Nancy Pelosi Is Not The Brightest Bulb In The Room - Daily Show Interview With Jon Stewart (Flashback)
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Update - New clips:
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FLASHBACK for election night: Originally written and published in April of 2009
Difficult to pin down her specific stupidity; more of a general sense that she has no idea what happens in the financial markets. This is not light criticism. It's the reason we find ourselves in our current bailout mess. Congressional leaders were steamrolled by Heny Paulson last September because of their immense fear of the unknown. Their knowledge of financial markets and securitization is nonexistent; they made a bit of noise but in the end were easy prey.
If the economy continues to remain flat or even weaken substantially from here, as I believe it will, we could be looking at 11% unemployment around this time next year. Job losses and the bailouts will be the most salient issues to voters in the 2010 cycle and it could be a very dangerous time to be an incumbent.
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Nov 3, 2010 at 12:10 AM
Reader Comments (14)
You're exactly right about financial and economic illiteracy in D.C. Easy prey indeed.
My congressman here in the 2nd District of Indiana, the one who still thinks that TARP is just "loans" and we're gonna get all that money back, only a few weeks ago discovered that there was something called...(wait for it)... a "naked" credit default swap. And you know what? This fellow's so sharp he's figured out that the use of naked CDS might be something kinda like "gambling" (shocking, isn't it?). And golly moses, you know what else? WE'VE BEEN PAYING THEM OUT AT 100 CENTS ON THE DOLLAR! What does genius think we've been bitching about for all these months?
Mind you, that was the whole point of the AIG bailout -- to pay out on things like CDS to firms like Goldman Sachs and Soc. Gen. Also, as I understand it, the TARP bill is written such that derivatives like CDS are SENIOR to debt in the event of a bankruptcy or receivership. (They already were according to bankruptcy law, but still...) And if genius doesn't like his poor ol' constituents paying Goldman Sachs -- not to mention foreigners -- on their credit default swaps, then maybe he shouldn't have voted for that TARP bill. The same TARP bill that you know damn well he didn't read. Just the same, if he didn't like AIG getting bonuses (which he didn't and voted for the 90% tax) then maybe he should have read the damn "stimulus" bill and gotten right on that shit.
I have no idea what Hank Paulson told the "leadership" in that closed-door meeting back in September, but he could have told them almost anything and people like Frank and Pelosi would have fallen for it hook, line and sinker. These jackasses continue to this day to believe that they did a fine, brave thing in voting for that unpopular bailout bill. In their minds they withstood populist anger of their un-informed constituents and did the right thing. They practically saved the world. Some day history will vindicate them... (puke)
The morons should have listened to their constituents. They oughta listen NOW, but they don't.
Someone better listen. But who? The voters or the political class? The richest or the tax man?
And what is to be listened for? Will it be the midnight arrests of a new Stalin? Or the shrieks of tortured steel as our overheated Weimar Printing Presses explode. For what comes silently like nerve gas? Or for an ocean's small swallow of unconcern as an immense ship sinks?
Ask the old Roman question "Who benefits?
Sorry. I felt like going over the top this evening.
Be careful. The crisis hasn't been manufactured in minds inside the District or while sitting at the bar at the Pound and Pence while waiting for the MTA; there was no hook, line or sinker. There should be no doubt that much of the abuse that preceded the Great Default continues in the cleanup and exposure is required; sunlight, disinfectant and all the rest. Unfortunately the interconnectedness necessitated unprecedented action; grossly imperfect and politicized but inescapable.
In absence of intervention the financial landscape might be significantly more ugly. Perhaps not, but as a policy maker, and on behalf of the populace, will you be willing to place that bet? I suspect that in Bloomington there are plenty on the cusp that can't afford a reactionary and knee-jerk reaction; no support for the bankers, damn the torpedoes.
I agree that during the next eighteen month the US may face unemployment in excess of 10%. Are you suggesting that in the fall of 2008 it was possible to exercise an expeditious receivership exclusively for insolvent institutions? The US consumption binge was unsustainable; easy credit, greed and a mediocre policy response has only made it news above the fold (at least until there's still a physical fold to appreciate).
Life is grey. Politics requires negotiation and accommodation. A campaign obliges opposition research. I'm not sure that you appreciate grey, understand accommodation or are willing to withstand the research.
"And what is to be listened for? Will it be the midnight arrests of a new Stalin? Or the shrieks of tortured steel as our overheated Weimar Printing Presses explode. For what comes silently like nerve gas? Or for an ocean's small swallow of unconcern as an immense ship sinks?"
Nice prose. Very nice. Shrieks of tortured steel, indeed.
2) "Are you suggesting that in the fall of 2008 it was possible to exercise an expeditious receivership exclusively for insolvent institutions? "
3) "I'm not sure that you appreciate grey, understand accommodation or are willing to withstand the research. "
Regarding 1) I would make whatever decision made the most sense given all the information available. I would not be easily swayed by arguments of financial armageddon, certainly. I would have voted 'no' on TARP. Though the website did not exist at the time, I argued on other sites at the time for the creation of 7 new banks with the $700 billion.
Regarding 2): I'm saying a receivership could have been created for Citigroup and Bank of America when each came back for their second-helping of bailout pie. This was in late November when Citi first approached Paulson about a second dip and not long after for Bank of America. With AIG I would have negotiated payouts with counterparties.
Regarding 3): You do not even know anything about me so I'm not sure how you can make these comments. Grey is my favorite color, accomodaton is my middle name and I call my dog, research. Laugh if you are inclined, but ludicrous statements on your part deserve similar answers.
This is where you are wrong and too easily swayed. It is exactly this type of fear-mongering that was used to pass TARP. The end of the world scenario is over-played and trite. It will not work here.
Perhaps you should examine why you are so fearful, or is the fear but an act to cover your support of propping up zombie banks?
What many of us have been arguing (and what many experts have been arguing) is that the "too big to fail" / "systemic risk" view is just plain wrong -- not just morally wrong, but factually and conceptually wrong as a practical guide for action. There is no "damn the torpedoes" stuff coming from most of the folks here, certainly not from Daily Bail. We're arguing for "A Path to Federal Bankruptcy" -- a boring, time-tested process that in many cases is already mandated by law. This is "intervention" --it's just not intervention that leaves me with a multi-trillion dollar bill.
In my view, the financial landscape, as you put it, could not be more "ugly." Zombie banks with promises of unlimited taxpayer money is just about the ugliest scenario I can imagine. It's bad for the taxpayer, it's bad for economic recovery, it will be bad for my children, and if they have children it will be a burden for them, too. Mind you, I don't imagine a world without BAC, C, AIG, WFC, etc. as a scary place. And who says they have to disappear? I just want them to change owners so that I don't have to foot the bill to keep the present owners in place. No big deal. This is what happens in bankruptcy. Life goes on. Of course, some bondholders (including some foreign central banks) will be very unhappy. I don't think Main Street really cares. (BTW, the idea that pension funds will be destroyed by bond defaults is WAY overplayed).
Further, those who make the "systemic risk" argument will often cite the problem of CDS and other derivatives. It just so happens that something like 96% of all the CDS in the U.S. are concentrated in the top 4 or 5 banks (you know who you are, Jamie Dimon). As I understand it, the bankruptcy trustee for Lehman simply voided the remaining CDS contracts. In any case, the CDS problem will just have to be dealt with -- not paid out in full. That's the truly sticky area, but we can't get caught up in these crazy doomsday scenarios in which the huge derivatives tsunami wipes out the entire world. There just isn't enough wealth to pay them off if we wanted to. Just like debt, it will have to be liquidated, defaulted, what have you. In macro terms, this just means recognized economic reality -- there have been losses and they must be booked. And they must be booked by those who took the risks.
I don't think there's much about these issues that is "grey." Ben "I slammed the phone once or twice" Bernanke may believe things are grey, but that's just because he is confused (not to mention culpable). Same with Geithner (confused and culpable). I think the public will grow increasingly tired of hearing how much the Feds regret having to screw them over because... you know....it's just so "grey" and complicated. The morality is clear. The economics are clear. And there are good, flexible solutions to the zombie problem that are being ignored right now because some very rich and powerful people will lose their shirts.
Thanks. II felt it was play time. Or was it "the beer kicks in time?"
In simpler words, same message. What vital organ of the world we have known will burst first?
We don't know what we are doing or how to measure it. Or where it will lead. We are pulling loose threads from a sweate with one hand, and hoping. And meanwhile we try to successfully push yarn into the weave with the other hand..
I don't believe any great Cabal controls all, i.e. something like the Illuminati, or Trilateral Commission. Which leads me to suspect that Obama/Geithner is as clueless as I am about what will result from these choices and acts And the Bush/Paulson Fixit Company was too.
True. It's a hope and a prayer. Their public front is built upon false confidence.
There is no cabal. Just a bunch of bureaucrats beholden to Wall Street.
Eloquent stuff as always.
"What many of us have been arguing (and what many experts have been arguing) is that the "too big to fail" / "systemic risk" view is just plain wrong -- not just morally wrong, but factually and conceptually wrong as a practical guide for action. "
One of those experts being Fed Governor Thomas Hoenig who along with Stiglitz and Simon Johnson testified yesterday that "too big to fail" is a farce.
http://dailybail.com/home/fed-prez-hoenig-breaks-from-bernanke-let-insolvent-banks-fai.html
This entire paragraph of your is gold. It deserved to be pulled out.
"In my view, the financial landscape, as you put it, could not be more "ugly." Zombie banks with promises of unlimited taxpayer money is just about the ugliest scenario I can imagine. It's bad for the taxpayer, it's bad for economic recovery, it will be bad for my children, and if they have children it will be a burden for them, too. Mind you, I don't imagine a world without BAC, C, AIG, WFC, etc. as a scary place. And who says they have to disappear? I just want them to change owners so that I don't have to foot the bill to keep the present owners in place. No big deal. This is what happens in bankruptcy. Life goes on. Of course, some bondholders (including some foreign central banks) will be very unhappy. I don't think Main Street really cares. (BTW, the idea that pension funds will be destroyed by bond defaults is WAY overplayed)."
Your comment about bond defaults and pension funds is deadly accurate. This is but another false truth perpetuated by the financial lobby.
The funny thing is, what is she going to do once she can no longer bask in the glow and experience the rapture of not letting go of the hand of the annointed one...
Expect the bar bill to go up, only no military jets to transport the booze anymore.