Wednesday, April 22, 2009
The apology tour continues
Timothy Geithner has acknowledged American "fault" for the world financial crisis. More falsely modest candor from an administration that believes that humility on behalf of its predecessors comes at no cost. Yes, the United States bears some significant part of the "fault" for the decline in the global economy. Europeans and Chinese, however, generally think that it is all our fault. The cause of the crisis was a massive and sustained increase in the availability of credit all over the financially developed world, and until the world recognizes the problem we will not solve the underlying problem.
5 Comments:
By 
, at
Wed Apr 22, 09:57:00 AM:
In my view, the problem was separating risk from reward. Investors were able to leverage their resources and shift the risk of failure to others. No lender would have made such poor loans to such unqualified buyers if they had been spending their own money. But, since the bad loans could be securitzed and sold to others they had no down side. That was the problem.
By 
TigerHawk, at
Wed Apr 22, 10:24:00 AM:
But the securitization of credit was a function of liquidity. It was a necessary but insufficient partner. Anyway, that's a long discussion about which I may get around to writing a long post some day.
By , at
Wed Apr 22, 01:50:00 PM:
I thought other economies, Germany, Japan, UK etc went into recession months before our crisis. The new theory being that oil prices triggered the crisis, and the financial collapse was an effect not a cause?
By , at
Wed Apr 22, 05:48:00 PM:
I was at lunch when I heard Geitner's droll excuse for the global collapse. I have to say, I am more than sick and tired of hearing both he and Obama taking all of the blame. When do we get the credit for buoying roughly one-quarter of the world's economy; which a mere twenty years ago it was probably one-half. The kind of growth that has taken place in most countries does not happen without the American consumer and the American Capitalist machine. None of that happens without American exceptionalism. Furthermore, as Obama continues to take the blame for every bad thing that has happened to the world; do we also get to take back all of the good too?
Can we reinsert Hitler, Stalin, brutally imperialistic Japan or the former Soviet Union? or can we take back all of those medical advances and technical advances that have made this world more livable? Can we also take back all of the lands we gave back after we kicked the shit out of Japan, Germany, France (in German hands), Poland, Italy, the entire middle east? While we are at it, could all of these people please pay America back for all the blood and treasure we spilt in order to get their countries back to a functioning free democratcy, free of dictators. At a minimum, could all of these countries that sit and take our aid or meekly hide under the military cover we provide them, just pay us back for the cost of that umbrella?
TH, may you should have a blog that your readers try to count all of the direct and in-direct ways America has improved the lives of the broader global village?
By JPMcT, at
Wed Apr 22, 08:19:00 PM:
Yeah...but what have we done for them lately?!!
Europe has the same short memory for America's greatness that the younger generation of Americans do.
Partly poor education, partly growing up rich, partly...perhaps mostly...because the fire in the belly has gone out...the current crop of voters in the US and Europe want sinecures and government checks...and they will elect those that provide it.
The rest of us go to Tea Parties and get angrier...and angrier...
