Archive for September 15th, 2008
Fed Gets High Marks On Lehman Brothers Reaction
Steil
Analysts at the Council on Foreign Relations are applauding the Federal Reserve’s decision to not bail out Lehman Brothers as it inched toward insolvency.
CFR Senior Fellow Benn Steil notes that, unlike Bear Stearns, which unravelled very quickly, Lehman Brothers came apart slowly.
“It was absolutely the right decision of the fed and the treasury to not step in … and to let them go,” he said.
Noting that central banks in South America and Asia got into trouble bailing out financial institutions there, Steil argues that a Fed intervention would have been dangerous.
“If the Federal Reserve takes on too many unlimited liabilities on its books,” he says, “…it could be in the same situation. We may see the same sort of reaction here that we did in developing nations.”
CFR geoeconomics expert Sebastian Mallaby adds that the Lehman Brothers collapse could affect New York City in the long run.
“New York’s position as the preeminent global financial center,” Mallaby says, “is potentially at stake.”
Blame Game Underway Over Lehman Brothers Collapse
News crews camp out outside Lehman Brothers Manhattan headquarters
It is, of course, a political year. So it’s time to start pointing fingers of blame, and positioning oneself to take advantage of the collapse of Lehman Brothers. Especially if one’s name is Barack Obama.
During a campaign stop in Colorado today, Obama charged that the Bush administration’s financial policies have led to, “the most serious financial crisis since the Great Depression.”
Of course, Obama is promising reforms to avert a recurrence. So too, to his credit, is John McCain, who told supporters in Florida that his administration would “clean up Wall Street.”
All of this, of course, is little consolation to the more than 20,000 Lehman Brothers employees worldwide, most of whom are spending what may be their last day on the job.
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Photo credit: Gary Baumgarten
Hurricane Ike Damage, Obama’s Slipping Numbers, Topics On Today’s News Talk Online
National Guard rescues woman, pet in Louisiana
Live eyewitnesses damage reports from the areas hit by Hurricane Ike will open today’s News Talk Online on Paltalk.com. That will be followed by a damage assessment of another kind. The wounding of the Barack Obama campaign.
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Lehman Brothers Fall Bad For New York
The fall of the nation’s fourth largest investment bank bodes poorly for New York City.
Lehman Brothers employs some 2,000 people in New York. It’s believed that at least half will soon be out of work.
The bank also occupies more than 20-million-square-feet of office space in Manhattan.
The record bankruptcy follows an 11th-hour weekend attempt by the feds to find a suitor to bail Lehman Brothers out. An attempt was made to create a partnership with Bank of America But BOA instead decided to buy another ailing investment giant, Merrill Lynch, for some $50 billion dollars.
Former Fed chair Alan Greenspan, who is known for his understatement about the nation’s financial status, said on This Week on ABC that the United States is facing a “once-in-a-century” financial crisis.
There’s a saying here in New York. How Wall Street goes, so goes New York City. Mayor Michael Bloomberg, no slouch when it comes to understanding finances, will likely come out with belt tightening measures. Hopefully the city, and the nation, will be able to weather this financial storm.
Photo credit: http://www.flickr.com/photos/zilpho/164270827/
Obama Supporters Show Concern
Slipping in polls
Obama supporters in the Mainstream Politics room on Paltalk.com were acting like rats on a sinking ship today. Arguing with one another for hours over the best tactics to get the Barack Obama campaign back on track.
The Republicans in the room were openly laughing and mocking them. If representative of the mindset of Democrats across the nation, today’s display is not a good sign for Obama. Not at all.
Of course, Sarah Palin’s name was mentioned far more than John McCain’s. Another reason to make the Republicans smile.
One McCain supporter, mocking the mostly Democratic online crowd, told them how happy he was that they can’t attack Palin directly for fear of being viewed as bullies picking on this woman, this mother of five children.
Well, excuse me. Palin is, after all, running for the vice-presidency. So why should the political gloves stay on? The Republicans never showed such concern for Hillary Clinton. Why the double standard?
Oil Platforms Destroyed, Gas Price Increase May Continue
Prices up
Although it caused less damage than had been feared, federal authorities say at least 10 oil platforms were destroyed in the Gulf of Mexico. Leading to concerns that gasoline prices, which spiked $1.50 overnight, may remain high for some time.
Pres. Bush says the federal government and state governments are investigating allegations of price gauging.
Meanwhile, in many areas of the nation, gasoline is reportedly in short supply. And lines at stations are long.
A Baumgarten Report observer in North Carolina reports no gas available at some stations. A CNN reporter in Georgia tells us gasoline is plentiful in the Atlanta area.
