Under all the boom-and-bust news, old-fashioned American caution and thrift still exist, but the exemplars of those virtues are not being rewarded for them.
Smaller banks across the country complain they are being tarred by stress-test results of the Citicorpses and Bank of Americas that are soaking up bailout money after turning the old-fashioned business of savings, checking accounts and loans into high-stakes gambling.
“Banking should not be exciting,” says a small-town Indiana banker. “If banking gets exciting, there is something wrong with it.”
Depositors are suffering, too. Those who have saved enough to take out certificates of deposit now find one-year rates barely averaging 1 percent as worried banks see their FDIC insurance premiums soaring to cover the cost of sobering up institutions that went on drunken-sailor sprees.
Meanwhile, back on Wall Street, buoyed by recent market gains, the fast-buck boys are starting their spiels again, a recurrence of euphoria alarming enough to turn the usually cheerful Arianna Huffington into Cassandra.
Prompted to caution by, of all people, Eliot Spitzer, Ms. Huffington recalls John Kenneth Galbraith's warnings about "the pathological weakness of the financial memory" and a "mass escape from reality" in America's past.
Prudence is getting a lot of press these days, but those who practice it aren't getting much else.
Showing posts with label Wall Street recovery. Show all posts
Showing posts with label Wall Street recovery. Show all posts
Tuesday, May 12, 2009
Wednesday, September 17, 2008
Picking Up the Pieces
The cleanup crews are at work on Wall Street, President Bush cancels a fund-raising trip to cheer on his mop-up gang in Washington and, barely within camera range, the presidential candidates and Congress are blathering about who's to blame for the financial storm.
Unlike the hurricane damage in Texas, there is profit lurking somewhere in the Wall Street wreckage and, if the past is any guide, the would-be Warren Buffets should soon be emerging from their storm cellars and bidding for the best bits and pieces.
The stock markets are starting to stabilize as profit potential wrestles with fear for the free-lunch crowd trying to measure when the worst is over and the aftermath has begun. Vultures know by instinct when to swoop in.
As always, most of us will be examining our financial wounds and reaching for band-aids while the greed-is-good gang move in to do what they do best, but they too serve a social function by sopping some of the panic out of the system so we can stop agonizing and start believing that everything is going to be all right.
Bush defended government bailouts today, saying. "These actions are necessary and important, and the markets are adjusting to them." It's hard to argue with that, but maybe the next Administration and Congress will do a better job of reading the storm signals and getting taxpayers to higher ground.
Unlike the hurricane damage in Texas, there is profit lurking somewhere in the Wall Street wreckage and, if the past is any guide, the would-be Warren Buffets should soon be emerging from their storm cellars and bidding for the best bits and pieces.
The stock markets are starting to stabilize as profit potential wrestles with fear for the free-lunch crowd trying to measure when the worst is over and the aftermath has begun. Vultures know by instinct when to swoop in.
As always, most of us will be examining our financial wounds and reaching for band-aids while the greed-is-good gang move in to do what they do best, but they too serve a social function by sopping some of the panic out of the system so we can stop agonizing and start believing that everything is going to be all right.
Bush defended government bailouts today, saying. "These actions are necessary and important, and the markets are adjusting to them." It's hard to argue with that, but maybe the next Administration and Congress will do a better job of reading the storm signals and getting taxpayers to higher ground.
Subscribe to:
Posts (Atom)