1) Bailout
What I find interesting about the whole process is how many genuinely good ideas have been floated out there. It seems to me this is not just a chance to reestablish the markets, but to strengthen them the the point where this type of crisis can be avoided in the future. And between Galbraith, Roubini, and the historical analogies in other crises, there are extremely effective ways to do both that a structured well from the government's financial standpoint. I hope, if anything, all this mayhem leads to one of those, because the combination of financial fear and populist outrage could theoretically be pooled into some really constructive legislation. At the very least, it looks like we're past Paulson's invincible, one-dimensional, 700 billion zero oversight loc.
Basically, what I'd like to see is a wide net, including both the RTC angle, as well as raising the FDIC limit an increase to the FDIC fund, then a fund to do a preferred share recapitalization when necessary (including preferences over bonuses), a homeowner's debt reduction fund. Then, you tack on the basic limitations to keep things from getting out of hand. This would include Stiglitz's idea to limit bonuses to SEC registrants to longer term earnings, and to have a small set transaction fee on trades, again to encourage long term positions rather than short term churning BS.
I don't think we'll get anything that far reaching though.
2) Horse Race
Looks like Obama is starting to break away. Between the convention bounce dying, Palin falling apart, and McCain's insane theatrics, I can really only imagine the gap widening.
Sometimes it's just funny to see how sad and predictable the whole process is. Palin was picked and most people who looked into it realized that she was a complete joke. Then she gave a good speech and the base was willing to overlook the fact that she's a joke and acted like a bunch of goddamn marionettes. But fortunately it's tough to hide being a completely clueless, zero-capacity, ideological thug.
It's also interesting how McCain's entire campaign, beginning to end, has revolved around a bunch of stunts and theater. For all the "straight talk" and "experience" and "Obama's just a good speaker" the man literally has nothing to run on other than cheap stunts. He doesn't get any basic economic concepts, Obama's foreign policy positions are being validated one at a time on a weekly basis, so look at what we're left with. A ridiculous call for ten non-debates, in a desperate attempt for free air time. An insanely stupid and random VP pick done to "shake things up" in exchange for the well being of the country if heaven forbid the man actually wins. A "cancellation" which isn't a cancellation, as if McCain was not only the chair of the finance committee but also the WD-40 that kept congress moving. And now he's playing with fire and trying to exploit a very real, very serious crisis.
