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OpenMarket: October 2008

  • NEW VIDEO: Global Warming and Eco-Imperialism

    October 8, 2008
    Coming from the UK, CEI Senior Fellow Iain Murray knows a little something about the history of political empires. Today, however, we find ourselves faced with a new era of eco-imperialism, particularly in the field of global warming policy. Iain explains:

    Binary Data...
  • Sketch Pulled from SNL focused on the Wall Street Bailout

    October 7, 2008
    I can't embed this because it keeps getting pulled. Thanks to Pat Dollard for hosting this video. This is what SNL should be doing, speaking truth to power. The sketch makes some great points:
    • Bush warned about Freddie Mac & Fannie Mae long before the Democrats, even though Pelosi has said the opposite and lauded the President's economic policies
    • Many home buyers who were affected were horribly under qualified for mortgages
    • Other home buyers were wealth opportunists who will be OK in the long run
    • Those benefiting from the bailout are wealthy investors who don't need a bailout
    • George Soros is a jerk
    Of course it got pulled because it's too harsh on the Dems and SNL can't be too harsh on their favorite politicians! Thankfully at OpenMarket.org we realize that all politicians are worth lampooning. Check out the video here:...
  • Quotes of the Day

    October 7, 2008
    Arnold Kling:
    Instead of thinking of the pending bailouts and financial regulation as a new era of government supervisions of markets, think of it as preserving the system in which a Harvard elite controls other people's money. In fact, very little is likely to change. Reading the news stories about how Secretary Paulson plans to implement the bailout, it seems as though the same people will be in charge of the money. Print some new business cards, change the logo on the front from "Goldman Sachs" to "U.S. Treasury," and everything else continues as it was. It's just that it becomes a lot more difficult for ordinary people to opt out of using the elite's money management services.
    Indeed. Alexander Hamilton would be so happy. And from across the pond,...
  • Deregulation Wasn't to Blame for Financial Crisis

    October 7, 2008
    Even the reliably-liberal BBC says that deregulation wasn't the cause of the financial crisis.   Other liberal journalists like Washington Post columnist Sebastian Mallaby have made the same point. The government-sponsored mortgage giants Fannie Mae and Freddie Mac played a big role in spawning the mortgage crisis.  Lawmakers like Barney Frank blocked crucial reforms that might have reined them in.  Now, Frank is trying to change the subject,...
  • EverBank Can Multiply Your Financial Woes

    October 7, 2008

    Is any of our readers an expert on banking laws and customs?  The reason I ask is that recently, EverBank World Markets, after agreeing to renew a CD denominated in Icelandic Krona, suddenly closed it, purportedly because the "currency stopped trading." 

    The bank then "converted" my CD from Icelandic Krona into dollars at an eye-popping rate of 171.98 per dollar on October 6, cutting the value of my CD from $5691.11 to $3744.68 -- a loss of two thousand dollars -- by assigning the krona an extraordinarily low value.

    What is extremely odd about this is that the exchange rate that EverBank recorded -- 171.98 per dollar -- is strikingly different from the rate of 112 Krona per dollar cited on EverBank's own web site yesterday, and the rates cited by other financial information sources, like exchange-rates.org.   (Even those rates were themselves a huge drop for the Krona,...

  • Neither carrots nor sticks II

    October 6, 2008
    Further to my earlier post on Latin America, The Wall Street Journal's Mary O'Grady points to a good way for the U.S. to deal with loudmouth thugs like Hugo Chavez:

    Hugo Chávez provoked nary a peep from the Bush administration when he recently welcomed Russian fighter jets to an air base in the state of Aragua. For a man desperate to prove his importance, nothing could have been more insulting than the yawn in Washington when the Russians touched down in Venezuela.

    Indeed, which makes the American politicians who choose to pal around with Chavez's lackeys all the more pathetic.
  • Neither carrots nor sticks

    October 6, 2008
    Few things are as exasperating as watching two sides argue -- and neither rise above being half-right, at best. Still, the resulting exchange in this case is thought-provoking. Today, the left-liberal Center for American Progress responded to a Washington Post editorial calling for a tougher stance on the part of Washington against Latin American autocrats like Hugo Chavez and his cronies in Nicaragua, Bolivia, and Ecuador. While the Post editorial is right on more counts than is the CAP piece, they both seem to buy into the notion that the internal policies of Latin American countries are any of American policy makers' business. Yes, the United States wields enormous influence in the...
  • The Bailout will cost 20% of the entire current budget

    October 6, 2008
    My Calculations: The 2007 federal outlays from fiscal year 2007 were 2.73 trillion. The 700 billion is to be allocated before Dec 31, 2009 (or Oct 3, 2010 with the extension). Taking the 15 months until Dec 2009, and multiplying 15 divided by 12 by 2.73 trillion (because of the Continuing Resolution) would be 3.4125 trillion. Then taking 700 billion divided by 3.4125 trillion is 20 percent. Why is the market tanking?  Wall Street knows what this will do to our economy.
  • Lehman Bros hearing -- Rep. Maloney blames deregulation, ignores her own role as Fannie's enabler

    October 6, 2008
    At the hearing being held today by the House Oversight and Government Reform Committee, in which former Lehman Brothers CEO Dick Fuld is now testifying, an earlier panel attempted to look at the causes of Lehman's collapse and the broader credit cirisis. And this gave an opportunity to committee members to ride their various hobby horses. Rep. Carolyn Maloney's horse and "whipping boy" was deregulation. She blamed the entire crisis on deregulation, and specifically the repeal of the Depression-era Glass-Steagall law that separated commercial and investment banking. The repeal was done through the Gramm-Leach-Bliley Act, which Maloney neglected to say was passed on an overwhelmingly bipartisan vote and signed by President Bill Clinton in 1999. Clinton, in fact, recently defended the law, saying it didn't contribute much to the...
  • Bailout Dangerously Concentrates Power, Harms Economy

    October 6, 2008
    The $700 billion financial-system bailout was billed as a miracle cure for the economy, but the stock market dropped dramatically after it was enacted, falling more than 500 points.  In the Washington Post, the liberal journalist Sebastian Mallaby points out that "blaming deregulation" for the financial crisis makes no sense.   He puts some of the blame for the crisis on the Fed's easy-money policy -- an argument made by commentators across the political spectrum, including the conservative Wall Street Journal, and...

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