I don’t have any data for the period between May 1, 2008 and today, but dollars to donuts (and what’s the difference anyway?) if the declines haven’t continued or even accelerated, I’ll kiss Phil Gramm’s ass on
I can’t begin to pretend to understand the causes of the current economic troubles, but I’m pretty sure that mental recessions and one lone nation of whiners isn’t at the root.
To my way of thinking, a better target might be a gaggle irresponsibly managed financial institutions that led to a culture of unsustainable credit buoyed by the illusion of ever rising real estate values. Set them loose in a nation with a crushing and inflationary national debt because of a stupid, unjustifiable war. Toss in some smart guys with wacky-but-so-very-clever financial instruments based on said real estate valuations. Mix in a toxic dose of failed deregulation. Add a dollop of over-leveraged lenders for good measure. And guess what? The smart guys suddenly discover they’ve lost the crown jewels. They can’t tell what their debt obligations and mortgage-based securities are worth anymore. Nobody can. Not Wendy Gramm. Not even Dr. Phil himself. It’s not collateral if you can’t place a market value on it. If you ain’t got collateral, you ain’t gonna borrow money from the smart guys.
So credit starts to shrivel here and abroad. And markets need credit like cars need oil. It keeps things sliding along with little or no friction.Hey Dr. Phil, you and yours conjured this little mind game of a recession for all of us with your anti-regulation ideology. And, of course, your numbskull trust in the virtue of capital to get it right. Capital intoxicates people and makes them act irrationally. That's why Bear Sterns found itself with $30 of debt for every $1 it held when the fat lady started singing. Now you want to blame us for the mess? The pity is that anybody at all believes you.