[lbo-talk] counting to 200 -- how about 500

[Robert Wrubel]

Martin Mayer's book on the S @ L crisis is excellent
reading for students of the political process.  In his
account, the damage could have been limited to about
$60-75 bn, if Congress had had the courage to admit it
had made a mistake in loosening regulations on S&Ls. 
In the present situation, it seems to be the press
that lacks courage (or information) to admit the
dimensions of the problem.  The underlying issue for
both politicians and press is always how much bad
information can the public take without losing faith
in government institutions altogether. Or, to put it
the other way, the first priority for government and
media always to give the impression that "we are in
control of things", not actually taking control.

BobW

--- Doug Henwood <dhenwood at panix.com> wrote:


> 
> On Nov 8, 2007, at 8:51 AM, Andy F wrote:
> 
> > On Nov 7, 2007 7:39 PM, ira <ira at yanua.com> wrote:
> >
> >> And guess what now? New reliable estimates
> suggest that using these
> >> market prices – rather than level 3 model
> gimmicks - will lead to  
> >> losses
> >> of another $100 billion on top of hundreds of
> billions of subprime
> >> losses. And some market participants are already
> talking – quite
> >> realistically – about total losses from this
> credit disaster in  
> >> the $500
> >> billion range.
> >
> > Isn't that what the S&L bailout was?
> 
> No, it was about $200b. As I remember, the loss
> estimates kept  
> getting bigger as that saga evolved, until someone
> hit the magic $1  
> trillion mark. 
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