drieuxster (drieuxster) wrote,

Proof Liberals Do Not Understand Economics

Q: Why don't banks, investors, and other financial intermediaries think they are worth very much?

A: Six factors: (a) the housing boom was accompanied by the creation of a lot more assets--principally mortgage-backed securities and their derivatives. As supply and demand dictates, when there is more of something, it is worth less; (b) some of these securities were initially sold at prices that only a fool, thinking a bigger fool would come along to buy them at an even higher price, would ever pay; (c) there is a recession on and so firms have a greater chance of defaulting on their securities; (d) traders working for Wall Street firms are irrationally panicked after having been hammered for a year and a half; (e) those working for Wall Street firms that are now undercapitalized (because they have been hammered for a year and a half) assign a very high cost to risk because it materially increases the chance that their firm will vanish next month; (f) the risk level of these securities is much higher than normal because professional investors no longer trust their own financial models or know how their models compare to the models of other traders...

[ cf The Revised, Extended Geithner Plan Catechism ]

Not one Mention of the War President keeping us safe From Gay HomoZeXual Marriage Agendanista!!!

Not One Mention of the MexiCanadianist Darkies and their Zionist Bolshiviki Banking Konspirakii!!!

Not so much as a single reference to the argument from Divine Comedy!!!

Clearly these Evil Liberals just do not understand complex issues like why TinkerBelle is feeling tepid.

Clearly ONLY when the Government restores the True Faith in "Mark To Fantasy Island" will the economy take off again and all of the happy cargo cultist chant:
De Plaine!
De Plaine!
as they go about their happy ways.
Tags: economics, republican_pron

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