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If Gold had been up another $100, yesterday’s dramatic
price action on U.S. and global markets would have felt right as rain. As it
stands, Gold rose a relatively modest $50 on subdued speculation that Paulson
is actually serious about bailing out every institutional lender on Earth who
holds bad U.S. mortgage paper. Under the circumstances, which verge on
hyperinflationary, we attribute bullion’s relative reticence not only
to the usual ignorance, but also to the false optimism fomented by such
high-profile demagogues as Kudlow and Suze Orman. Both reach huge audiences,
and that could account in some part for the fact that the Dow is still
trading above 10000 while bullion remains on the launching pad, belching
flames.
Not for long, as far as we can surmise from the charts. But
don’t expect everyone to experience the implied epiphany at the same
time. Two years after the stock market crashed in 1929, there evidently were
millions of Americans who didn’t realize the country was in a
Depression. If Kudlow and Suze had been around back then, they’d have
stopped bullets for Hoover until employment stabbed climactically above 25%.
Can we blame the punditry for thinking the current, totally fabricated, 6.1%
jobless figure is nothing to worry about?
Last
Remnant of Capitalism
As Rick’s Picks went to press, there were reports that conservatives were going
to try and block the mega-bailout, presumably so that a vestigial remnant of
capitalism might survive the crisis. But they are jumping in front of a
speeding freight train, as far as we can tell, and we’d lay 3-to-2 odds
that it is Congressional liberals who will prevail. Actually, we must admit
to being somewhat sympathetic toward their designs. Shocked to hear that?
Well, for one, the Democrats would rewrite the draconian bankruptcy code,
which effectively blocks most down-and-outers from starting over with a clean
slate. And for two, the Democrats are proposing that CEO pay and benefits be
reined in at companies that choose to be bailed out. Sounds reasonable,
doesn’t it? Paulson doesn’t think so.
But if Capitalism is about to go down the tubes anyway, which it
is, why not allow lawmakers on both sides of the aisle an equal opportunity
to share in the blame somewhere down the road? As for the candidates, they
should stop pretending they have the answers, or that the other guy’s
side caused the mess. Let them put the true perpetrator, Alan Greenspan, on
trial, and then get on with the business of resurrecting America from the
pyre.
Rick Ackerman
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Rick Ackerman is
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