The following excerpts will leave you thinking that you are watching some bizarro episode of the “Twilight Zone.”
Toss the consumer under the housing wheel of the bus and laugh about it:
"–I offer one more piece of evidence that I think almost surely suggests that the end is near in this sector. While channel surfing the other night, to the annoyance of my otherwise very patient wife, I came across a new television series on the Discovery Channel entitled “Flip That House.” [Laughter] As far as I could tell, the gist of the show was that with some spackling, a few strategically placed azaleas, and access to a bank, you too could tap into the great real estate wealth machine. It was enough to put even the most ardent believer in market efficiency into existential crisis. [Laughter]~David Stockton, Dec. 13, 2005, economist and Fed comedian.
So while publicly denying the existence or even the possibility of a housing bubble --- the Fed was privately laughing about its imminent and apocalyptic end. Jokes on us. The result of this meltdown is 22% unemployment, 43 million people on Food Stamps, 1 in 5 kids going to bed hungry at night, millions of homeless people resulting from foreclosures, millions of Americans watching as their largest investment (their home) tanks, local governments who rely on property taxes left struggling and a few failed bond auctions away from shutting down or being “bailed out”.
We are left holding the bag, as this past weeks Financial Sense News with G. Edward Griffin noted, WE - not the Fed - are the lenders of last resort.
The other day I saw Alan Greenspan say ‘Prove it’ (that he created the housing meltdown). The reporter gave him a free pass, all he had to do is ask Greenspan who created the years of cheap money, who muzzled Brookley Born (the CFTC Commissioner who wanted to regulate Derivatives) and who helped get rid of the Glass Steagall Act with a 3-2 Fed vote, and who failed to regulate the banks.
They knew, from the September 20, 2005 meeting:
“I’ll close with one other thing, the central banker’s anxiety, which is: “Good times are bad because they could turn out to be bad. Bad times are bad for obvious reasons.” [Laughter] I think you’ve given us a lesson in why these extremely good times are unlikely to be good for us in the long run.~ Ferguson.
Toss the consumer under the deficit wheel of the bus and laugh about it:
“Tell me, Sam, is there really any difference between Republicans and Democrats when it comes to spending?” And Cohen said, “I want to think about it, do some research, and give you a serious answer.” He called back the next morning and said, “Yes, George, there is. Democrats enjoy it more.” [Laughter] “But otherwise there doesn’t appear to be any difference.”~Fisher.