Dan M <[EMAIL PROTECTED]> > Now, you can argue that Sears and Ford are questionable, but GE? The point > is that the liquidity of the market was drying up. And, at
No, the liquidity of the market was not drying up. Interest rates went up. As they should. As they should have long ago if there weren't so much government interference in the market. > Or, just take how I'm affected. If Fanny and Freddie went under, the place > where roughly half of the mortgages end up is gone. So, it's much harder to > find a mortgage, which drives prices down, which means more houses are under > water and now bad debt, etc. Home prices should be driven down. FNM and FRE, with their wrong-headed government charters and guarantees, inflated housing prices for years. They still have a ways to go down before they reach something closer to long-term equilibrium. > The natural tendency of business (which we saw as the short term liquidity > started to dry up on Wednesday) is to hunker down during bad times. That's > why even GE had trouble selling short term debt on Wednesday. Yes, when insolvent companies are kept in limbo by silly government interference, the market does not behave efficiently. Big surprise, that. > " Traders said most lenders were unwilling to extend credit beyond a single > day." > > That looks like the start of a panic to me. I'm not sure what you'd call > it. A useless generalization. Naturally, anyone who cannot borrow because their balance sheet is full of an unknown amount of toxic waste is going to complain and make things sound dire if it will help them to feed at the taxpayer trough. _______________________________________________ http://www.mccmedia.com/mailman/listinfo/brin-l