1. You two gentlemen have been wrong about the Housing crisis, missed the leverage problem, and understated the derivative issue. Indeed, you two have been wrong about nearly everything since this crisis began years ago. Why should we trust your judgment on the largest bailout in American history?

4. In the nationalization of AIG, the US taxpayer received 80% of the company. What is the taxpayer getting for their money in this $700B bailout?

7. In 2004, your former firm, Goldman Sachs, along with 4 other brokers, received a waiver of the net capitalization rules, allowing these firms to dramatically exceed the 12-to-1 leverage rules. How much was this waiver responsible for the current situation?


The business press is still trying to get its arms around the utter immorality and scandal that the credit crisis represents. Here’s the The New York Times’s attempt via interviews with economists.


“It absolutely has to be punitive,” Mr. Baker said. “If they sell us the junk, then we own the company. This isn’t a way to make these companies and their executives rich. This should be about keeping them in business so the financial system doesn’t collapse.”


The Times also offers a roundup of conservatives bridling at the bailout, which, they don’t seem to recognize, is regulation after-the-fact, sort of like fixing your car at 65 miles an hour:

Mr. Shelby, of the banking committee, said: “Congress must immediately undertake a comprehensive, public examination of the problem and alternative solutions rather than swiftly pass the current plan with minimal changes or discussion. We owe the American taxpayer no less.”

Mr. Gingrich, the former House speaker, said he expected Republican lawmakers to oppose the plan in increasing numbers. “I think this is going to be a much bigger fight than he expected,” Mr. Gingrich said, referring to President Bush.


Andrew Ross Sorkin makes a good observation about the bailout as proposed:

The passage is stunning.

“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency,” the original draft of the proposed bill says.

And with those words, the Treasury secretary — whoever that may be in a few months — will be with vested with perhaps the most incredible powers ever bestowed on one person over the economic and financial life of the nation. It is the financial equivalent of the Patriot Act.


Finally, the Journal is inadvertently funny with a story about counselors at business schools besieged by panicked MBAs.

“We’re like a tennis player on their toes,” she says.

That MBAs have to find another line of work, away from Wall Street, I’d say qualifies as the least of our problems and may be the beginning of a solution.

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Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014). Follow Dean on Twitter: @deanstarkman.