Raistlin - Sorry I missed your response.
what i meant was, is the comparison fair? the sheer size of losses recently dwarfs the losses in the 80s, yes?
If you mean the number of bank failures and potential ones, not really. BOA, CITI, and the others would not have failed. TARP was not meant to prevent them from failing. It was meant to make them start loaning again to small business. The failure of the real estate market had dried up credit. Business requires short term loans (bridge loans if you will) that allow them to buy inventory before they realize the profit by selling it. The banks were never (other than the weak ones) in any danger of a mass failure. So it was actually not as bad as the 80s (it could have been), and definitely not as bad as the 30s.
well, this site states that 91 republicans voted in favour of 1424. not a vast majority or anything, but still enough imo to claim it was more than just democrats controlling the purse strings. not to mention there was no opposition/objections from bush; surely the president has to take responsibility for legislation he signs??
Indeed, it was not a "democrat" thing any more than it was a "republican" thing. It was a bad thing. I was not trying to indicate it was all democrat, after all Bush asked for it. But the democrats were not innocent lambs being lead to a slaughter either. They were fully complicit in it.
the only resource ive been able to find is wiki, but id prefer not to use it with regards to the comparison. could you provide a brief comparison between the amount of dollars lost and the number of banks that collapsed? because my understanding is that both numbers are stubstantially bigger recently than in the 80s. and yes, by "banks" i include brokerage houses and insurance companies caught up in the risk (that some people dont believe existed).
I will research it for you and see what I find. You include brokerages and insurance companies. I have not looked at those, so the number will be different than the figures I was using because I was only looking at Banks. Companies fail all the time. But the target of the discussion was banks. This time around, GM and Chrysler failed (not the first time for Chrysler either). So are you looking for all failures? or Bank Failures? The 80s failures was almost totally in the banking and SLA areas (with of course fall out hitting the housing sector). And as an impact on the country, it was very mild because it was confined to one area.
well i have to ask (and please don't be offended) but are you are REAL economist, or just an "economist" of the austrian school dressed in monetarist clothing? i mean, williams has links to mises on his site? really?
mises? I am unsure of what that is. You are looking at Walter E. Williams, are you not (there is another that Dr. Williams always clarifies so to avoid confusion). I am an economist by education and trade (for many years post graduate before I switched careers).
well, ignoring the fact that a chairman of the federal reserve is inherently and inevitably a market intervener, i have read nothing from bernanke that would suggest he was anything but a monetarist in the long shadow of friedman. indeed most of his work on the depression echoed friedman and shwartz fairly closely. he certainly favours leaving markets alone to do their thing, except in exceptional circumstances.
im not sure how paulson could be described any other way though, being a rabid free marketeer is how he made his mark (well until the crisis obviously). i mean, im sure you saw his haunted visage when explaining the necessities of effective nationalisation during the peak of the crisis? not a happy chappy. gutted even. until the crisis i am unaware of paulson's economic opinions being anything but unwaveringly free-market orientated. if you have some, id love to read it.
I would suggest reading Paul Krugman, pre and post Enron days to find out how a wolf masquerades in sheeps clothing. What they say is not what they do, but you can get a hint at their nature from their previous writings. Bernanke is definitely an interventionist. And that is why he is trying to monkey with the fed rate to such a degree (he made the same mistake Greenspan did with interest rates - they are not short term fixes). Bernanke talks a good talk, but he has yet to walk it. Friedman would not be pleased at all with his actions.
before most elected government officials even became aware of seriousness, bernanke and paulson were in the backrooms hammering out deals to prevent implosion.
I stopped here because the premise is wrong. They were not preventing an implosion, they were maintaining the status quo. Which leads directly to the last point of why the banks did not do what Obama wanted them to do with the money. When you maintain the status quo, why would you think people would change? failure of industry is a winnowing process. It forces the institutions (the ones that are left) to rethink the paradigm and change their ways (for it becomes painfully apparent the old ways did not work). But TARP stopped that from happening - leaving the old guard in place. To continue doing what they had been doing. Which was not want Obama wanted, but when looked at, readily obvious what was going to happen. If you do not discipline a child when they do wrong, how are they to learn. Same thing here.
TARP did not save the wheat. It saved the wheat and the chaff. A quick painful correction would have gotten rid of the chaff.