Here’s what I don’t understand about all the people who are screaming that Obama is trying to do too much at once, that he’s “using” the economic crisis to push through a major ideological change. Which part of health care, education, science, infrastructure and defense do they think is NOT part of the economy?

See, here’s the thing. We don’t put any money into education, and 50,000 or so teachers lose their jobs or don’t get hired. We don’t put money into health care, and we lose a hundred thousand or so health care jobs – not to mention all those jobs that are eliminated because employers can’t afford to pay for the health insurance, and all the people we that hospitals can’t hire because they’re spending twice as much on information and technology as they need to. We don’t spend money on infrastructure and refuse to give money to the states, so the cities and the states lay off another couple hundred thousand DPW and Department of Sanitation and Health Department workers and police officers and city hall support staff.

We just “fix the banks” by giving them money to lend to people so that y’know, they’ll do what we expect them to do and lend the money to people. The only problem is… because we didn’t put the money into education and health care and infrastructure and state governments, there’s no people to lend the money to.

And another thing – those folks screaming that the market keeps falling because they don’t like Obama’s spending plans? How can they, on the one hand, blame Wall Street excess and greed for the economic tailspin and on the other hand, believe that a falling market signals a failure of attempts to rein in those excesses and that greed?

See, I understand that when the market tanks, people lose money in their 401ks and retirement funds and it’s PAINFUL. But that money? It was earned in a climate of unregulated greed that pushed values of things way way out of proportion to their actual value. Now that those illusory values have collapsed, those values are returning to where they should have been. I’ll tell you this – if you support clawback (and frankly, I think we should be calling it “reimbursement”), then you should also accept that yes, those profits got clawed back from your 401(k), too.

You also need to understand that those folks on Wall Street? They’re not going to be happy with ANYTHING that makes it harder for them to make the kind of money they’d got used to making. Right now, they’re crying like babies that didn’t get their accustomed mid-afternoon candy bar. They’re stomping their feet and holding their collective breath until we give them back their bon bons – and the Republican party is standing there demanding that we promise them their candy to make them breathe again.

Now, as a parent, I can tell you this. If you give the kid back his candy, you just taught him that if he holds his breath long enough, you’ll give him candy. Here’s the truth – your kid may turn blue, but holding his breath isn’t going to kill him. You just have to wait it out, because eventually, he’s got to take a breath. His body will make him. Likewise, the markets will NOT stay stuck forever. Remember, kids, those big sell-offs? For every person selling off their stock, SOMEONE is BUYING. And when someone starts buying, the prices start going back up.

That’s what’s going on today. All day, I’ve been hearing that the markets are gaining in the triple digits because Citi announced that they made a profit in the last two months. Uh huh. Maybe. The market certainly rises and falls on rumors, hopes and fears. But the market turns on money. Anyone who studies market charts – without paying the LEAST bit of attention to the news – could have predicted today’s upswing for one basic reason – the market hit another support level yesterday. When that happens, the market does one of two things – it either totally plunges – or it trends back up because all the folks who’ve been waiting for the stock prices to hit those bottom lines are jumping in to buy. And when they do that – well… the market perks up because more demand means higher prices. See?


This entry was posted on Tuesday, March 10th, 2009 at 6:05 pm and is filed under economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
1 Comment so far

  1. Maureen on April 18, 2009 5:11 pm

    Wisdom?, I ‘m not sure but comments, you bet. I looked up some health care statistics in Wikipedia (sp) yesterday. Did you know that the U.S. is the only industrialized country that doesn’t offer health care to its people. Shameful.
    As for our economy, greed in our financial sector has been driving us for longer than I can remember, so now we are paying for our previous governments greed and deregulation of the banking industry. Yes,you are right, we can’t expect Obama and his folks to fix everything overnight.Let’s just hang in there, support one another and our new President. Keep the faith. mg

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