Monday, October 4, 2010

The Great Recession Marches On

There isn't a lot of media coverage, but bank failures continue. This is highly reminiscent of the early 1930s before FDR came into power and declared a "bank holiday" which shut down all the banks so that the sound one could be winnowed from the bankrupt ones. Obviously Obama is not an FDR, so that isn't going to happen. Instead, the banking system will limp along. It is a boat anchor helping to make this Great Recession truly "great"...

What kills me is that unlike FDR who experimented and who had his "fireside chats" to buck up the spirit of the people. Obama lets his "experts" diddle and fiddle, putter and mutter, and the whole mess just slides like goop from month to month. Tragic.

Back in late 2008/early 2009 Paul Krugman was saying "use the Swedish model" to recover, i.e. step in and "nationalize" the banks. Americans fear the word "nationalize" but this is the proper term for having the FDIC come in and seize assets of all insolvant banks to ensure depositors their money and then sell off the bad assets. This cleans up the mess fairly quickly, it was done for the S&L disaster of the 1980s, but Obama refuses to do it for the Great Recession.

Ah... but the difference between Obama and FDR? Obama has been bought and sold by Wall Street. They are his biggest money backers. FDR ran against the capitalists in order to save capitalism. Obama is hog-tied by his capitalist backers so he is at their beck and call and they are stupidly bleeding the country dry in a decade long Great Recession just like Japan.

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