Must Read - Phony Crisis. David Kay Johnston: Reporters start your skepticism.

[Dr.Phool]

From DAVID CAY JOHNSTON: Journalists, start your skepticism.

In covering the proposed $700 billion bailout of Wall Street don't repeat the failed lapdog practices that so damaged our reputations in the rush to war in Iraq and the adoption of the Patriot Act. Don't assume that Congress must act instantly, as so many news stories state as if it was an immutable fact. Don't assume there is a case just because officials say there is.

The coverage of the Paulson plan focuses on the edges, on the details. The focus should be on the premise. And be skeptical of what gullible Congressional leaders, most of them up before the voters in a few weeks, say after being given a closed-door meeting on supposed horrors.

The Administration has scared the markets and some key legislative leaders, but it has not laid out a coherent, specific and compelling need for this enormous proposal, which is the equivalent of a one-time 55 percent income tax surcharge. (Instead the money will be borrowed, so ask from whom and how this much can be raised so quickly if the credit markets are nearly seized up with fear.)

Ask this question -- are the credit markets really about to seize up?

If they are then lots of business owners should be eager to tell how their bank is calling their 90-day revolving loans, rejecting new loans and demanding more cash on deposit. I called businessmen I know yesterday and not one of them reported such problems. Indeed, Citibank offered yesterday to lend me tens of thousands of dollars on my signature at 2.99 percent, well below the nearly 5 percent inflation rate. That offer came after I said no last week to a 4.99 percent loan.

If the problem is toxic mortgages then how come they are still being offered all over the Internet? On the main page AOL generates for me there is an ad for a 1.9% loan (which means you pay that interest rate and the rest of the interest is added to your balance due.) Why oh why or why would taxpayers be bailing out banks that are continuing to sell these toxic loans?
(snip)
Much more at

http://poynter.org/forum/view_post.asp?id=13611

Keep this kicked

[Speck Tater]

1. Very good points! K&R

[Old and In the Way]

2. Why now?

Bush hatched this stinker to put the Democrats, the majority Party in Congress, in a position to be blamed for the financial crisis. Newt and other Republicans want to run against this proposal. Democrats can sign on to support the economy from a meltdown and Republicans can paint them as Bush collaborators....or not support and take the blame if this spirals out of control.

Smart move is to signal that we'll do what it takes to save the economy, but not with a gun to our heads. Give Bernake a $100BB and tell him to come back in January.

[bbgrunt]

4. yes, it is a political manuever to both let

all their malfeasance off the hook and to blame the democrats. I like your plan.

[formercia]

5. $700 Billion is just a bridge loan to keep Wall Street afloat

until January. They know that the Obama administration won't put up with this crap and are hoping the economy will collapse on his watch and not Junior's.

[burythehatchet]

6. Never negotiate with terrorists (even financial terrorists)

[formercia]

3. I admit that I'm not getting as many credit card offers lately.

Now it's only half of my mail instead of 95%. The more you tear them up, the more they send.

I would burn them for heat this Winter but the ink is probably toxic.

[knitter4democracy]

7. That's a really good point.

Why aren't they calling in their chips? Why are all of the banks acting like everything's normal on the local level but acting like the sky is falling on the national level? Is this more of the Shock Doctrine--extra bonus points if the shock is entirely manufactured and not actually real?

[snappyturtle]

8. K&R

:kick:

[katty]

9. K & R

[K Gardner]

10. I dunno.. I inquired with several car dealerships over the weekend about a semi-new vehicle, and

as yet, no one has called me back. Since when did carsalesmen not call back?

And it ain't that my credit isn't good enough :-)