The Meltdown Blog

Bob Herbert latest op-ed in the New York Times doesn't contain anything we don't know already, which is precisely why it is such a remarkable column.

Herbert is "amazed at how passive the population has remained" as "gamblers and con artists of the financial sector" are "licking their fat-cat chops over yet another round of obscene multibillion-dollar bonuses" while "tens of millions of working Americans are struggling to hang onto their jobs and keep a roof over their families’ heads". Is stupidity the explanation ("a sucker born every minute")? Max Keiser would certainly agree.

Many commentators have previously expressed their hope that banking might become boring again, i.e. that it would return to providing actually valuable services to the economy. Instead, the financial "high-wire artists" are still playing the same game - with a safety net provided by the taxpayer.

It looks like no lessons have been learned. There'll be a price to pay for this mind-boggling stupidity.

Herbert's suggestion to prevent another economic meltdown:

If some company is too big to fail, then it’s too big to exist. Break it up.

That would be a start. In the financial sector, however, "too big to fail" could also mean "too connected to everyone else in gambles or insurances against gambles to fail". Therefore, the changes required would indeed be fundamental as we'd have to outlaw a lot of what the self-righteous clowns in the financial sector consider to be their legitimate core business.

"But you can't simply do that". Yes, we... no, actually, right now I'm afraid we're fucked and deserve it.

Update Oct. 21: Wolfgang Kaden wrote essentially the same comment today as Bob Herbert (on Spiegel Online, in German).