[lbo-talk] Fwd: WSJ MARKET ALERT: Dow Industrials Surge940Points

Jordan Hayes jmhayes at j-o-r-d-a-n.com
Mon Oct 13 14:37:57 PDT 2008



> it seems that the forclosures are getting the most blame for
> starting this disaster and I am curious if it really is that
> signnificant or is just an excuse to blame the masses for
> Wall Street excesses.

It's hard to pin down what "started" this, other than the usual two motivators: fear and greed. Foreclosures specifically, and the housing bubble more generally, are certainly a part of it; pundits and politicians will debate what "started" it, but the two numbers -- the dollar amount of the haircut on foreclosed mortgages, and the estimate of the size of the recent TARP bill -- aren't really mathematically related in any meaningful way.

/jordan



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