McCain is gonna win

8 10 2008

When your economic news comes choc full of epithets that remind you of circuits training, then your economy truly is in a pickle. Staff at Bobballs have been reading an awful lot of articles on crunches, downturns, tightening, heavy-lifting etc etc. Exhausting stuff.

So what a pleasure it was to bump into Jeff Randall’s piece in the Daily Telegraph. One reason to be cheerful.

Dick Fuld was head of Lehman Brothers. When his last bonus came through, he was in the gravy. What the hell, he thinks, who needs 40m bucks today? So do the share swap and watch it grow for tomorrow, right?

But as Jeff points out:

In the end, he was sucking up his own exhaust. He took his last year-end bonus, about $40m, entirely in shares. They went down the drain with the rest of his bank. Before this mayhem subsides, much treasure and many more egos will follow. The comedians await.

Combining the schadenfreude money shot alongside some serious, illuminating and precise insight is a unique skill. Nice work Jeff! But moving from that to this caused considerable concern here at Bobballs.

If Robert Reich is correct and we’re entering the Era of Angry Populism, is that the Era of Obama (community worker who penned a Freudian confession entitled Dreams Of My Father)? Or is this the Era of McCain (uncomplicated, salty, anti-establishment)?

As Paulson, Darling et al play tic-tac-toe with banks, Fuld becomes the first of capitalism’s big beasts to endure the stocks of televised committee hearings. The FBI are on the case now too. The sideshow of humiliating the fat cats is so easy to indulge when we’re all getting pinched.

The teaser on how successful the central banks are in regaining control will play out on the stock markets today, but then full matinee event – the great articulation of angry populism – comes next month at the US general election.

McCain was thought to have a blindspot on economics. Knowing the difference between an average cost curve and Phillips Curve means shit when real people get really angry.

Set fiscal plans of each to one side, how will the psychology of recession play out in the States? How do you peddle hope in this climate? Hope is something taxpayers had before $700bn gets paid out to capitalism’s rich money men. Voters have exchanged hope for taxes.

Poor taxpayers. We had debt through credit supplied by bankers in the boom, and the (housing) assets we all invested in are now next to unsellable. Still, we can always look forward to increased taxes to fund unplanned government borrowing to bail out dodgy bankers in the bust.

So I think Robert Reich is correct. The Era of Angry Populism is here. And I don’t see how the liberal lawyer is a better fit for the public mood than the pugnacious war hero with an open distrust of Washington policy-makers. He hesitated when the deal first emerged. So did most of America. McCain is gonna win.

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8 10 2008
Michael Shilliday

I might text you more often if it spurs you to blog.

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