C.M.O. 3.26.2009
March 26, 2009
The pundits have been searching for capitulation since after Bear Stearns collapsed over a year ago and while still not evident in the indexes the 48 hours that encompassed Tuesday and Wednesday could well have been the equivalent if there was a measure for populist sentiment.
With all of the vilification those in the world of finance have received for assisting Congress in it’s quest to have every person in all 50 States own a home regardless of whether that was a prudent goal, given the pertinent economics, no one had cast the white light of truth on those on the dais.
No one until the people at the Essential Information and Consumer Education Foundation produced a recent report titled “Sold Out”. It has not been possible to read the entire page report since first learning of it and this writing, but I will share with you a few fun facts:
From 1998-2008 the financial sector comprising the finance, insurance and real estate industries, contributed a total of $1.738BN to various political candidates. Additionally the group spent $3.3BN on officially registered lobbyists.
This was made up of $154MM in campaign contributions and $383MM in lobbying by Commercial Banks, $81MM and $122MM in those respective categories by Accounting firms, $220 and $1.1BN by Insurance companies and $512MM by Securities firms.
These numbers flowing from Wall St. to Washington do not exonerate the former in any way but just as important they provide at least a reasonable base from which to question whether those doing the skewering on Tuesday had not feasted on the spit-roasted pig themselves.
I quoted a line from Shakespeare’s Hamlet earlier this week with regard to the AIG mess but now it appears the age old advice that “people who live in glass houses should not throw stones” might be more appropriate.
It is hoped that Mr. DeSantis’ letter of resignation will once again allow all parties involved to focus on the real problem at hand and for a clue as to what that is we need only to remember the catch phrase from Bill Clinton’s 1992 campaign. “It’s the economy, stupid”
One more wake-up.
Jim Delaney
Labels: CDS, CEC Strategy, correlation, credit, cross asset, equity, Jim Delaney
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