Browsing the blog archivesfor the day Tuesday, April 27th, 2010.

Financial News

Obama Administration

As predicted, Republican Senators, plus DINO Ben Nelson, voted as a block yesterday to stop financial reform legislation from going forward. Alexander Bolton reports for The Hill that Harry Reid is scheduling more votes on financial reform and daring Republicans to keep filibustering.

Bolton writes that “Reid also voted against the motion because of a procedural technicality” that will allow him to bring the measure up again for consideration. So if any wingnuts are saying “Reid voted against it, too,” that’s why.

Brody Mullins writes for the Washington Journal,

For the first time since 2004, the biggest Wall Street firms are now giving most of their campaign donations to Republicans.

A Wall Street Journal analysis of 12 large financial services companies, including J.P. Morgan Chase & Co., Goldman Sachs Group Inc. shows that they have collectively made $1.4 million in political donations, with 52% going to Republicans so far this year. That’s a reversal from last year, according to the most recent round of fund-raising reports covering January, February and March.

Apparently David Brooks wrote a column about the latest revelations from the financial crisis. I haven’t read it, but Kevin Drum writes,

Brooks has the causation backward here, I think. The establishment didn’t miss the housing bubble because of generic groupthink. It missed the housing bubble because of a specific case of groupthink: the nearly unanimous belief that markets can’t be wrong. Thus, if the market price of housing is going up, it had to be the case that housing prices should be going up. All that was left was to invent reasons to explain skyrocketing property prices, and the establishment did that in spades. But it was market delusion that drove establishment delusion, not the other way around.

Righties speak of “the free market” as if it were a natural ecosystem that will always right itself if mankind (the government) doesn’t interfere. And this is the foundational financial delusion. “Markets” have no existence except in the plans and machinations of human beings, which means they don’t inherently do anything. Put another way, “markets” are simply an effect created by humans, and everything that happens in markets happens because a person or people caused it to happen. So markets are as sane, or as crazy, or as wise, or as deluded, or as thrifty, or as greedy, as the people actively taking part in them. One can find certain behavioral consistencies reflected in markets, but this is because there are certain behavioral consistencies in humans.

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