|Capital abhors the absence of profit or very small profit as nature abhors a vacuum. With the appropriate profit, Capital becomes bold. With a guaranteed 10 percent, it's readily available; at 20 percent it gets lively; at 30 percent it's positively daring; at 100 percent it will trample on every human law; at 300% there is no law it won't risk breaking, even at the risk of the gallows; at 600% it will climb over mountains of corpses and trample every manifestation of human decency into the earth. K. Marx|
e can thank the NY Times this morning for exhibiting the "full spectrum response" of the Apostles of the Free Market when their latest financial trick goes sour. The appended Times article and especially the rant by the Free Market evangelist Jim Cramer that came with it is a treat not to be missed.
The implication of the Times' headline, namely that the Federal Reserve has a mechanism for propping up the stock market, is profound.
The cause of the rant, the impending collapse of mortgage-backed securities, is less important than the exposure of the hypocrisy of these apostles which is in the same class as the pederasty of the guardians of virtue in the Catholic Church.
Here's the link to Cramer's rant (YouTube):
Free Market apostle rants for Federal Intervention
The appended NY Times article by Mike Nizza is more restrained, but they both want the same thing:
WE are supposed to bail THEM out.WE won't, but THEIR dictatorship will, at OUR expense.
August 7, 2007, 9:38 am
A Volatile Market Turns to Bernanke
Amid signs of a weakened housing market, slowing consumer spending and wounded banks and hedge funds tied to subprime loans, the Fed’s chairman, Ben S. Bernanke, was expected to keep interest rates unchanged today, but to lay the groundwork for a rate cut next time, according to Bloomberg News, which divines a possible strategy:
By changing what it says, and not what it does, the Fed can show it isn’t oblivious to the 7 percent plunge in stock indexes since July 19 and the possible impact that could have on the economy. At the same time, the Fed can avoid being seen as losing its anti-inflationary zeal or as standing ready to bail out investors.
The Fed statement is due out at 2:15 p.m. Eastern; the reaction is due out seconds later. If rates indeed remain unchanged, some investors will not be happy. Jim Cramer, the dean of his own school of frantic financial commentary, was, by leaps and bounds, the most vociferous of them. Dealbook described the crazy scene unfolding on CNBC yesterday:
Less than a minute into the segment, he explodes, accusing Ben S. Bernanke, the Fed chairman, of sitting on his hands and not cutting interest rates when such a move is sorely needed. “He has no idea how bad it is out there! None!” Mr. Cramer shouts at one point. As Ms. Burnett tries to calm Mr. Cramer down, suggesting that if Mr. Bernanke were to cut rates the markets would suffer Armageddon, he fires back: “No, we have Armageddon!” Even those familiar with a Cramer rant may be surprised by the YouTube clip.
Within the anger at Mr. Bernanke may also lie at least a little sadness that his legendary predecessor, Alan Greenspan, is no longer around to soothe markets in times like these. Mr. Greenspan’s ability to turn dry Fed statements into music to investors’ ears even has a name, as described by The Times:
The ‘’Greenspan put,'’ the term for the faith that investors had that Alan Greenspan, when he was the Fed chairman, would take the necessary steps to keep stocks from falling too far.
A Forbes columnist blames Mr. Greenspan and his put, not Mr. Bernanke, for the current troubles. “Our present misery dates back to Alan Greenspan’s easy money policy of a few years ago,” Martin T. Sosnoff wrote.
Wall Street is eagerly anticipating the sound of the “Bernanke put,” and there’s been no more potentially defining moment than today. But analysts quoted by Bloomberg predict a much less friendly sound. One chief economist said Fed officials “really want to stay away from the Bernanke put.”
We’ll see how successful they are later today.