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Wednesday, 24 September 2008

I was wrong...

... in underestimating the necessity of politicians to all get their hands on the $700bn bad bank bailout bill. Congressional leaders, Committee Chairs, regulators, the media, sponsors, opponents, the McCain v. Obama star billings, Bush, G8 and EU leaders, our G.Brown, are dropping all other engagements for this one, the biggest global political event since 9/11 or the invasions of Afghanistan and Iraq, Diana's funeral, or the the end of Soviet Communism, the discovery of HIV/Aids, or the 6 day war, the Cuba Missile crisis, the surrender of Japan, or the Teheran Conference, bigger than the Olympics, and so on. Washington is full. Literally, thousands of security men everywhere, and there too the tipsters and market scouts looking for any rumour good or bad enough to trade on over the next days. McCain set the deadline of 1st October, 7 trading days hence. These may prove as dramatic in the markets as all of last week? Give politicians a deadline and they will take it to the wire for maximum drama. It may be a test of insider trading law to determine whether information given out privately, not publicly, by those closest to the negotiations may be a criminal offence?
The opponents of the bailout may debate the proposition of whether this is good use of taxpayers' dollars, but the regulators and the foreign leaders have ready answers for this. The remaining sticking point therefore seems to be how to ensure that Wall Street's bonus earners, or at least those who supposedly got us all into this mess, do not get paid or saved. $700bn and the £trillions for Fannie, Freddy and AIG must have their political price, the cost of which to banks, pensions, savings funds, investors, property prices, hundreds of executives who face prosecution, or even God or Mammon help us, the survival of capitalism, this too, all will be risk weighted, collateralized, securitized and tax liability calculated.

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