Fed's Bear Bailout Hobbles Free Markets (Bear Stearns, J.P. Morgan, Citigroup, Goldman Sachs, Lehman Brothers) at SmartMoney.com
When I heard about the Bear Stearns bailout on Friday I was flying back from a meeting in San Francisco and while I hadn't heard the details, I didn't like the sound of it.
Under the banner of "Too Big Too Fail" the government once again stepped in and slapped the face of every American by bailing out a company that screwed up. A company that took on to much risk precisely because they KNEW that if their bets turned out to be wrong, the government would step in to bail them out......they were right and now you and I will pay the price instead of the shareholders and financial institutions that lent them capital.
The arguement was that if Bear Stearns failed it would take down the economy - that is just ridiculous. It was simply an excuse to violate our freedoms and confiscate more money from taxpayers to keep the vicious circle of financial institutions taking on too much risk going for another round.
The article I linked to probably says it better, but it goes into how the government bailout of Bear Stearns is in an ironic phrase, B.S. (get it Bear Stearns initials are BS.....I always say never trust a company with BS in its name).
We've got a long way to go with the current crisis, but at the end of the day we will recover from it and the economy will soar to new highs, the question remains will it get to new highs based on good fundamentals or based on institutions taking on more and more risk that they know they'll never have to actually bear.
ScottyD
