Stormy Weather
I'm supposed to write one page on my views on the policy issue underlying the Fannie/Freddie bailout. I wanted to turn it in today, but no such luck. I've spent at least three hours reading up on it and probably the same amount of time actually writing the thing. I've got 3/4 of a page, after lots and lots and lots of trimming, but now I'm stuck. I have a good grip on how we got into this mess, but I don't know how to get out of it. Privatize? Nationalize? All available routes may lead to very large and angry dragons.
What would it mean for T-bonds to lose their AAA rating? It's so unthinkable I have trouble picturing it, but I'm sure it would be very bad indeed. Where would all the money go? Europe? The euro's already overvalued. China? Russia? Now that's a scary thought. On the other hand, it would take care of our little trade deficit problem. And what would the world look like if Fannie and Freddie lost US backing? Bankruptcy for sure, but then what? No one could get credit for anything, massive layoffs, widespread poverty, etc, etc. These are only things that *might* happen, but that's enough to haunt my dreams. Amateur economic forecasting is a bad hobby for worrywarts.
Speaking of storms, y'all Houstonians may want to stay inside for a while. You may not have noticed, since it's not even a hurricane, but there's some nasty weather headed your way. Stay dry!
What would it mean for T-bonds to lose their AAA rating? It's so unthinkable I have trouble picturing it, but I'm sure it would be very bad indeed. Where would all the money go? Europe? The euro's already overvalued. China? Russia? Now that's a scary thought. On the other hand, it would take care of our little trade deficit problem. And what would the world look like if Fannie and Freddie lost US backing? Bankruptcy for sure, but then what? No one could get credit for anything, massive layoffs, widespread poverty, etc, etc. These are only things that *might* happen, but that's enough to haunt my dreams. Amateur economic forecasting is a bad hobby for worrywarts.
Speaking of storms, y'all Houstonians may want to stay inside for a while. You may not have noticed, since it's not even a hurricane, but there's some nasty weather headed your way. Stay dry!