The Dust Bowl That Almost Was

Does anybody remember Sept 19 2008? This was the day that 3 great men prevented another world wide dust bowl of epic proportions.This one would have been much worse then the great depression. The private intel industry uses the word classified and words like dark and black ops on a regular basis. Wall Street is no different, in fact their world is so secretive  that in the years that led up to the financial crisis a very small percentage of people even knew what a credit default swap was or what a collateralized debt obligation meant and how this was all so closely linked to the credit agencies, our major insurance companies and government sponsored  mortgage back security houses like Fanny Mae and Freddy Mac. This is a world dominated.by fear and greed,.various traunches  caused such systemic risk across the globe that it would be months after the bail out before the black box and dark world of wall street became widely known. The Titanic was supposed to be unsinkable and remember when the Twin Towers was supposed to be able to take a direct hit from a jet liner? Well Lehman Bros was too big to fail and everybody knew this as well. Many people criticize our govt for being big brother and for being the spy in the sky however a Laisez- Faire hands off government position is what actually led to the meltdown to begin with. We were champions of the free market and this is the reason Hank Paulson our Treasury Secretary decided not to bail out the biggest casino on wall street Lehman Bros. He was a firm believer in moral hazard which meant any government intervention would create zero incentive to learn the error of their ways. The next question is why bail out Bear Sterns a small time player and not a behemoth like Lehman. It was a clear message that capitalism rules, sink or swim, we will help you just this one time but  never again.  It is important to note this time in history because this was as serious as the 13 days of the Cuban Missile Crisis. This was the closest we ever came to nuclear annihilation and JFK saved us all  then as well. Hank Paulsons decision not to bail out Lehman Bros was just as serious. .Paulson  single handedly practically pressed the big red button, this was Sept 2008. After Lehman went down so did the world markets and AIG even bigger then Lehman started crumbling right down behind them. Merrill Lynch was next on the list and from there on it would have been like domino's. There was world wide panic, the credit markets were frozen, the Dow went into a free fall and absolutely nobody knew what to do. What makes this a great story is that Paulson adapted immediately and stepped up in a big way along with Bernanke and Geitner to save the entire world as we knew it.. On Fri Sept 19 2008 these three men went straight to Capital Hill and made it very clear that unless Tarp was initiated a 700 billion dollar infusion to our major banks there would be no economy by Monday and we all now know this meant for the entire globe as well.. They did what was needed to be done and all of the bureaucrats revolted like anarchy and the CEOs of these banks were not pleased either along with most of the American people. Now we can all look back and say this wasn't a socialist act at all this was three American heroes saving the entire world from certain economic annihilation.