Wednesday, July 24, 2002

Wall Street

I can't keep away from this story. The impending tragedy in Washington that will make things really tense on Wall Street and everywhere else is just dominating my thoughts. And now Paul Craig Roberts has a column out today that just sums the situation up perfectly. It smells right to me. Government had no small part to play in the downturn in the capital markets that is occurring right now.

If you are not familiar with Roberts, maybe you should check out his biography before you read the article. This guy knows his stuff. At least, as well as any economist knows anything. Since the experts seem to know nothing (whoever does know about capital markets has too much money to be writing a column) I figure that my opinion is a likely to be as right as any expert's, but to see a heavyweight like John Paul Roberts seeing this thing pretty much the same way I do makes it all the more frightening.

He starts this column with:
While Washington fuels -- and the media fans -- a fiery corporate witch hunt, the economy and investing public burn.

The witch hunt permits government to sate, temporarily, its greed for power under the guise of "reform." The media is the only financial winner: scandal coverage boosts ratings and advertising revenue.

Did you know that the current accounting scandals have their origin in government rules? The public needs to know the real cause of the scandals before Washington inflicts yet more damage on our institutions.

I hate to be discouraging, but if Paul and I are right, things will get a lot worse before thay get, inevitably, better.