Friday, March 06, 2009

Why the right is to blame for the Dow's decline

By Michael J.W. Stickings

Predictably, the right has been blaming the decline of the Dow, as well as of the markets generally, on Obama and his supposedly "socialist" policies.

As usual, the right is dumbfoundingly wrong. Here's Robert Reich at Salon:

The argument that Obama is somehow responsible for the collapse of Wall Street is absurd. First, every major policy that led to this collapse occurred under George W.'s watch (or, more accurately, his failure to watch). The housing and financial bubbles were created under Bush and exploded under Bush. The stock market began to collapse under Bush.

Second, it's inevitable that stocks, led by the bloated financial sector, would lose their remaining hot air as the new administration begins "stress-testing" the big banks, many of which are technically insolvent. After all, their share prices were built on a tissue of lies and dreams. Other sectors whose values were similarly distorted and distended by years of financial deception and regulatory disregard, such as housing and insurance, will also have to return to the real world before they can recover. Which could mean more stock losses.

Finally, none of the financial wizards who are now charging Obama with leading America into the abyss have offered an alternative plan for getting us out of the mess that, not incidentally, many of these same wizards happily led us into. For years, the Wall Street Journal editorial page and the financial gurus of cable news cheered as Wall Street leveraged its way into oblivion.



If you haven't seen it already, make sure to watch Jon Stewart's awesome takedown of CNBC from the other night. Creature posted it here.

Labels: , , ,

Bookmark and Share


Post a Comment

<< Home