I can't speak for the original poster, but in my view, regulatory oversight is different than intervention. Minimal but adequate oversight is necessary. (ahh, but what is adequate oversight...) To me, it is common sense to require limits on margin. But if you blow that, you can't call "time-out" and give preference to some and not others and expect the market to operate in a fair and efficient manner after that. Point taken, though.
How about clean, efficient, and SMART oversight? Let's face it. Sarbanes Oaxley has done nothing but sent capital overseas. Other than that, it has not protected the market place as intended. Problem is, we are on the precipice. This won't be a "plain-vanilla" recession. Not even close. And given some of the comments that Congress has made during Bernanke's Q&A session today, our leadership has very little clue, because they don't fully understand how the financial system works. The banking system is frozen. If you don't believe me, take a look at the commercial paper market and case in point: AIG. CAT. 1-month T Bill rates went NEGATIVE today!
How am I at fault for that? If I was in a power to ensure that market failure through the crimes and manipulation that was occurring could have been stopped, I would have acted. What am I supposed to do now? Support this joke of a plan that is taking massive amounts of money out of my pocket when they are overstating the risk and there's not even a remote chance this government endeavor will work? It would appear you have WAY more faith in Paulson, Bernanke & Co. than do I, Landis.
I don't believe for one nanosecond that Bernanke and Paulson are OVERSTATING the risk of what is currently going on in our Economy. Do you realize that 1-month T Bill rates went NEGATIVE today? And yes, I do have confidence in Paulson. He's made a career out of making money. I think that he is putting on a "trade" ( making an investment ) that in the end, is going to wind-up making money for our economy, and the American people. Do you really think that it is worth allowing the U.S. Economy to go off a cliff because of 5 million homes, mostly domiciled in California and Florida? Warren Buffett seems to be thinking along the same lines as me. Time will tell.
and what evidence do we have that $700 billion of additional debt will do anything? I believe that 5 trillion number is much more plausible. (its the subject of another thread running at the moment). Although Berny and company are smart guys, they have gotten everything wrong so far. Subprime probs won't spread, etc. No, I am not a fan of this bailout, and I bet its over a trillion by the time they are done. Yes, I prefer a market collapse, and then just get going again from scratch, as in my opinion, this will get dragged out for years this way. Homes won't drop to where they should be, etc. Just my opinion.
Time will tell. And, oh how the mighty have fallen. Buffet has been making some of the worst investments of his career lately, and he's admitted as much. I wouldn't just look to Buffet's opinion as a vote of confidence as to the integrity or soundness of this plan. As to treasuries, that's more a sign of panic in the markets, rather than a signature of the level of true fundamental conditions (as bad as they may be), IMHO.