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Sunday, December 7, 2008

Bailout Bias

One of the nice things about having a daughter that works at Starbucks is I can read the Sunday New York Times without paying for it (5 bucks! Are they nuts?). Nothing was particularly interesting in the business section, but there was a nice article in the Week in Review section (posted to their web site here). The gist of the article is whether or not there is a "bias" towards Wall Street when it comes to bailouts. I'm not in favor of the government bailing out anyone, but I find it strange that automakers, someone who actually produces a product, have to beg for amounts that are a pittance compared to what has been given to the financial system, with no oversight whatsoever. Banks were given taxpayer money, for the expressed purpose of having them lend it out to businesses and consumers, but since the banks were not REQUIRED to do it, they, for the most part, haven't. Instead, they have held onto it, used it to pay dividends, bonuses, and (in AIG's case) lavish retreats. The awful double standard, not only with the Treasury dept. (apparently a subsidiary of Goldman Sachs), but also with the pump monkeys in the media, who are constantly touting the financials (Cramer's infamous Bear Stearns call comes to mind, but everyone from Erin Burnett to Ben Stein have been pushing the financials all year), is almost enough for me to sympathize with GM, Ford, and Chrysler.

Even with the private jets.


Here's Don Harrold, saying the same thing.

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