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Nov. 4, 2009
Tom Hamburger and Kim Geiger: Should prayers be covered?
JWisdom.com When God played peacemaker With Rabbi Sroy Levitansky (5 minutes)
Nov. 3, 2009
Martin Peretz: Beware, Barack. Beware, Rahm. Beware, Axelrod
JWisdom.com Are you are closet idolater? With Sara Yoheved Rigler (10 minutes)
Nov. 2, 2009
Paul Greenberg: The Holocaust is now on Facebook
JWisdom.com Abraham's Strange Change With Rabbi Yitzchok Fingerer (5 minutes)
Oct. 30, 2009
Rabbi David Aaron: Secret to Immortality
Caroline B. Glick Silencing dissent in America
Oct. 29, 2009
Lini S. Kadaba: Do tactics avert flu or reduce humanity?
JWisdom.com We Must Revamp our Religious Vocabulary With Gavriel Aryeh Sanders ( 10 minutes)
Oct. 28, 2009
Rabbi Yonason Goldson: Atheists in Bubbleland
JWisdom.com Why what we wear impacts who we are With Rabbis Mordechai Becher, Menachem Golberger and Aliza Bulow ( 10 minutes)
Oct. 27, 2009
Paul Greenberg: The United Nations Is Outraged Again, Or: Department of Mideast Static
JWisdom.com The Science of Love With Rabbi Jonathan Rietti ( 7 minutes)
Oct. 26, 2009
The Jewish Ethicist by Rabbi Dr. Asher Meir: Damaging disclosures with a twist
JWisdom.com Wisdom and Wonks With Rabbi Eytan Feiner ( 7 minutes)
Oct. 23, 2009
Rabbi David Aaron: Are you ready for the ultimate pleasure?
JWisdom.com Watermark and oneness with Rabbi Sroy Levitansky ( 4 minutes)
Caroline B. Glick Stop using limited powers in a way that expands our enemies' advantages over us
Oct. 22, 2009
Steven Emerson: Terror Cases Share Desire to Kill Americans
JWisdom.com No More More Family Fights --- Really? By Sarah Chana Radcliffe ( 5 minutes)
Oct. 21, 2009
Tonya Alanez: Holocaust denier sues survivor, calling Auschwitz memoir 'vicious lies'
JWisdom.com Meditating Jewishly: A Panacea for Success by Sarah Yoheved Rigler ( 7 minutes)
Oct. 20, 2009
Dennis Prager: Obama and Dalai Lama: Why Israel Worries about U.S. President
JWisdom.com Abraham was not religious By Rabbi Yitzchok Fingerer ( 6 minutes)
Oct. 19, 2009
JWisdom.comWhy Good People Do Bad Things By Rabbi Eytan Feiner ( 7 minutes)
Oct. 16, 2009
Rabbi Yonason Goldson: The Perfect Number
JWisdom.com Hearing Voices By Rabbi Sroy Levitansky ( 5 minutes)
Caroline B. Glick How Turkey was lost
Oct. 15, 2009
Jeff Jacoby: Peace vs. the 'peace process'
JWisdom.com: Former MTV producer and stand-up comedian Rabbi Lawrence Hajioff: Taming a Control Freak (A VERY fast 15 minutes)
Oct. 29, 2003
Mortimer B. Zuckerman: Graffiti On History's Walls (MUST-READ!)

Jewish World Review March 18, 2008 / 11 Adar II 5768

A crisis grows into its prime

By Wesley Pruden


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http://www.JewishWorldReview.com | Nothing frightens a man like bad news about his money. The war in Iraq, health care costs, gay marriage, abortion and tooth decay are all bad, but not as bad as a faltering economy, stupid.


Everybody's watching to see whether the greedy men at Bear Stearns and others like them will pull down the rest of Wall Street and eventually the shops on Main Street and finally the houses on Coffee Pot Lane. Empty assurances from the wonderful folks who brought this misery to our doorsteps are not very reassuring. The chief executive of Bear Stearns was reassuring everybody that his company was in fine shape only two days before rival JP Morgan bought him out for only $236 million, which is mere parking-meter change on Wall Street.


"Our liquidity position in the last 24 hours has significantly deteriorated," he explained yesterday. Translation for Bear Stearns stockholders: "We've blown a lot of your money and had a lot of fun doing it, and yesterday the vultures came down to feast." The buyout of Bear Stearns over the weekend didn't reassure anyone: Markets were down yesterday all over the world.


Native wit and sense are always more reliable than the expensive advice of consultants, analysts and other soothsayers of the voodoo persuasion, but wit is inevitably drowned by the noise of the voodoo priests. "Last week [President] Bush dared to wander from the [soothsayer] script," the Wall Street Journal observes, citing his remark "that a strong dollar 'helps with inflation' and rued its weakness against the euro. He was quickly reeled in by his advisers, and in his Friday speech to the New York Economic Club, Mr. Bush reverted to the boilerplate language that investors now interpret as favoring a weak currency."


The current terror is traceable to the "subprime crisis" of last summer, when the investment bankers — Bear Stearns first among them — paid the price for greed and incompetence in the form of granting thousands of loans to unqualified buyers of houses, many of them decrepit properties. Such loans turned out to be worthless paper.


Two English entertainers, John Bird and John Fortune, capture the absurdity in a routine for London television. (A YouTube video capture of it buzzes even now about the Internet.) Proving again that satire works best when it cuts closest to reality, Messrs Bird and Fortune, in the persons of an investment banker and his interviewer, explain what happened in the subprime crisis with a devastating mixture of fact and fancy.


What happened, says the faux investment banker, is that a mortgage salesman typically encounters a layabout sitting in his undershirt on the porch of a crumbling house "somewhere in Alabama" and offers to lend him the money to buy the house before it falls down. The resulting worthless mortgage is packaged with a hundred other identical dodgy mortgages into something called "a structured investment vehicle."


"I ring up someone in Tokyo," explains the investment banker, "and say I've got this package of mortgages and do you want to buy it? They ask what's in it, and I say I haven't got the faintest idea, and they say 'what do you want for it?' I say a hundred million dollars. They say 'fine,' and that's it. That's how the market works."


An exaggeration, perhaps, but not by much. The public understands instinctively that a Ponzi scheme like this has been going on, and thus the president's reassurance now is not very reassuring. "One thing is for certain, we're in challenging times," the president told reporters yesterday after huddling with Henry Paulson, the Treasury secretary. "But another thing is for certain: we've taken strong decisive action. We've shown the country and the world that we're on top of the situation."


Maybe. We must all trust, and hope, for the sake of the president and everybody else, that events will verify.

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

JWR contributor Wesley Pruden is editor in chief of The Washington Times. Comment by clicking here.

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