Note - from June 24th 2009, this blog has migrated from Blogger to a self-hosted version. Click here to go straight there.
We might as well start sticking up statues of Lenin and Trotsly in our town squares - because today shows that the United States has shed any veneer of putative capitalism that it was clinging to.
Today there was a meeting at which th central planners decided they were probably going to bail out the likes of AMBAC (the mortgage bond insurer) - in other words, the ineptitude of AMBAC's management is not going to be punished (as it would be in a capitalist society). No. not a bit of it, tovaritsch. We can't have our campaign contributors falling prey to their own stupidity... let's use the taxpayers' money to ensure that these vermin get their $100 million payouts when they leave.
So the United Soviet States of America, whose advent was heralded by the establishment of the Federal Reserve, has finally burst out of hiding.
So why did we fight the Cold War? Why did we slaughter about five million south-east Asian peasants in the 1960s and 1970s? Weren't we told that the trillions we were spending as a society were to prevent the socialisation of capital?
And now it comes to this.
We ought not be too surprised - it has always been thus. if you're some poor schmoe who works in a car factory and you fall behind on your mortage payment,s your house goes back to the bank. (That is perfectly fair, by the way, and I would not have it any other way).
But if your cockup runs to the tens of billions of dollars, you can bet your ass that the government will come to your aid, and you will leave with enough money to rebuild Versailles in the colour scheme of your choice. It is disgusting, and the most disgusting thing is that the same people who will stick their grasping hands out for government bailout will decry 'government waste' (by which they mean 'public money given to someone other than us'.
Anyhow... on the back of this descent into out and out Sovietism, the Dow went from -335 to plus 298 in a little over three hours. that's a move of 635 points in half a session.
Oddly enough, 5 Dow components actually finished in the red. the index finished at 12270, which was just off the high of the day (12276) - and the low was all the way down at 11644.
Oddly enough, the Nasdaq100 lost ground, thanks largely to Apple (down 10% ish) and Google (down 6% ish).
My RantSheets are sadly out of action at the moment: the DNS propagation for the new server hosts happened without warning, and the permissions on the new server are really tight, which means that I get permission denied on my own scripts... which means that nothing generates itself. But simply take it as read that the rush you see today s not the first step out of the hole... it is just a generated slam upwards to help JPMorgan, Citigroup and some others get out of very very badly unprofitable positions (in their Level 3 books) before the legal opinion forcing them to account for them properly i rendered.
Tables (and perhaps even a chart) tomorrow with the OzRant. Frankly, today's US session doesn't deserve to be written about, except to excoriate the mandarins who think that their perverted form of proto-fascist croneyism can be passed off as a free market. Not on your life, chum
