Now That Bank of America has Rescued Countrywide, Who Will Rescue Bank of America?
JUST KIDDING! Can't you guys take a joke?
Well...actually...we think we'll let the question stand. Situation brings to mine the question an old friend of ours used to ask when the Reform movement in the Democratic Party was hard at work, trying to reform that entity. "The question now," our friend would say, "is who is going to reform the reformers.?"
The BoA "rescue" constitutes the expression of the JP Morgan principle, we think. Morgan realized that if anyone was going to save the system in 1907, it would have to be him. Consequently, he acted. Of course, he was not hobbled by the need to hold a meeting and achieve a consensus on every point, nor was he hobbled by a bureaucratic mentality which led him to shy away from decisive action. He was a leader, and he had an independent base.
The FED is very different. In fact, the FED reminds us of the high command of the army of Louis XIV. The sun king's smallish army had more than 1,000 generals. Still, Louis was the boss. That is what is so sadly lacking at the FED, a boss. Unfortunately, the leadership vacuum is protracting the current credit market crisis
Well, perhaps we should look on the sunny side. The longer the Fed defers decisive action, and the greater the economic damage, the longer and farther down rates will fall, and the higher the bull market in equities will ultimately go.
That, at least, is how we see it.
- moneysage's blog
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