UnBearable: Reaction to Bear Stearns-JP Morgan Deal

I thought the rich guys were supposed to be good at money stuff. No?

I think the feds had to act. But, if they paid closer attention earlier would we have avoided a crisis?

Mike, I don't agree with corporate bailouts (along with most government intervention), I just find posts like Yakatori's hypocritical. I do think that the money we spend on bailing out the poor and stupid people far outweighs what we spend on the companies. And at least the companies create wealth, value, jobs, and pay taxes, most poor people never do any of those things.

You're about 20 years late on piling on the oil companies. Governments around the globe have direct (Venezuela, Saudi Araba) or indirect (Russia) control of their oil reserves that outstrip the oil companies. And unlike governments, oil companies spend much of the profits on capital projects to maintain their equipment and drill new wells. Venezuela spends their profits on social programs which while admirable means their production is falling. And most of the increase in the price of oil is because of the falling dollar, Wall Street speculators, and global tensions.

@JDSX: I'm far from being a kneejerk liberal, but there is a huge difference in the amount of money we spend on social programs and the amount we spend on propping up banks and providing corporate welfare.

I'm all for capitalism, but right now we're taking from the middle class to subsidize the hyper rich. That's a broken system.

"The economy is cyclical."

This could be structural.

You guys should pick up a USA Today, um, today.

I never read it but is the most in depth of what's going on than any other paper on the news stand today.

As much as I would like to see Bear Stearns loose everything, they are too involved with everyone for the feds to not try to stop this. $30 billion from a $3 trillion operating budget to prevent the meltdown of your economy is not a bad deal. Hope it works.

Thanks for this post and the link to USA Today's article. You finally explained what this Bear Stearns situation means for the common person, which is, of course, that we are screwed, too.

Yakatori:

You're making me get in touch with my inner Travis Bickle. You really hit the nail on the head.

It's funny Yakatori, but when I read your comment all I could think of was how often the middle class and rich pay for the mistakes of the poor. Every social program, every financial shoring up of some family or overbreeding baby mama, every bailout of citizens by the taxpayers, that's everyone else paying for the poor and the stupid (which is very often the same thing).

Remember back in 2000 and 2001 when the dot com bubble burst and the economy went to shit? Remember the same George W. that was (and is) in power that gave the Dow its highest level ever last year? Remember all the deal activity in the last four years? The economy is cyclical.

Its not just the NY Times saying that. Even The Economist was trying to figure out if we are officially in a recession or not. No one likes to use the R word unless they are certain thats what we are in.

Even mere rumors that we are in a Recession can cause companies to minimize their spending on new employees and make individuals to slow down their spending.

yakatori,

you took the words out of my mouth

matty,

the nytimes is getting shady...

the ecomomist is excellent, but im biased, i used to work there

I kind of like how not a month ago the New York times was like "what recession?" as if to say the rest of the nation can suffer but we will continue to purchase 40 million dollar condos - cause we're New York.

Now that Bear Stearns is belly up the time actually admits that a recession is here and here to stay.

Is it just me or is the times getting really flakey lately?

Time to switch back to the economist.

It's a wonderful world we live in isn't it. Where the middle class and poor pay for the upper class' mistakes. Bush dancing to the cries of the struggling. The Chinese brutalizing a whole race of people. Spitzer getting suck jobs while sending other poor saps to jail for the same thing. MOre overlooked genocide in Africa. Oil companies getting richer and richer.

Have we had enough already people? How much more abuse can the ordinary man take?

"...but now has decided to move into Bear Stearn's 383 Madison Avenue headquarters."

That was fast. It is a nice building though, nicer than their Park Ave Headquarters. The building itself is worth more than four times what JPMChase paid for the entire company.