Last week the Dow Jones lost 18% for the week, the worst one week performance in its history.Over the weekend, European Central banks announced a plan to partially nationalize bank losses and guarantee loans between banks as well as allow governments to buy stocks in distressed financial firms.
The United States is expected to follow suit, with the government taking equity stakes in "healthy" banks and financial firms while continuing to provide funds to buy up "illiquid assets" (i.e., crap that nobody in their right mind wants to buy because they don't know what the worth is.)
Wow - it's Bank Nationalization Day everybody - if you're a big financial firm and you've either lent out money to people who can't or won't pay it back or bought up securitized debt from same said people, the government has got some money for you!!!
In other words, don't worry about your losses, taxpayers and/or the government printing press will make them all magically disappear.
And how did the stock market react to the bank nationalization news?
Why, it gained 11% in just one day, almost 1000 points.
Down 18% last week, up 11% today.
As Atrios would say, wheeeeeeeeeee!!!!!!!
Funny thing, though. These same "capitalists" and "free market proponents" who applauded the bank nationalization moves today buy buying up nearly every stock in sight consistently scream holy terror whenever anybody talks about a national health care system in this country.
You see, national health care is "socialism". The Bush administration buying up trillions in crappy assets and debt obligations and pawning them off on the tax payers while saving the backsides of all these Masters of the Universe on Wall Street - that's just free market capitalism getting a little help from the government.
It's a shame the same permabull hucksters who helped create this mess (turn on CNBC any time of day and you'll see 'em) won't admit the irony here.
But Barry Ritholtz at the Big Picture found it though:
Who ever would have predicted a quip such as this one 8 years ago:
“The Bush administration, which took office as social conservatives, is now leaving as conservative socialists.”
-Allan Mendelowitz
These are truly interesting times . . .
Indeed they are.
Well, at least the guy in the picture can get work down on his Lexus now.
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