Remember that your money is insured. Your 401(k) is already tanked (and it will bounce back, unless like my poor neighbor the Wachovia vice president, you kept it all in one stock!) so there's no need to run anywhere. If you're worried about your deposits above $100,000, well this is the world's smallest violin. You should have been tracking Warren Buffet years ago. It's not hard. He writes cheap, easy to read books about his investment strategy (buy sound companies which earn unspectacular returns but profit consistently by delivering a good product) and Berkshire's investments can be found online.
Through Tyler Cowen, in the meantime, comes word of a more sensible plan that wouldn't involve breaking the taxpayer's back, would preserve the "moral hazard" (at least for Wall Street), and wouldn't have allowed asshats like (I count down in rough order of disgust) Henry Paulson, Nancy Pelosi, Roy Blunt, and Barney Frank to play politics when their constituents' money is riding on the line.
As things stand, some more medium and large banks are going to be absorbed by giant banks, and some more big companies are going to go bust (sympathies to their employees). But it won't be the end of the world, or a second great depression. I actually agree with those, left and right, who opposed the bill on principle, because it was a terrible idea all around. The idea of rewarding those who caused this mess, and giving the executive more unbridled power than it already enjoys, stuck in my throat. A nasty recession might be better in the long run for America. (We'll see whether I still think so when it's my house in foreclosure.)
See Stephen Bainbridge for a more doom-and-gloom, but probably more realistic perspective. He thinks we're on the verge of Return to Waltons Mountain.
Good night John Boy!
Update: "If Congress were planning to pass a bill providing, say, a $100 per share subsidy to stockholders at the expense of taxpayers, no doubt stock values would rise in anticipation and then fall precipitously if the plan were unexpectedly voted down. That is essentially what happened here."
Last 5 posts by Patrick Non-White
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