An alternative view on life, politics, and computers
Greed on wall street
Published on September 19, 2008 By Calor In Democrat

The melt down on wall street is exactly what happens when you have a Republican and a Republican congress. Their faith in letting the market decides means that everyone else, the hard working Americans who make life in this nation possible, suffer the consequences for the greed at the top.

Republicans always claim that communism doesn't work because it doesn't work with human beings. Humans are too greedy and selfish for communism to work. But Democrats never argue in favor of Communism. They argue for a mixed economy.

By contrast, many Republicans loudly and frequently talk about the merits of "letting the market" decide.  What they don't realize is that laissez faire doesn't work either. We don't have anything approaching that but plenty of right wingers think that the solution to our economic problems is less regulation which just results in the mess we're in.

In reality, greedy people who know how to game the system tend to work with like minded allies. The result is you get greedy CEOs who protect one another and collude to enrich themselves and concentrate wealth not based on merit or "market forces" but through pure manipulation or gaming of the system.

So much of the wealth in this country is taken not by those producing a product or service but by people who just know how to manipulate the market, play the system, and skim off the labor of the millions of Americans who ultimately pay the bill when their short-sighted schemes fall apart.

McCain and his Republian allies don't understand this. They sometimes call for more oversight but it's a bandaid. What America needs is leadership from people who understand that the strength of our nation isn't just from the top 1% but by the hard working men and women of the entire nation.


Comments (Page 1)
on Sep 19, 2008

I don't know how you are blaming this on Republicans.  McCain was the first person to point out that Freddy and Fannie were on the brink of ruin several years ago, and tried to pass a common sense regulatory bill to stop the miss-management of these companies.  The former CEOs of both these companies are now on Obama's economic advisory team.  They might as well join his team since their former companies had given Barry so much money.  Check it out, these are the greedy bozos who screwed thing up, not the Republicans.  Yes, Republicans stand for letting the free market work out the kinks, but we don't have a problem with common sense regulations.  It's over regulation that gets us into as much trouble as no regulation at all.  Reps and Dems need to work together on this issue a little more, but right now there's too much corruption on both sides.  

We conservatives know that the strength doesn't just lie in the top 1%.  Talk about the super rich is just a typical Democratic distraction.  How about instead of pandering to the poor and middle class with fancy words, we actually empower them to be able to turn their hard work into success.

While I'm sorry for people whose IRA's and 401k's took a beating recently, I have to say we all need to be more involved in what our fund managers do with our money.  We complain about the anything goes old west tactics of Wall Street, yet most of us simply hand our hard earned dollars over to fund managers we know little about, and then cry foul when they lose our money.  I'm sorry, but your money is your responsibility, and if you didn't do your homework and give your fund manager a little more direction about what you want him to do with your money, then losing your retirement is as much your fault as his.  Take responsibility for your own actions.

on Sep 19, 2008

You may wanna rethink your article, and the title of your blog for that matter. There is no sanity in a person accusing the the Republicans of the rollercoaster ride on the Market when Franklin Raines and Jim Johnson, 2 of Obamas top economic advisors benefitted from Fannie-Freddie and then screwed the company up while Obama made millions from them. Talk about hypocrisy. God forbid Democrats blame the ones who abused the system.

on Sep 19, 2008

The blame falls on neither the Democrats or Republicans, at least not completely.  If you must blame someone just take a look at the Federal Reserve.  The entity that had set interest rates so low that banks were clamoring to lend, lend, lend because the money was essentially "free".  This caused the birth of the sub-prime loan, which is what got us where we are today.  These sub-prime loans made it so that people, with really crappy credit who had no business borrowing money, to buy houses which in turn caused builders to build more and more houses.  This created our housing bubble which eventually burst, as many knew would happen but chose to ignore because times were good.  Now those same banks that made risky investments in sub-prime loans are faultering and asking for help.  Well guess what folks when you take a risk like that you need to pay the price.  The true free market way out of this mess is to let those banks fail, there should have been no bail outs at all.  Yes it would have been chaos for a while, but the economy would have been better off for it.  Instead we have a government more than willing to hand over hundreds of billions of dollars to reward the people who took huge risks and failed.  This isn't going to help our economy, it's going to hurt it because it sets a precedent now that you can make whatever risky investments you want because in the end the federal government will be there to rescue you.  Way to go government.

If you are as sick of this as I am there is a solution, VOTE AGAINST INCUMBENTS.  Sure they aren't in the Federal Reserve but our government has the authority to either pull power away from the Fed, add more regulations on them, or shut them down entirely.  If you want to avoid this whole fiasco from happening again do what you can to actually change things, VOTE AGAINST INCUMBENTS.

on Sep 19, 2008

It's not letting me edit.  That first line should read: "The blame falls on neither the Democrats or Republicans, at least not directly."

on Sep 19, 2008

Free market works in theory, just as communism works in theory.

However, theories don't often translate well into the real world especially with all the outside factors affecting it.

We do have mixed economy...there's government interference in many aspects of the economy...it's what keeps things a little more ordered and buoyant.

I'm just amused at how the government's been bailing out businesses left and right recently and yet Republicans still bitch about regulation...that's interesting.  "Do as I say, not as I do" I guess...

~Zoo

on Sep 19, 2008

This caused the birth of the sub-prime loan

This is only partially true.  Our wonderfull leaders in Washington passed regulations that forced sub-prime lending on institutions.  This mixed with the fact that money did become too cheap made for one disasterous malitov cocktail.

on Sep 19, 2008

We do have mixed economy...there's government interference in many aspects of the economy...it's what keeps things a little more ordered and buoyant.

And it's a delicate balance between overregulation and underregulation.  The problem that we are seeing now is due to underregulation, no one was checking up on what the banks were actually up to with these sub-prime loans.  Had proper regulations been put into place you wouldn't have had loan officers fudging loan applications to get just about everyone approved for a loan.

on Sep 19, 2008

All I Know is the down swing in economics started with the advent of the Democratic Congress, as did higher gas prices and all the trickle down from that, such as higher food prices, higher sundry prices. All this is FACT not some talking head points.

on Sep 19, 2008

Your premise is one sided.  Read "Atlas Shrugged" for the other side.  If you HAVE read it, you clearly didn't get it.  Read it again.

on Sep 19, 2008

While I'm sorry for people whose IRA's and 401k's took a beating recently, I have to say we all need to be more involved in what our fund managers do with our money.

In the early 90's I began to hear a new word around Wall Street: "Guestimate."  While working for Merrill Lynch's phone company at the WTC we were able follow the markets and control our 401k investments daily. Merrill "downsized" by selling our department and the new management modified our 401k's structure. As a result we could only adjust our portfolio every 90 days.  By then, with any up- or down-swing having taken its course; we could no longer act upon or react to market forces. In other words, we'd have to" guestimate" the markets three months in advance. (If I could do that I wouldn't have needed to work for Merrill Lynch or anyone else for that matter.) Many of us saw big chunks of our retirement investments disappear during the mid-90s drop.

While researching possible "lateral promotions" with other potential employers I found out that the modified 401k approach was commonplace within other firms. Now I hear others say we are to blame for allowing others to mismanage our retirement monies. Using this rational it would be prudent to say that had I still worked in that ex-Merrill department which was located inside the WTC it also would've been my fault for allowing myself to perish that day when the towers fell.

While the cat's away...In my opinion the extra war (Iraq) has contributed to the current financial fiasco. Both Congress and the Administration have been busy looking overseas and failed to deal with what was happening at home. Now's time to pay the piper. Again WE THE PEOPLE bear the cost/loss.  We gotta stop sticking our collective heads in the sand when times are good so we can avoid the abuses/abusers that brings us to bailout solutions time-and-again.

on Sep 19, 2008

I have to laugh here.  Not one of the companies that have failed were free market companies.  They are companies that were either given guarantees by the government, or partially owned by  them.  This isn't an example of failure of the free market, this is exactly what happens when you tell companies to go ahead and take stupid risks with investments, we'll cover your losses.

on Sep 20, 2008

The melt down on wall street is exactly what happens when you have a Republican and a Republican congress

Good thing we DONT have that, right?  Instead (like the S&L meltdown) we have a Democrat congress - again!  There is a reason the meltdown waited until Pelosi and Reid were in charge - they caused it!

on Sep 20, 2008

If there were any doubts about Calor's hyper-partisan status... this should clear it up.  Interesting read though. 

on Sep 20, 2008

Let's take a time machine back to May 6, 1999. On this date, Congress passed the Gramm-Leach-Bliley Act. This law covered an awful lot of territory, including repealing many of the rules the Glass-Steagal Act of the New Deal Era set in place. A major implication of this is that banks were now allowed to offer insurance, consumer banking, and investment banking services. Just a small list of things directly caused by the Act:

  • The Enron incident, due to the now-infamous "Enron Loophole" energy speculation policies the law allows
  • The sub-prime mortgage crisis
  • The eventual collapse of several major finance companies, including Lehman Brothers, AIG, and others
Alan Greenspan - who is not exactly a liberal - will also tell you straight up that the Gramm-Leach-Bliley Act probably has the most culpability in this current crisis.
It was written by then-Senator Phil Gramm, who has also been a paid to lobby congress for even fewer banking regulations by Swiss Bank UBS. Phil Gramm is also the author of John McCain's current economic policies.
Not one of the companies that have failed were free market companies.
So . . . you're trying to tell me what the Republican party actively encouraged a socialized market? I mean, don't get me wrong, that's certainly what we have. But that doesn't exactly fit the rhetoric of the past 30 some-odd years, does it?

on Sep 20, 2008

PS. That Gramm-Leach-Bliley Act? McCain voted for it.