Six months ago, I compared the nation’s financial crisis to the K-T extinction event which caused the dinosaurs to file for Chapter 7. This naturally led people to reallocate into small, rodent-like mammals, hoping for a big return on investment when they evolved into a race of investment bankers. However, in light of the recent spate of investment bank failures and the deepening crisis, this portfolio no longer seems promising. I would like to change my answer, and say that this is clearly the worst crisis humanity has faced since Carl Lewis tried to become a pop star.
There is no hope. But there is a plan:
The Bush administration sketched out a multi-faceted effort on Friday to confront the worst U.S. financial crisis in decades, outlining a program that could cost taxpayers hundreds of billions of dollars to buy up bad mortgages and other toxic debt. Relief washed over Wall Street with a surge of buying.
President Bush, flanked by Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, acknowledged that the program will put a “significant amount of taxpayers’ money on the line.”
The plan being, I gather, to clog the toilet with taxpayer money to prevent real money from being lost. And how much money are we talking about?
The chairman of the Senate Banking Committee, Chris Dodd, D-Conn., warned on ABC’s “Good Morning America” Friday that the United States could be “days away from a complete meltdown of our financial system” and said Congress would work quickly to prevent that.
Later Dodd told reporters that the government’s rescue plan will be costly, and demanded more details. “We’re anxious to hear the specifics. None of us have any idea what the details are. We understand the gravity of the moment,” he said. predicted the new bailout plan would cost at least half a trillion dollars. […]
The federal government already has pledged more than $600 billion in the past year to bail out, or help bail out, some of the biggest names in American finance.
So we’re planning on breaking the trillion dollar mark this year – $3,000 for every man, woman and child in America, sent to “the biggest names in American finance”. And this is nobody’s fault, and there’s no need for any plan to pay for it. Just one of those trillion dollar “oopsies” that very responsible people sometimes make. Just cover your ears.