The known world appears closer to collapse after the US Congress rejected a bailout plan designed to restore confidence to stricken banks. Wall Street promptly had one of its worst days ever and shock waves were felt all over the globe. The Times reports on the debacle here, in what might be described as a style of hard-edged abstraction: no frills, just the news, relentlessly conveyed, and all of it bad.
US Treasury Secretary Henry Paulson now needs a new rescue scheme. Perhaps next time he might avoid using the word ‘bailout’, one which hardly masks the unpalatable reality that US taxpayers were being asked to come up with $5,000 each to help save denizens of massive financial institutions who wouldn’t blanche (in the good old days) at spending that sum on a night out. Or, as Stephen Harris succinctly has it over at WealthBriefing: “Senior politicians and financial officials were not able to convince the voting public that bailing out Wall Street firms would not be a move to bolster the positions of fat cat bankers but was a necessary move to shore up the world’s economy.” Harris notes, however, that politicians on both sides of the fence in the US insist that “lines of communication are still open”, a statement curiously omitted from the headline coverage of all this by just about every UK newspaper.
Where’s it all heading? Blade is no economist, but he can say that Blade Towers was yesterday valued by an estate agent. It was bought precisely two years ago, and in that time it apparently rose in value by some £45,000, only to drop back somewhat, and then drop back again, so that now it would be inadvisable to put it on the market for anything more than the price at which it was originally marketed. As the agent remarked, “Anyone in my trade who tells you he’s doing alright is lying. We’ve all been hit very bad, and the market has got further to go yet. Downwards.”
Meanwhile, Ana sends me this piece from the New Yorker. At least, thanks to the likes of Mark Borowitz, humour is alive and well. If you think you’re too big for a bailout, read Borowitz’ piece – and think again.
Image from Sweep da Leg.
