I’ve been thinking about spotlights. Actually I’ve been thinking about “the 15 minutes of fame,” election 2008, Palin, candidate scrutiny, financial issues, Lehman, Merrill, AIG, FORD/GM, and the taxpayers’ soaking. Things are moving pretty quickly on the news story/crisis front. The Andy Warhol comment about “15 minutes of fame” now seems to refer to the TOP STORY coverage attention span given to the political or financial crisis of the (quarter) hour.
You see the spotlights barely have the chance to focus on the travails/problems of any one person, issue, or company before a bigger matter banishes the reigning media star from center stage back to the depths of the chorus line. The momentum of Democratic Presidential Messiah-hopeful Obama, was totally zapped by the aura of the waxing nebula of Republican Veep-candidate Palin the moment of her roll-out from de-hibernation as the unknown Alaskan Govern-ette. Whatever happened to Biden, or McCain in all this brouhaha? Or, who even cares at this point?
I can only hope that this current media scrutiny of Palin also sheds some spotlight time on the other “what’s his, his, or his name(s).” This major FOUR-some must be forced to share with the voting public how they will fix a nation with a broken economy, a broke workforce, and an imploding financial ecosystem in the remaining forty-nine days before the November elections. They don’t even have the decency to give US/us enough details of their own plan for America so that we can judge how they’d further screw things up. We are forced to listen to each respective opposition’s negative third party here-say of what the other team would (or would not) do without being given a point by point alternative.
The story of Freddie and Fannie from two weekends ago is now being eclipsed by this past weekend’s revelations that the giant Lehman Brothers was facing inevitable liquidation and that mega broker Merrill Lynch was being bought by Bank of American for $40 to 50 BILLION! Do even 5% of the American public even know who Lehman Brothers, or Merrill Lynch really are? I’d be willing to bet that in the case of Lehman Brothers, the public believes they are a discount furniture operation - who sold second rate household goods and appliances at premium lease-to-own payment pricing and were not America’s third or fourth largest investment banking firm. Merrill Lynch did enough news hour TV advertising that the public IDs them with some aspect of cattle ranching. So... what’s the big deal?
The “big deal” is that the banking, financial, and investment systems of the country (and the planet) are unraveling at an ever increasing rate. The “don’t worry, be happy, we’ve got the situation under control” mantra is finally being seen for the election year hooey that it is. The US Treasury and the FED’s broken-record response has been to print more money and to assume more obligations via guaranteeing value at taxpayer expense down the road. The “bait and switch scheme,” whereby by the FED would buy and warehouse (I was actually tempted to use the word whorehouse here) worth-less or worthless securities for financial entities at their booked carrying values to preclude write-down and forestall inevitable insolvency, will buy some time, but it doesn’t fix anything. Increasing liquidity for additional borrowing will not help those already drowning in debt. Besides who will catch Uncle $ugar when he goes into freefall. So far... Uncle didn’t offer a bailout or guarantee for Lehman or Merrill.
Prior precedents have spotlighted the US government as the generous benefactor of last resort in the high stakes game of “financial Armageddon chicken.” We are now hearing how insurance giant AIG has their hand out for an emergency $40 BILLION infusion. Meanwhile, General Motors-Ford and the auto sector wants a quickie $50 BILLION to tide them over. For the last five days... almost the entire lower 48 states have been drenched by a never ending rainstorm (which may or may not have been the result of Hurricane Ike). I’d strongly suggest that we are all following a roving spotlight on the never-ending sequential revelations of “15 minute crises” because it is the taxpayers who will endure the real soaking regardless of who is elected!
I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.
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This story was published on September 15, 2008.