But it was based on the foundational presumption they kind of/sort of knew what they were doing… Now however, what little faith I may have had in their purported acumen and financial “expertise” has vanished completely. At this point, I don’t trust anyone involved in banking or investment services. Not that it matters of course… Aside from my pension funds, everything is dealt with on current accounts.

  • Patrick Ross
    February 21, 2009 at 12:31 am

    I don’t know why you pick on Bob Thompson like that.

    He vents his rage for your amusement! I think of it as a public service.

  • redtory
    February 21, 2009 at 3:00 am

    I’m not picking on Bob. I quite enjoy his rants. They’re cathartic.

  • Patrick Ross
    February 21, 2009 at 10:33 am

    Heh. I love the way he takes things that aren’t altogether unreasonable and makes them sound crazy.

    …

    …I wonder if Kevron’s going to try to argue that a school’s priority isn’t in educating children now.

  • RaiulBaztepo
    March 28, 2009 at 4:38 pm

    Hello!
    Very Interesting post! Thank you for such interesting resource!
    PS: Sorry for my bad english, I’v just started to learn this language ;)
    See you!
    Your, Raiul Baztepo


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