Hey, Jonah, don't let Andrew distract you from your main point: FDR put the "Great" in the "Great Depression". Lots of other places - from Britain to Australia - took a hit in 1929 but, alas, they lacked an FDR to keep it going till the end of the Thirties. That's why in other countries they refer to it as "the Depression", but only in the US is it "Great".
(I'm confident President Obama will be able to bring us the world's first Totally Awesome Depression.)
Your favorite economist and mine offers the best reason to favor a swift solution.
Whenever there is a lot of the taxpayers' money around, politicians are going to find ways to spend it that will increase their chances of getting re-elected by giving goodies to voters.
The longer it takes Congress to pass the bailout bill, the more of those goodies are going to find their way into the legislation. Speed is important, not just to protect the financial markets but to protect the taxpayers from having more of their hard-earned money squandered by politicians.
That's from part II of his discussion. Here's part I.
Larry Kudlow strikes a similar --and not panicky note. First:
Honestly. A clean bill as requested by Treasury man Henry Paulson, along with John McCain’s oversight board, can help fix the credit-crunch problem. It needn’t be this hard.But later:
According to the Paulson plan, distressed assets will be sold by banks through a reverse auction (the low bid wins) to various investment funds, hedgies, private-equity boys, and other banks. And taxpayers will have a strong ownership position in these asset sales. When the assets are worked out over time — as they will be once housing and the economy recover — taxpayers will actually make money on the deal.
It’s these congressional bells and whistles that really trouble me. And they also trouble the stock market. Stocks absolutely roared last Thursday and Friday when they got wind of Paulson’s program. But Monday and Tuesday, as the new details leaked out and various Democratic senators put their ideas on the table, shares plunged big time. What does that tell you?
