'Intelligent discontent is the mainspring of civilization.' -- Eugene V. Debs

Friday, March 14, 2008

Calculated Risk: Keep Score While Rome Burns 

UPDATE: You have to go back to the banking crisis of the Great Depression to find a moment when the financial system as a whole seemed so close to the precipice.

INITIAL POST: Too busy to post anything at length, but the most important news of the week has been the continuing collapse of the financial institutions that provide the necessary funds, both real and virtual, through a myriad of sophisticated financial instruments, for the operation of the US economy and much of the global one.

Another hedge fund dies, a 21 billion dollar one that purchased mortgage backed securities with mind boggling 32 to 1 leverage, a major brokerage house is now on life support, surviving only because of a bailout engineered by the Federal Reserve Bank of New York and J. P. Morgan, and the Federal Reserve Bank of the United States intervenes, yet again, to prop up stock prices (what is it? the 3rd or 4th time in the last 6 months?), this time by providing 200 billion dollars in US treasuries to primary dealers in exchange for mortgage backed securities.

Any one of these events is worthy of a detailed, analytical blog post in itself, but I just don't have the time to keep up with all of it. But don't worry, Calculated Risk and Tanta over at the Calculated Risk blog do, and they are much more knowledgeable on this subjects than I am, so let me recommend it again for those who want to keep track of the runs scored and runs allowed in the continuing meltdown of the American neoliberal finance economy, as described on this blog here and here.

They post frequently during the day in response to events, and the comments are absolutely phenomenal, with some more radical than what you would encounter on political blogs, because some of the posters understand the relationship between the methods of crony capitalism and political power. It is, despite its absence of any overt ideological perspective, one of the most left blog sites around because the events that it examines are essential for any leftist to understand when contemplating the future of neoliberal capitalism and the American Empire.

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