Hear No Evil; See No Evil

Here's proof government causes major distortions in the marketplace, and they don't listen to the responses.

A story published on Yahoo News November 12th, entitled “Stocks lower as Paulson unveils change in bailout,” states:

"...the government's $700 billion financial rescue package won't
purchase troubled assets from banks as originally planned.

Paulson also announced a new goal for the program to support
financial markets which supply consumer credit in such areas
as credit card debt, auto loans and student loans. He said,
'with a stronger capital base, our banks will be more confident'
to support economic activity."

Later in the same article, is the news of widespread reaction.

“Morgan Stanley outlined plans to cut 10 percent of staff... The layoffs are in addition to a 10 percent cut made earlier this year.”
“Morgan Stanley also plans to restructure its money management business by cutting 9 percent of the group's workforce.”
“In midday trading, the DOW shed 278.21, or 3.2 percent...”
“...Standard & Poor's 500 index dropped 29.34 points, or 3.26 percent...”
“the NASDAQ composite index stumbled 47.86 points, or 3.03 percent...”
“The Russell index of smaller companies fell 17.00, or 3.52 percent...”
“Declining issues outnumbered advancers by about 9 to 1 on the New York Stock Exchange.”

An article published mere hours later says it all: "Stocks skid on news gov't won't buy banks' assets."

So my question is: exactly what part of “more confident” was Mr. Paulson talking about? The banks? Obviously not. The markets? Nope. Consumer spending? No. That's down also. So they must have their fingers in their ears, and hands over their eyes, because the signals that stampede by the rest of us are incredibly obvious, but seem to pass by Washington without so much as a pitter-patter sound. And they're paying no attention whatever to the trillions of dollars in private investments in the stock markets, which make up college monies, retirement savings, vacations, etc., all drying up and blowing away every time they make one of these announcements. And to make matters worse, they're going to expand the program. No surprise there. In this one Yahoo News article, we have perfect examples of the three things gov't does best: lie, grow, and waste money. I said it elsewhere on this page; bureaucrats need to be beaten over their heads with reality. Let us not forget that this all happened in less than 24 hours. So thanks, Mr. Paulson, for all of your "help." With friends like you, who needs enemies?

I would like to make a prediction. This bailout program will not work. If there is any response at all, it will be marginal at best. When this failure becomes apparent to the power players in Washington, they will do two things: lobby for more money, and further contort their bailout package to make it look like they're doing everything they can. They'll then tell the people, “This time it will work.”

http://biz.yahoo.com/ap/081112/wall_street.html
http://news.yahoo.com/s/ap/20081112/ap_on_bi_ge/financial_meltdown
http://biz.yahoo.com/ap/081112/wall_street.html