Stocks enter the final hour about even. Import prices gained .7% in March, once again an inflation measuring metric is goosed by energy prices that jumped 4% during the period in question. Exclude this effect and import prices actually fell .2%. In fact much of the so-called inflation of late does in fact trace back to higher energy prices either directly or indirectly. As stated previously credit busts are inherently deflationary and this has been evident in the data for some time. The Trade Deficit reached 39.7 billion in February as imports have increased steadily since last summer outpacing the improvement seen in exports. Though they too have improved and these improvements have been a big part of the economy is actually recovering thesis.
The post mortem of Washington Mutual continues on Capitol Hill as our elected officials try to figure out just what happened. The pattern is becoming a familiar one. After the Inspector Generals issue their report on a failed bank we find that the regulators in the field did their jobs, identified problems and reported them to their superiors who then failed to act. This failure to act goes back to about 2003 and in fact if one goes over the history of this fiasco over this period you find a parade of warnings, failure to act, deliberate suspension of investigations both directly and indirectly that ultimately allowed the crises to build to epidemic proportions.
The question of course is why, they certainly knew better and where aware of the growing problems and yet did nothing until it was too late. Either the senior regulators were on the take, being coerced by there political supervisors or just plain lazy. Lazy is fairly easy to rule out, which leaves either corruption by financial industry lobbyists and their generously funded influential budgets. Or, political higher ups prevented appropriate action from being taken.
Given that to date we still don’t have meaningful financial reform nor has much changed, politicians facilitated the S&L Crises, LTCM Crisis and current crises through a parade of either inaction or legislation that was poorly considered and many warnings given that it would end badly, and did. A well-documented trail of directly and indirectly related lobbyist financed political influence. An almost complete failure to date to hold anybody of significance accountable for this fiasco or address the issue of too big to fail, in fact we have made them even bigger.
It seems to me that the most likely cause is deliberate political influence as politicians have clearly demonstrated through out these crises whom their masters are, it’s not the electorate. Worse their loyalties in many cases are obviously grievously skewed towards what they can get instead of what they can do for their country and its citizenry, as is their job description.
Hi and welcome to The Profit Motive, I’m your host Caleb Lawrence. Once upon a time in America the media acted as the watchdog of the corporations and the state. In the modern era it’s all about ratings and profits, opinion has been substituted for news and frequently is presented as fact. Much like my daily radio show on KPIG 107.5 FM in Santa Cruz California and KPYG FM 94.9 Cayucos/San Luis Obispo California. A thousand Blogs were able to spot the current problems and many began discussing it years before it reached crises proportions. While there were exceptions, and these exceptions are becoming more common, the mainstream media failed to get it and largely continue to do so.
