The slumping financial markets have been rebounding steadily in the past month for several reasons, including regulatory and legislative decisions in Washington. The Dow Jones Industrial Average closed on Friday above 8000, a dramatic increase from the 6500 level of four weeks ago.
The true nature of neo-conservative has been revealed as neo-con. We are being conned big time and this trifecta of policy addendums is adding to the mis-information in the marketplace:
- The removal of mark to market accounting
- The push to ban short selling with the upkick rule
- The Geitner Plan propping up the land market
Stiglitz rips into the Geitner plan (above) and Jeffrey Sachs expands on this to show just how easy the scheme would be to rip off with an off-balance sheet arrangement.
The change away from mark to market accounting will allow banks to embellish asset prices. Isn’t the market meant to correct itself? The con in neo-con comes back to haunt us….This move aims to save more banks from liquidation. Does it infer a return to Mark-to-Model?
The soon to be announced banning of short selling by the introduction of the upkick rule will prevent corporate whistleblowers from holding a company accountable. Whilst shorting does seem to be against the spirit of capitalism, it is a warning signal to others. Share prices will be propped up until one of the whistleblowers briefs a journalist.
All in all its another move to preserve the current players, maintain the wealth gap and increase the inter-generational gap.
Schumpeter would be turning in his grave with Creative Destructionism making way for Bailout the Destroyers.
To top things off, read this white collar piece on AIG’s side letters and whether they intended to be bailed out or not.
Yawn, yawn, yawn…