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Gold/Mining/Energy : Gold Price Monitor
GDXJ 92.99+2.9%Nov 7 4:00 PM EST
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To: Bobby Yellin who wrote (20200)10/1/1998 11:33:00 AM
From: PaulM  Read Replies (3) of 116753
 
Feds justification for LTCM bailout: "there was a likelihood that a number of credit and interest rate markets would experience extreme price moves and possibly cease to function for a period of one or more days"

biz.yahoo.com

What are your thoughts on that, Morgy? All the govt activity during the bust part of the cycle really pisses me off, frankly. You can't have a bust without a boom. If LTCM was a threat to the world economy, why was it allowed to take those positions in the first place?

Where was the Fed during the boom? I'll tell you where Greenspan was. He was testifying before congress that the CFTC shouldn't regulate derivatives.

It's just so convenient to watch banks and other financial institutions make obsene money in boom times and then--when the inevitable losses follow--watch the regulators suddenly take notice say "hey, there's somethign wrong, we need to 'do something' about this." Just looking at what Russia did to the hedge funds and Lehman et al. goes a long way to understanding why Greenspan and company were so hot and heavy to bailout S. Korea, Mexico et al.

What do market movements have to do with the Feds jurisdiction anyway? Apparently, free markets are only allowed when the very wealthy benefit from them.
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