Friday, January 11, 2008
SNAFU in the Senate
WASHINGTON (Dow Jones)--U.S. Senate lawmakers have ordered federal investigators to examine foreign state-run investment funds and whether the much-needed capital infusions being provided to major U.S. banks raises any economic or security concerns. The Government Accountability Office this week began an investigation into sovereign wealth funds, including the size and types of investments funds are making in U.S. markets, a spokeswoman said. The probe, which was requested by the Senate Banking, Housing and Urban Affairs Committee, will also examine what oversight - both international and in the U.S. - is conducted on the funds and whether the funds pose a risk to U.S. economic stability.I hope part of the "investigation" will also examine the risk massive bank failures will pose to US economic stability. As Dr. Mercury might say, "Morons."
Of course it is not desireable that our institutions happen to need massive amounts of liquidity right now, but they do, and the sovereign wealth funds are the only source available at the scale that is necessary to keep Merrill, Citibank, UBS, etc. from becoming insolvent. To get in the way of these transactions now would be supreme folly.
5 Comments:
By 
, at
Fri Jan 11, 10:14:00 PM:
Just can't make this stuff up. Clear evidence current Senators should not be considered for President.
By 
TigerHawk, at
Fri Jan 11, 10:43:00 PM:
We ship a lot of dollars overseas to buy oil from Arabs and Wal-Mart's inventory from China. Those dollars have to come back here somehow. Yes, it would be best if they were recycled the old-fashioned way, by selling outrageously overpriced office towers at a billion dollars a pop. Unfortunately, the Arabs and the Chinese have learned from the mistakes of the Japanese in the 1980s. Instead, they are injecting capital into multinational corporations to shore up balance sheets that were depleted with payments that ended up in the hands of home-builders and their employees or Americans who sold their homes. It seems like a reasonably good way to get those dollars back (at least if we cannot sell them grossly overpriced office towers).
By , at
Fri Jan 11, 11:17:00 PM:
Arab governments can buy shares of banks? I thought usury was forbidden under islamic law.
Alan
By , at
Sat Jan 12, 11:06:00 AM:
"As Dr. Mercury might say, 'Morons.'"
Well, so much for my reputation as a purveyor of intelligent discourse. :)
"Those of you rooting for the insolvency of US financial institutions can breathe easier. The Senate is on the case!"
Ouch! Nice zinger! While your brother is a superb writer, one tool he doesn't pull out of the bag very often is sarcasm, but I view it as a very effective tool. Well, provided the audience 'gets it,' of course. The above was Grade A quality stuff.
"Of course it is not desireable that our institutions happen to need massive amounts of liquidity right now, but they do..."
That, unfortunately, seems to be the biggest Achilles' Heel of politicians -- they can't ever seem to focus on the now.
Did you watch the S.C. debate the other night? The candidates were all asked how they'd fix the current problems the economy has, and -- with one exception -- they all launched into these long-term plans ranging over the next ten or twenty years. Less dependency on foreign oil. Alternate forms of energy. And so on.
The one candidate who laid out a whole raft of things he'd do immediately? That is, the only person who actually answered the question?
You guys should already know the answer.
Fred Thompson.
It was really a telling moment, and demonstrated exactly what Villy is talking about here. Few things are scarier than the government 'fixing' something.
For example, the California state government has just figured out how to 'fix' their energy problems:
State-regulated household thermostats.
Via remote control, no less.
I suppose the next step is to install a small state-monitored camera in every home, just to make sure criminals are kept at bay and the children are kept safe.
George Orwell, call your office.
By , at
Sat Jan 12, 03:34:00 PM:
BUNGLING INCOMPENET LIBERAL DUMMYCRATS
