A WILD RIDE

Two of my children, and some of my friends, have called to ask me if I am worried about my money. Well, yes and no. The current "crisis" is much exaggerated and politicized. The government must act to maintain liquidity in the market place, a reasonably stable currency and the underlying faith in the capitalist system. The failure to inject sufficient liquidity into the markets in 1929 by the Federal Reserve was one of the things that made the great depression so bad.

On the other hand, the resultant volatility has stopped me from making certain adjustments to my holdings that I had planned for this time of year. And October is traditionally the worst month of the year for the markets. What bothers me about the proposed "bailout" is that there is nothing in it to end the addition of new bad credit to the mix. The president or the secretary should immediately cut of the guarantee of any loan where the borrower does not reside in the property, end new sub prime guarantees and political contributions from any company involved in the "rescue" or their officers. Now I hear that the politicians are taking about adding relief for auto loans and credit card bills. There is more but I don't have time or space to go into it. My point is all the bad things that are included in the current package. It provides relief for many of the people who caused this problem and don't deserve relief.

As for the long term, the Federal government should make money on this package. The loan to AIG is at Prime plus 11 1/2 %. If you can't make money on that, you don't deserve a government job. When Clair went off to college I had to sell stock on the day the Dow was 750 to pay Georgetown. Those who complain because the stock market is down from its high of last year have no sympathy from me. I am still richer right now than I ever thought I would be.

In the long run I think everything will eventually work out AS LONG AS THE GOVERNMENT BACKS OFF AND LETS THE MARKET WORK ITSELF OUT.

While McCain is clueless when it come to macroeconomics he can spot a crook when he sees one. He has been a sponsor of several attempts to reform the system so that this debacle would not happened. These were blocked in the Senate by the very people who are now blaming the republicans for the results. McCain predicted what would happen on the floor of the Senate in 2005. The reform bill never came to a floor vote because of a straight party line vote on a "procedural" issue.

Obama, on the other hand, has a very good understanding of economics according to Marx and Engels and would impose those on the nation.

I fear for the country.