CNBC's Becky Quick is a bailout apologist and believer in Paulson's myth of societal breakdown if TARP hadn't passed (Run For Your Lives!)
Video: Brad Sherman -- Paulson threatened Martial Law
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Paulson Tactics for Bailout Opportunists: Tactic #1 -- Tell the public their ATMs will not work. Paulson, Kanjorski, Bernanke, Bush, Geithner, Pelosi, Reid, Judd Gregg and more have done exactly that. In the media, the list is too long, but now add Becky Quick from CNBC's Squawk Box.
It's pretty weak as political strategies go. Public opinion was 10-to1 against TARP. They should have said no TARP would mean American Idol, and Dancing With the Stars would immediately stop production due to financing difficulties. Problem solved. They wasted weeks with the martial law, ATM talking point.
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Don't Believe the Populist Hype: The Government Bailout Was the Right Thing to Do
By Becky Quick
FORTUNE -- Beware the revisionists. It was bound to happen eventually, but here we are, less than two years after the U.S. faced its worst financial crisis in decades, and a steady stream of politicians routinely take to the airwaves to declare that the government overreacted with the $700 billion TARP plan and ripped off the taxpayer. That the incredible interventions by the Federal Reserve and the Treasury weren't necessary. That we should have taken our lumps and let the chips fall where they may.
Yeah, right. Jimmy Dunne, senior managing principal at investment-banking firm Sandler O'Neill, summed up my feelings perfectly when I asked him recently what he thought of those politicians: "They're idiots," he said.
Dunne is one of many who watched the meltdown from a courtside seat. "You had to be at your desk every day, but there was just this feeling of hopelessness, like there was nothing you could do," he says of those dark days in the fall of 2008.
"You just had this feeling in your stomach that if the government didn't stand up and say, 'We will be there,' the whole thing would be crumbling down."
Why would things crumble? Because our financial system is one that operates on the idea of faith. Faith that institutions will back their promises, that people will pay their bills. And this nation went through a period where everyone questioned that faith. Institution after institution came right up to the edge of collapse -- and some plunged off: The most frequently asked question on Wall Street back then was: Who's next? And in that environment, everything shuts down.
- "It's like going to a party and being told 10 out of the 40 people there have a contagious disease," says Dunne. "You don't know which 10. Are you going to shake anybody's hand?"
That's why the government had to step in and take such extraordinary steps, from backing the credit markets to insuring money market investments to raising the FDIC's deposit insurance to $250,000 per bank account. Combined, those moves helped stop the run on the banks and kept the panic from spreading.
Those who think the financial system's collapse would have hurt only Wall Street fat cats are fools -- or terribly naive. When major companies can't get funding, they can't meet their payroll obligations. Some major companies including a few Dow components -- might have fallen into that camp back in the autumn of 2008 when the credit markets seized up, leaving hundreds of thousands of employees without a paycheck. It would have immediately trickled down to smaller companies across the country.
Unemployment, which is dogging our nation right now with an official rate just under 10%, could have easily risen to 25% and beyond, just like during the Great Depression. Plus, think of the disruption that would have played out if the banks had frozen up. During the height of the crisis, we were joined on the Squawk Box set by a guest host whose firm now manages over $1 trillion in assets.
During one commercial break, he confessed that he had recently told his wife to go to the bank and take out as much money as possible, because he wasn't sure the ATMs would be working the next day. In fact, the smartest people I know, the ones with the most intimate knowledge of what was happening in the markets, all thought things were even more dire than government officials were letting on at that point.
The armchair-quarterback lawmakers and candidates who are now second-guessing these moves are dangerous. Not only are they playing on populist anger to advance their own needs (getting elected), but they also threaten to undermine those very necessary and positive steps that were taken by the government during our darkest hours. That, in turn, could prevent future leaders from doing the right thing the next time around. And though Congress was poised to pass a financial regulatory reform bill as Fortune went to press, you can bet that somewhere down the road, there will be a next time.
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Watch these clips:
Brad Sherman. Martial law. Bailout art.
Sep 9, 2010 at 6:05 PM
Reader Comments (23)
Second, Ben Bernanke said Bear Stearns was too big to fail in 3/08 (back then it was "too interconnected") and had to be bailed out as a result. Then, six months later, Lehman--which was a lot bigger than BSC--was allowed to fail. Lehman's collapse caused what, one or two other small funds to fail? But again, no martial law.
The fact is that banking minions are dupes who are too stupid to realize that there is ZERO evidence of what would have happened. All they can point to is the groundless speculation of bankers and apologists. FAIL.
You know I was just thinking what a great job the blogosphere did smacking down the "TARP is profitable" crowd. Standing up and saying "We're making money on TARP" quickly became the equivalent of getting "idiot" tatooed across your forehead.
I was so proud of you guys....
Now we've got Warren Buffet's lap dancer lecturing us on the virtues of pretending that GE isn't insolvent and calling us idiots by way of some douche no one's ever heard of (check it out - Wikipedia lists four Jimmy Dunnes; think this schmuck is one of them?).
TARP did help keep Becky out of the bread line (for a little bit anyway), so that explains that. But if Becky wants a real journalist challenge why doesn't she explain how GE is ever gonna get out of the half-Trillion (that's right 500 Billion) dollar hole they're in.
Inquiring minds want to know, Beck...
(and an occasional "thank you" to the taxpayer wouldn't hurt either)
So 2.5+ years ago, I couldn't have walked into a Chicago bar, heard some kool-aid drinking local broadcaster from New York talking about the strength of the recovery and backing it up with bullshit numbers that NO ONE was calling him on, and have proceeded to separate his face from his skulll with a few taps on a blackberry. After that actually happened a few weeks ago, bar staffers listen much more attentively to my frequent tirades.
So yeah, you're right to be proud about the blogs. They've got an organic reach to them, something that the MSM elected to kill a long time ago.
Then she can spend several hours reading all of the various critiques of this paper. And then, if she has half a brain, she can figure out for herself that the Hammer and the Helicopter either a) needlessly pissed their pants, b) are despicable liars, or c) just had no idea what the hell was going on except that a bunch of banksters were calling them up and telling them really scary stuff.
As a bonus, she might figure out that the bunch of craven herd animals who tried -- oh-so- hard -- to write a take-down of this paper, have got NOTHING. NOTHING at all to show for their efforts but a bunch of bleats and baaahs (and pats on the back from each other).
The financial crisis was/is severe, but the panic was in financials. Markets, including commercial paper, adjusted as one would expect them to adjust. There was no credit "freeze". Didn't happen. And wasn't going to happen. All that happened was that A2-rated companies (relatively risky ones) went from paying c3% to paying c6% -- OH DEAR GOD, the End Times are nigh (snark).
Revisionists my foot.
I save my venom for regular folk, kick the shit out of them at least 5 times a week for their fellatious ways with big banks. But they're catching on. Not only are the blogs winning, they're not far from the tipping point.
Richard Daley isn't running for reelection after 21 years as Chicago's mayor. Now, I've been railing about poor fiscal management in Chicago and Illinois for months. I believe your site laid out the pension issues. People rolled their eyes at me but I refused to shut up. Now that Daley's abdicated, those eyes aren't rolled anymore.
Keep up the good fight.
Cheyenne, I'd like to think you're right. Why do you say that?
Revisiting the Scene of the Crime: Did the Bailouts Save the World Or Just Wall Street Bonuses? »
http://dailybail.com/home/revisiting-the-scene-of-the-crime-did-the-bailouts-save-the.html
Is Kashkari a chump?...
I bought a place in rural Indiana over a year ago, as a hedge. Now the locals humor me, and reveal a lot in the process. They know something is severely fucked up. They just don't know what. But for the first time ever, people there and people in Chicago are way more receptive to hearing that repub-dem and left-right is a puppet show that ends with less cash every time.
What did PJO say? Lose your cab drivers and your hookers, lose your ass. That's what I mean by 'tipping point."
That stirring has many working extremely hard trying to put the "restless" ones back into the separate pens of the two respective herds so that the ping pong game of theft and deception may continue.
Isn't that right Gobie.
Obama uses Bush plan for terror war
Includes tactics he had criticized
By Eli Lake
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The Washington Times
http://www.washingtontimes.com/news/2010/sep/9/obama-uses-bush-plan-for-terror-war/
http://www.youtube.com/watch?v=nIc8QemH8Iw
As the ninth anniversary of the 9/11 attacks approaches, much of President Obama's counterterrorism policies and his understanding of executive power closely hew to the last administration, which he criticized as a candidate for the White House.
There was much of it then Gobie, there were like 13 candidates for POTUS on the ballot nationwide on election day, and more than that in some states. You would have to not vote the party ticket to see it, but then that would require you to make your own decisions wouldn't it.
You will get your wish though (about the party change), and then after a period of time while things stay screwed up the parties will switch again because people get tired of the same lies and bullshit, they always do. But the finger pointing always stays the same.
"I remember the horrible rumors about Palin’s baby, David Letterman making rude comments about her young daughters, and how much the Palin’s had spent on their clothes. I trust that nobody here who believes in the “their all the same” mentality contributed to that hate-filled nonsense. "
I have always believed that family should be left out of politics, but you tend to write a lot of bad stuff about Michelle, the kids, the dog, and other family members don't you. Just a casual observation.
"As the ninth anniversary of the 9/11 attacks approaches, much of President Obama's counterterrorism policies and his understanding of executive power closely hew to the last administration, which he criticized as a candidate for the White House."
Speech writers write the speeches that everyone falls for while campaigning, but the contributors always control what is really going to happen. Politicians do not have their own opinion.
That part never changes for either party.
Everybody knows I voted for Obama and I truly regret it, although I don't regret not voting McCain-Palin. Obama solidified my vote with a single sentence:
"We've gotta stop borrowing from China, to give it to Saudi Arabia".
Hollow words from some speech writer, nothing more. He has accelerated that process.
I'm totally with you about leaving the families out of it, unless they step into the arena (Liz Cheney and Hillary are fair game; Palin and Obama's children are clearly not). I hope as a nation we can transcend partisan thinking - it's like arguing the merits of the Crips vs the Bloods - a fool's game.
It really is like trying to get the animals out of the burning barn, they just won't leave.
why doesn't she talk about trillions in taxpayer guarantees? unimaginable debt born by the taxpayer? destruction of the middle class while Wall St. gets huge bonuses, based largely on gambling with OPM? clawbacks of huge bonus money?
what a world we live in! greed, gluttony, vanity and hubris run rampant...
Nice to have a few different and new voices around here...very well-stated, josie...you sound like ratigan...and that's a compliment...