Wednesday, January 27, 2016

Cheap shots, heels, and mountains of dreck

Yesterday I said something to the effect that Donald Trump was fearless, but I was wrong: as the Scarecrow had his terror of a lighted match, as Achilles dreaded an injury to his heel, so there's one thing the Donald fears: Questions from Fox News's ice princess.

Megyn Kelly. Photo by Alexei Hay/GQ, December 2010, via So that's what fuck-me heels are?
Amazing Conservative Logic of the Year:

I know it's still only January, but this from David Beckworth (Mercatus Institute) and Ramesh Ponnuru (American Enterprise Institute) in the New York Times is an instant classic:
Federal Reserve caused the [2008 financial] crisis by tightening monetary policy in 2008. While Mr. Cruz (who is an old friend of one of the authors of this article) has been criticized for making this claim, he shouldn’t back down. He’s right, and our understanding of the great recession needs to be revised.
It was those gol dern regulators again! And how did they do it? Well, it's a step up from the usual Republican argument that the crisis was caused by black people, aided and abetted by Fannie, Freddie, and Acorn. The authors may have gone to see The Big Short, and they recognize that uncertainty over the value of mortgage-backed securities and their derivatives in the shadow banking system was a problem:
This housing decline caused financial stress by sowing uncertainty about the value of bonds backed by subprime mortgages. These bonds served as collateral for institutional investors who parked their money overnight with financial firms on Wall Street in the “shadow banking” system. As their concerns about the bonds grew, investors began to pull money out of this system.
So the markets collapsed because of investors' concerns over the imaginary $650 trillion in derivatives contracts in a pyramid based on paper whose actual value, if any, was a completely impenetrable mystery maintained by the banks and rating industries? No, they were felled by the Fed failing to encourage those guys to keep their money in the derivatives market, and specifically the Fed tightening money by lowering interest rates:
It took a bigger shock to the economy to bring the financial system down. That shock was tighter money. Through acts and omissions, the Fed kept interest rates and expected interest rates higher than appropriate, depressing the economy. This point is easy to miss because the Fed lowered interest rates between September 2007 and April 2008. But raising rates is not the only route to tighter money.
Well, I guess not, but I'm pretty sure lowering rates is not one of those alternatives. And while you can certainly argue that it would have been better to lower the rates farther and faster, you can't argue that it was the Fed's job to persuade the investors that this unsustainable mountain of dreck could be sustained.

See the comments at the Times website if you get a chance, they're terrific and hilarious.

Ted "Keep My Daughters Out of This" Cruz brings his daughters into this. Though not, I'm glad to say, such a bad father as to leave them uninsured just to make a political point.
Obamacare Tragedy Watch:

Speaking of financial genius Ted Cruz, Susan of Texas walks you through the twisted subject of Ted and his lies on the subject of his family's health insurance.

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