22.9.08

OBSERVATIONS OF THE DAY. Nailed to Newmark's Door.
These are just links that I think are interesting or useful or both. They may not even be the best links I've seen recently; they're just ones I could gather quickly on a Sunday morning when I should be doing other things.
Not quite "Here I stand, I can do no other." No matter. Read. Follow the links.

The early commentary on the financial system bailout comes in two forms. Some comes from an ideological perspective, whether that's Trotskyist or Crolyist or Hayekian. Some is more pragmatic: sometimes the government gets paid.

But even there, there are tradeoffs. Yes, Chrysler did repay its guaranteed loans. But it used the breathing spell to develop the minvan (just the thing for yuppie hell in Oakland County) followed by the Ram series of pickup trucks (playing to that Macomb County crude) all as if cheap fuel would go on forever.

And yes, the government did turn a profit privatizing Conrail. But it passed up the opportunity to sell pieces to other eastern systems, the outcome that private markets chose nearly 20 years later.

The true cost of the financial rescue might not be known for years. There's a contingent liability of unknown size. Some houses will be sold under more conventional mortgages in the near future, and additional houses will be sold later. The taxpayer exposure to bad debt is there, but nobody knows how much or for how long.

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