We have a citenzenry deadly infected by a god-like syndrome (“We can do it. Yes we can”) which elected a God-like president (I am the One every body waited for) and a Congress full of Mandarins (Barney, Pilosi, Kennedy, Kerry on the left and their twins on the right).

Nowhere is there any trace of humility and of understanding that complex issues needs not only will but knowledge to be solved.

Every body in charge seems to be perfectly fine with winging it.

I had a conversation with a young educated Obot the other day about the Black Swan of Taleb, and his approach to the financial mess was : Well, there is no model for what we are going thru, and scientists cannot operate without models. So, considering that standing in front of a coming freight train is the worse thing to do, at least going out of the way is better, even if you don’t know if you should go right or left.

Uh????

What about common sense, lessons from the past?

Well he did not think of that…

Typical… Just get out of the way and jump in on direction without looking first if there is not a ravin there… At least you TRIIIIED…

What is your answer to this very difficult issue?

Should the U.S. tax payers use the Swedish model and completely take over the troubled banks and therefore take on all the risk and losses?

Should we buy all their bad assets from them? And eat all the loses?

Should we let some of them fail and take our chances with the systematic risk a la Lehman?

Should we try and help the people with the mortgages and try to prop up the underlying asset value? You will scream that we are rewarding bad behaviour?

Should we eliminate mark-to-market accounting so the banks can just hide their loses?

Easy to be a critic when there is no good answer. Anyone can do that!

Your three points are a bit strange.

“1. his lack of understanding of the issues

2. his lieutenants’ connections to the firms

3. Congressional connections to those firms and payoffs made by Wall Street”

You really believe that the economic minds that work around Obama and that Obama consults have a lack of understanding of the issues? What a joke.

You think that Obama and the Democrats are so connected to the banks that they will do nothing? Another joke!

You are rapidly losing credibility with your meaningless blogs to your financially unsophisticated audience. You may be a big fish in a very small NQ pond, although I am not sure how much of fish you really are, but you are increasingly sounding like another wacky conspiracy nut blinded your hatred of Obama.

Another good essay. I suspect all 3 “why” factors are in play here–Obama relying on the advice of others, many of whom [if not all] have ties and vested interests to and in the very insititutions that need a full housecleaning. Once I heard the “new” accounting rules had been given a high-5, I knew the fix was in.

The narrative guys win, again.

Most of what I read is grim, pointing not to a turnaround but a long, agonizing decline.

Pretty depressing!

Immediate losses are forestalled in hopes that they will be covered or disguised.

We have seen the “bad news” of immediate losses “forestalled” (or deferred) in the case of the government “massaging” (or fudging, or lying about) the monthly job-loss numbers. The Bureau of Labor Statistics is responsible for the figures, and as one analyst notes:

In every single one of its six most recent monthly payroll reports, the BLS has announced massive upward revisions in prior months’ job loss numbers — with five of those even exceeding its own guidelines for the acceptable margin of error (plus or minus 5 percent).

The stock market rallies when the published figures are “not as bad as expected,” and by the time the real figures are published, we’re on to other things. But sooner or later, the public will “wise up” to this tactic, and the BLS will be an acronym standing for something else: Bullsh–!

For more info:

http://marketoracle.co.uk/Article9960.html

In my opinion, Obama does not force the hands of these financial firms for three reasons:

1. his lack of understanding of the issues

2. his lieutenants’ connections to the firms

3. Congressional connections to those firms and payoffs made by Wall Street

Yet, the citizenry has NO realization of any of this. The media have been complicit since their owners also have “connections” and, most importantly, they fear any substantive critiques of Obama’s BAD approach to the economy lest they a) anger Obama and get tossed under that infamous bus, and b) anger their readers who they’ve brainwashed into lovin’ them that Obama all the time.

The public is woefully ignorant about the weight of the toxic assets that are dragging the economy down, and the banks’ efforts to hide those problematic assets. The public is also frighteningly ignorant they’re being set up to PAY — through higher taxes and hyperinflation — for all of Obama’s missteps.

If only every American were required to read Martin Wolf, Roubini, Krugman, and more. Their giddy confidence in Obama would evaporate in a heartbeat, and they’d all be calling their senators and representatives to get the stimulus plan on the right track and to HOLD OFF on that monstrous budget. Sigh.

Well done, Larry. Yes, depressing, but reality checks are in order.

Banking “stress” test:
Ok, now cough.
Alright, bend over.

You’re fine!

Note to “doctor” – stress tests USUALLY look at the heart.

And another commenter (“HOLYMOLEY”) noted that

Stress tests are ususally not given to patients already on life support either. (TARP = Life Support)

The “stress tests” seem like a big farce, particularly since the change in the “mark to market” rules. And they all passed! What a big surprise!