The Gospel according to Bernanke and Paulson:
Heed ye these dire warnings. Iffeth thou do not giveth the sum of seven hundred billion US drachmas to your brethren in the financial services industries, whatfor good are ye, oh, congress!
For iffeth thou shall fail to giveth away the money of the taxpayers to the richest men in the world, a terrible plague shall befall both of your houses: those of the House and yeah, that of the Senate as well.
No companies shall be spared the wrath of the vicious economic maelstrom which will surely come iffeth thou do not giveth over the money before the Sabbath, or Friday, or whenever you decide to go into recess, whichsoever of these comes first.
Heed ye these words well and giveth without oversight or conditions and without restraint on the prophets Bernanke and Paulson, for they shall lead us into the desert, and out, and probably back in and out and eventually down a black hole of debt.
These are the words of a pair of Wall Street snake oil salesmen.
That the financial crisis occurs on the week before quadruple-witching (last week) and in the heat of a taut presidential and congressional election is just a little too coincidental in its timing, isn't it?
Am I the only one who smells something fishy here, especially noting that every day the congress delays passage of the "emergency" bailout plan for failed Wall Street banks, stocks slide further still?
Monday was full of drama, and Tuesday was a nice sequel, with the markets tacking on further losses as Bernanke and Paulson testified before congress on the urgent need for $700 billion dollars.
Really! They want it before the week is over, and without deliberation and without the usual markup process and without oversight provisions, and $150 billion - as proposed by Senator Schumer - is not enough, and no cuts to executive pay for companies who participate in the largest single fraud ever perpetrated on the American taxpayer. Right away! The credit markets are frozen, don't you know?
Well, the ordinary American just isn't really buying it. Life keeps going on as normal in most parts of the country. People have ready cash or credit and sure, there's some suffering, but that's always been there. And those foreclosed homes, well, sell them at a discount. Hey, the people who bought them lost. The banks who lent the money, based on bogus appraisals and worthless credit checks, or no credit checks, can stand to lose a few billion.
Besides, weren't these loans all packaged up and re-sold to unwitting investors? Why do the banks and financial institutions have these toxic tranches of mortgage debt on their books. Are they just that stupid? And if they are, they deserve to go down the memory hole. No bailout. Not now, not ever, not on my - and your - dime. No siree!
Wall Street, meanwhile, played the part of the wounded puppy again on Tuesday while lawmakers on both sides of the aisle cast doubt on the program and some Republicans, notably Senators Shelby - who wants alternatives - and Bunning, have expressed outright opposition to the plan. Democratic Senator Christopher Dodd said the plan was "not acceptable."
So, get ready for the greedy self-dealers on Wall Street to send the markets into another dizzying decline. The word is out there. Either give us what we want, or we'll break the system.
Many would love to see them try to tank their own companies because for every unscrupulous, corrupt banker or financier, there's another lurking behind every trade and what once was yours becomes mine, and at a much lower price, thank you very much.
As if the stock market wasn't shaky enough on its own. It doesn't need any extra "help" finding a bottom.
Dow 10,854.17 -161.52; NASDAQ 2,153.34 -25.64; S&P 500 1,188.22 -18.87; NYSE Composite 7,785.27 -133.34
Our market guides were right on target again. Declines led advancers, 4419-1951. New lows surged again past new highs, 286-35.
Oil dipped $2.76, to $106.61 on the November contract. Gold was clipped $17.80, ending at $891.20. Silver also fell 28 cents, to $13.17. Commodities behaved normally.
If the market doesn't crash by Friday, it will serve as testament to the recklessness and deceit of both Bernanke and Paulson and their unashamed pleas to help the feckless bankers, "right now." They should both be locked up and the keys tossed away.
My advice to congress - despite them never listening to me ever before - is to do nothing, adjourn and recess on Friday and don't come back until after the election. Sure, the stock market may be down some by then, but I'll bet the US and global financial systems will still be functioning.
Volume was moderate, not like there was a crisis or panic. It's bad, but not that bad.
NYSE Volume 1,152,885,000
NASDAQ Volume 1,999,011,000