Friday, September 19, 2008
What Happens if the Chicken Coop's been foreclosed when chickens come home to roost?
Some rose-colored glasses-wearing folks I hear about assume that this financial crisis no worse than others (e.g., the leveraged buyout/junk bond madness that led to the Savings and Loan Crisis and subsequent bailout, the demise of Wall Street titan Drexel Burnham Lambert, and imprisonment and/or tarnishing of fat pocketed Michael Milken, Larry Keating, etc.; or Enron and the associated demise of Arthur Andersen. In fact, a few years ago, a mortgage lender I know cavalierly said "the government will come in and save everything if it comes to that" when I demurred (again) in response to his idea of leveraging the fastly escalating equity in my home. Other folks, who may or may not endorse the idea of stuffing money in mattresses, realize that these are scarier than ever financial times we're living in. Steve Pearlstein explains exactly what's happened and Stephen Dubner explains, chiefly, how it happened. What I want to know is, what were these guys doing?! Senator Dodd's all over the press with alarm and indignation now; isn't oversight of the banking industry within the purview of the Senate Banking Committee that he chairs?
Posted by MtnGrl at 12:32 PM