Dissent Of The Day

Re: Geithner, a reader writes:

If you look at finance stocks somebody is doing something about the banking crisis; the investors. The losses in the DOW on Citigroup, B of A, American Express and JP Morgan are indications of an open free market undoing what the “greater fool” market of  the last thirty years created. The longer the government can stall the better.

Investors can’t claim the government owes them anything when their stock has no market value. Creditors can’t hold out for higher payments when the market has determined insolvency. At the same time some institutions, Wells Fargo for instance, are gaining position and demonstrating stability as their comparative past prudence allows them to weather this storm.

Once we nationalize, no matter what we call it, the first institution all the other institutions will have added instability. The longer we give the market to identify the institutions that are dead the less damage we’ll do to institutions that are only in pain.

Free market capitalism isn’t dead and President Obama doesn’t want to kill it. It seems obvious that the world’s financial system has become so infected with deluded thinking and fraud that there is no reliable information on costs or risks. A free market requires open disclosure and diligence which has been gone for years. I don’t know what to call this thing that’s in a coma on government life support, but it isn’t free market capitalism.