Perhaps they sized up the situation, and saw that they could not take too many radical steps at the outset --and passing three-quarters of a trillion dollars as a stimulus package is a radical step-- and thus on this banking crisis they were going to use the failed approach for a little while, until its inadequacy becomes so clear that people beg Obama to do what he already knows he has to do, which is to do what Krugman et al want them to do.
----- PAGE BREAK -----By waiting till there’s a clamor to nationalize, Obama becomes less vulnerable to the Republican “Socialist” smear they’re so eager to apply. He takes the necessary radical action without being discredited –in the still-reactionary American political consciousness—as radical.
But that's just a scenario I invented. I don't know how plausible it is. Meanwhile, I could use reassurance that it isn’t that Obama and his gang are just misguided.
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But even if that’s what’s happening, I get the feeling that the time to shift must be near at hand.
Time is not yet on our side. With every passing day, damage –some of it probably irreversible—is being done. I hear that International Paper just died yesterday, the cause of death being the refusal of its bank to renew its line of credit.
Things seem to be worsening at an undiminished rate. Indeed, some things are going the wrong way.
The LIBOR --the interest rates that banks charge each other-- had been coming down in a reassuring way. But I heard on NPR today that for the past few weeks they've been "creeping back up."
That is a measure of fear. The fear is increasing.
The market is also a barometer of fear, versus confidence, and its continued plunge also shows that the level of fear is increasing.
When fear is getting stronger over the weeks of Obama’s implementing his policies, that’s not a reassuring sign.
If Obama understands that ultimately something stronger is needed, it would seem that “ultimately” should be about now.
Reading about the financial crisis the other day, I got the sneaking suspicion that perhaps the problems are beyond the ability of any leader with any policy to avert a catastrophic scenario. Maybe the wrong-ward movements of LIBOR and the stock markets represent not so much a condemnation of the Obama/Geithner policies than a spreading sense that the problem is to big to be “solved.”
Either way, it means that the confidence that Obama's solving the problem is decreasing.
But also, either way, I would say this:
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