Wednesday, 24 September 2008

Did Buffett Just Give Us A Coded Warning?

Warren Buffett, new stakeholder in the megalithic survivor-biased Goldman Sachs, has referred to recent upheavals in the financial markets as "an economic Pearl Harbour". He is a very smart man who knows his history, having lived it and seen it up close. He will know better than most that Pearl Harbour is now understood in well informed circles to not only have been foreseen by FDR, but provoked by FDR in an orchestrated campaign to engineer a war with Japan dating from a plan adopted in 1940.

As yoyomo reminds us in an earlier thread, the book Day of Deceit: The Truth About FDR and Pearl Harbour provides dispositive documentary evidence.

Historians have long debated whether President Roosevelt had advance knowledge of Japan's December 7, 1941, attack on Pearl Harbor. Using documents pried loose through the Freedom of Information Act during 17 years of research, Stinnett provides overwhelming evidence that FDR and his top advisers knew that Japanese warships were heading toward Hawaii. The heart of his argument is even more inflammatory: Stinnett argues that FDR, who desired to sway public opinion in support of U.S. entry into WWII, instigated a policy intended to provoke a Japanese attack. The plan was outlined in a U.S. Naval Intelligence secret strategy memo of October 1940; Roosevelt immediately began implementing its eight steps (which included deploying U.S. warships in Japanese territorial waters and imposing a total embargo intended to strangle Japan's economy), all of which, according to Stinnett, climaxed in the Japanese attack.


Warren Buffet knows better than most just how dirty and mean this Bush administration plays. The politically motivated prosecutions of AIG after he endorsed Kerry in 2004 will have left scars, and his advising Obama puts him at huge risk if Rove succeeds with another GOP victory.

He is in the insurance business, isn't he? So think of his acquisition of a huge stake in Goldman Sachs and his endorsement of the Paulson Plan as insurance. Meanwhile, he may just be patriot enough to have provided a coded clue as to what he really believes you can expect.

55 comments:

pej said...

Interesting analysis. So you would think that Buffett is not corrupt and without integrity as it seems but rather that he has been under very high pressure from Paulson and Bernanke to approve publicly the biggest con in the history of mankind?

London Banker said...

@ pej

I find it intersting that both the Financial Times and the Telegraph quote the "economic Pearl Harbour" reference here, but I can't find a single source for it in the US media.

I've decided that there is a Saran Wrap Curtain around the USA to shield Americans from the news we read abroad. Apparently the Pearl Harbour reference has been understood by the US media as by ours, and ours chose to publish it while yours chose to suppress it.

And yes, even I need heroes, so I would like to think Buffett knew what he was saying. Even though he was forced by the Paulson protection racket to buy some "insurance", he may well have wanted to offer a warning for others as to the hidden agenda.

pej said...

This would then be a major relief for me, as he was also one of my heroes until a couple of days ago when he started to applaud paulson and bernanke...

So GS being the previous stronghold of Paulson, and probably his next one as well...

makes sense, although it's a little bit hard to believe at first.

dearieme said...

I don't doubt that FDR was a shabby enough human being to provoke Pearl Harbour, but was he competent enough? Few of his economic policies worked; can we be sure that his foreign policy did? I have similar reservations about W - must we really believe that such a dud is also a supreme conspirator?

Anonymous said...

To provoke a war you must have supreme confidence in your existing military force and force of industry to replenish and enlarge it. This time the entire structure is deep in a hole and digging much deeper. US enemies in the material world must be much amused. We will spend all available capital and add significantly to our indebtedness to slake our lust for vanity. Were any large power to suddenly make real war, we would be doubly bankrupt fighting far too many wars. When will a sovereign face truth? Bankrupt, insolvent, enfeebled, prostrate before our enemies...and we're still just plugging holes.

Detlef Guertler said...

If it's an "economic Pearl Harbour", it starts an "economic" world war, doesn't it? You needn't count nuclear weapons or flying fortresses, you count dollars and euros and debts.
Of course someone will have to pay these trillions of debts - but the ones that caused the damage are just doing their best not to pay for it. In the national US context "the ones" can be read as "Wall Street" - in the global context "the ones" are "the USA".
So, anonymous, the "US enemies in the material world" may be "much amused" - the US enemies in the financial world surely aren't.
Thank you, LB, for explaining what Buffett might think.

Black Bob said...

I wouldn't trust Day of Deceit very far. There's a review by a cryptology historian at http://findarticles.com/p/articles/mi_qa3926/is_200004/ai_n8892100 which you might find interesting. The main problem with any of these FDR/Pearl Harbour theses remains the fact that the Pacific battlefleet went to the bottom ; letting the Japanese attack Honolulu to start the war would be one thing, but allowing them to sink the main force with which you would hope to prosecute the said war is quite another.

Blissex said...

«would think that Buffett is not corrupt and without integrity as it seems»

No he is a genius! He has managed both to get a very good deal for himself and to set a minimum baseline for the Treasury, and state that assets should only be bought at low market prices, all in the public interest.

And it is a pretty good baseline: preferred stock, 10%
guaranteed, call option:

http://bigpicture.typepad.com/comments/2008/09/i-got-75b-but-i.html

Private gain and public service in a single operation. And just as the private gain is massive, his public service is also massive, because as someone remarked above a market price precedent is worth a lot more than debates and arguments.

He also has spoken sharp word against «maturity» prices instead of «firesale» prices:

http://www.cnbc.com/id/26867866

«BUFFETT: Well, I don't want to leverage up. No one wants to leverage up in this thing. So, if I could buy a hundred billion of these kinds of instruments at today's prices, and borrow non-recourse 90 billion, which I can't, but if I could do that, I would do that with the expectation of significant profit. JOE: But the government can do that. You can't. And that's why the private sector can't, even you, can't save the system. BUFFETT: I can't come close to it. But they have the ability to borrow. They can borrow much cheaper than I can borrow. They can borrow unlimited. They don't have covenants. They don't have -- I mean, they are in the ideal position. So, for example, if I were hiring advisers, as I talked about doing to buy these things, I would tell those advisers, 'Look it! People are buying these instruments to make 15 percent. So if you're going to charge me any fees, I'm going to defer those fees until I get rid of these instruments later on. If I don't make at least ten percent on my assets, you know, your fee goes down the drain. Because it should be a lead-pipe cinch to make 10 percent at the kind of prices that exist now.»

«And there's no one that can leverage up except the United States government. And what they're talking about is leveraging up to the tune of 700 billion, to in effect, offset the deleveraging that's going on through all the financial institutions. And I might add, if they do it right, and I think they will do it reasonably right, they won't do it perfectly right, I think they'll make a lot of money. Because if they don't -- they shouldn't buy these debt instruments at what the institutions paid. They shouldn't buy them at what they're carrying, what the carrying value is, necessarily. They should buy them at the kind of prices that are available in the market. People who are buying these instruments in the market are expecting to make 15 to 20 percent on those instruments.»

«And the big buyer, if they -- they shouldn't pay any attention to the cost of these instruments to the selling institutions. They shouldn't pay any attention to the carrying value. In fact, one thing you might do, is if someone wants to sell a hundred billion of these instruments to the Treasury, let them sell two or three billion in the market and then have the Treasury match that, for what they pay. You don't want the Treasury to be a patsy.»

pej said...

Alright, I have to admit, I was wrong about him. Thank god, I am relieved!

London Banker said...

@ Blissex

Excellent points! The same points were made in earlier analysis at RGE, and I really should have included them in this entry as relevant to the topic and the Paulson Plan more generally. On the other hand, he explicitly endorsed the Paulson Plan as drafted - and Paulson personally - so that rather undermines his setting a baseline or seeking democratic oversight.

john said...

Buffett has always been a democrat. His father was a congressman from Nebraska and a republican. However, Buffett has always supported the democrats.

Blissex said...

«On the other hand, he explicitly endorsed the Paulson Plan as drafted - and Paulson personally»

Nah, I see that as pure hypochrisy, let's call it diplomacy. He first spends several paragraphs attacking the plan as it is, and then:

«In fact, one thing you might do, is if someone wants to sell a hundred billion of these instruments to the Treasury, let them sell two or three billion in the market and then have the Treasury match that, for what they pay. You don't want the Treasury to be a patsy. But I'll tell you, with Hank Paulson on top of it, you couldn't have any better guy to do that.»

I read that as attacking the plan but then pretending to say nice things about Paulson, his good friend, to the effect that Paulson could take a bad plan and turn it into a good plan by being tough on the finance industry instead of on the taxpayer, as if that was Paulson intends. But of course he knows very well that Paulson's plan is about screwing the taxpayer, not the finance industry.

Anonymous said...

The Buffet comment is being reported by Bloomberg. However, no mainstream news has published it yet.

I am also taken back by his choice of "Pearl Harbor". Does he mean that the US is under attack by some "imperialist" power and we now need to intern US citizens of a certain "ethnicity"??

Its a very odd choice of analogy. What could he have meant?

In any case the Paulson Wall Street Bailout bill is gathering a lot of man in the street opposition. If Congress passes this bill it may raise significant issues of how deep in the hock politicians are to Wall Street bribes!

London Banker said...

I feel a bit sheepish, but it seems that the US media is picking up the "economic Pearl Harbor" quote. The reason I didn't find it when I checked earlier is that I searched for "Pearl Harbour" using the English spelling.

Churchill: "Two great nations divided by a common language."

Bloomberg: Buffett buys Goldman stake in 'economic Pearl Harbor'

Hasib said...

@LB
so are you implying that Buffet gave us a coded warning of an impending systemic crash?..
Isn't the $700 billion supposed to prevent it at least for a while?

acrumb said...

By the way see:
Fitts a former Clinton and A Bush I insider says the financial markets are in much worse shape than reported. The Fed is not just printing oodles of dollars, but 'printing gold' by selling 'gold certificates' not backed by any gold. And the GNMA mortgage bonds are fraudulently using the same mortgage 10 times to back 10 different bonds. What has been reported is the tip of the iceberg. Value of the dollar must collapse.
See:
http://solari.com/archive/housing_bill/
The Housing and Economic Recovery Act of 2008: An Analysis by Catherine Austin Fitts

maynardGKeynes said...

Black Bob nailed it. More fundamentally, Roosevelt sought a provocation from Hitler to quell the America First movement and allow the US to enter on the side of London Banker. The Japanese provided that excuse. We now know that Hitler was not happy about the Japanese attack at all, even though he thought that the US entry against Germany was inevitable sometime in 1942. It seems unlikely that Roosevelt wanted or needed the sinking of the US fleet and the mandate for entry he desired.

TC said...

It is difficult to think of Grandaddy Buffet crossing over to the dark side...So his unconditional support of this sham of a bailout has to make you wonder what it is we "really" don't know...LB you just hit the wrong nail...Keep hammering away!....

TC said...

My prior comment failed to clarify that I think this part of your analysis was spot on!

...[H]e may just be patriot enough to have provided a coded clue as to what he really believes you can expect...

hazleton said...

@london banker

If Warren Buffet gave us a coded warning of a systemic global crash, what would that look like? What would be some safe havens?

acrumb said...

By the way, you might want to check out the Florda based RE expert's blog:
http://realestateandhousing2.blogspot.com/
Wednesday, September 24, 2008
Warren Buffet - Liar, Liar, Pants on Fire
Tuesday, September 23, 2008
Paulson Calls In Buffet
http://realestateandhousing2.blogspot.com/
Monday, September 22, 2008
REPLAY Link - King Henry's Financial Crisis - Paulson Backlash

Anonymous said...

I have some fundamental questions about the actual mechanics of the plan. Hoping to find someone with real answers.

BB and HP seem to be pressing that the lockup of the market for short term commercial paper is the "armageddon" they are warning us about. If so, how does the taxpayer buying MBS, CDOs and other "toxic debt" liquify the market for short term CP?

Also, they are saying that once the taxpayer buys these securities, the government will be in a better position to modify loans and try to avoid foreclosing on homeowners. As I understand it, the owner of a derivitive security based on slices of a pool of loans, would most likely not be the servicer for those loans. Are they saying that they will be aquiring servicing rights somehow? How does owning tiny slices of pooled loans (maybe sliced and pooled a couple times- CDO^2) give them any ability to modify the underlying loans?

If you have any knowlege on these mechanics and would comment, it would be appreciated.

Thanks,
Deb

Anonymous said...

Seems like a few financial heavyweights are saying that there is money to be made.

See the comments by John Maudlin:

http://www.frontlinethoughts.com/article.asp?id=mwo091908

"If this is such a god deal, then why isn't everyone hitting the bid? Because these securities are very difficult to analyze. It is time consuming You need to analyze every loan and develop your own valuations. You simply can't trust the ratings, as they are measuring something completely different."

Why are more big money people jumping on these "fire sale" prices? Do they simply need more time to dig into the data? Are the banks not providing the data?

OkieLawyer said...

LB:

While I have gotten a lot of information from your blog, the conspiracy theories is where we part company.

"The absence of evidence is not evidence of its absence." This is known as the logical fallacy of arguing from ignorance.

I am not going to say that you are justified in your belief that this is orchestrated (the fraud that no doubt permeates this fiasco requires a legal proof of intent). This is compounded by the secrecy of this administration. Criminal conspiracies, if anything, require secrecy to succeed or continue.

And I have to admit, the sudden "discovery" that we are on the brink of a financial meltdown does sound suspicious given that Paulson and Bernanke are supposed to have their positions precisely due to their foresight.

The FBI is investigating now. But let's wait and see what the facts bring out. I'll admit, there's enough for me to get my tin foil hat out of its storage compartment; but I'm not going to put it on until I see some real evidence.

I don't want you to take this the wrong way; I still appreciate your writing and I still think you have a lot to offer to this discussion. Just hold off on the conspiratorial talk until we can get some real facts to support it.

It's one thing to say that the Bush Administration is taking advantage of a crisis (à la "Shock Doctine"); it's quite another to say that they created the crisis. It's possible, but let's not jump to conclusions quite yet.

OkieLawyer said...

Oops!

I meant to say: "I am not going to say that you are not justified in your belief...."

acrumb said...

By the way, the tapeworm mechanism Fitts is alluding to isn't something relatively new. It might have grown in magnification over the years;but, it has old roots. Hey old roots at least as far as the Constitution; and George Washington blessed an earlier version by appointing its early architect to the Supreme Court.
Michael Hudson's recent article gives one a little journey down memory lane to put things in perspective.
http://www.counterpunch.com/hudson09232008.html
A Cautionary Tale About Politicos and Financiers
Henry Paulson and the New Yazoo Land Scandal
By MICHAEL HUDSON

Raf said...

Sorry but this doesn't make much sense to me.

The sudden change of status for GS and MS smells very bad. And now Buffett, darling of Joe Investor, now pumps in $5bln.

Part of the Government Sachs cabal? It just doesn't add up. Either he's happy to pile in and make some easy cash on the back of the taxpayer or he's trying to protect his own stock base knowing a complete collapse is going to cost him a pretty penny.

A subtle signal? $5bln isn't very subtle.

I can only assume Buffett has turned to the dark side :-)

charlottemom said...

There is some discussion on Karl Denniger's blog about the draining of the Fed's slush fund in the last several days...why? Aren't P and B screaming about adding massive liquidity so to prevent seizing of credit and market crash. So it seems that table is being set for a crash?? What's up with that? Tinfoil?

Anonymous said...

@okielawyer
The FBI appears only to go after the crooks after their company has failed. So it seems that if you can stay in business you can avoid investigation - likely another desperate reason for the bailout.
I too find Buffets choice of words quite illuminating, not a natural analogy to use at all.
g

OkieLawyer said...

@anonymous:

Usually, the FBI can't get involved until the crooks have already disappeared with the money.

In this case, the "real crooks" will probably never be caught because the defenses get more convoluted up the chain. White collar crime is very difficult to prosecute in the best of cases. The higher dollar you get, the more complex the cases tend to be. Not only that, but the suspects tend to be much smarter and know how to cover their tracks better.

We will just have to see if anything shakes out. Don't hold your breath.

Anonymous said...

Let's look at the full quote and get a better meaning thru context:

``It's not like Pearl Harbor where you could look at what happened with your own eyes and decide you had to do something that day,'' Buffett said on the cable channel. ``This is sort of an economic Pearl Harbor we're going through.''

So what's the real meaning? He says that Pearl Harbor was something you could see, the destruction was tangible, it was immediate, and you had to react "that day."

The current situation is a crisis -an economic one, which means unlike Pearl Harbor, the damage is hidden and may take some time to unravel for all to see. Do you wait for the damage to show itself? Or do you react (pump 700 billion) ASAP?

Anyone else agree?

-gnk

Jesse said...

You might be giving Warren too much credit for secret meanings.

But I agree very much with the outre nature of this whole farce.

Here sign this bailout or the next thing you see will be a mushroom cloud.

http://tinyurl.com/3wkre9

Anonymous said...

Jesse,

Off topic, but since you don't have a comments section at the cafe I thought it apt to mention here that I thoroughly enjoy your blogs. Thanks.
g

Dan said...

I too would like to thank Jesse for his blog and commentary... It's among my favorites. Apologies to London Banker for hijacking his comment section :)

To bring this somewhat back on topic(ie Buffett, foreknowledge, secret meetings etc), a little known fact is that Bush met with Buffett at Offut AFB in Nebraska on the day of 9/11. As far as I know, Buffett has never publicly commented on this, but it is easily verified. It's a stunning fact, as far as I'm concerned -- why was Bush talking to this businessman in the middle of the fog of that day?

There is no doubt that US military policy served to provoke Japan by limiting their access to oil, among other policies. I think that the issue of who knew what and who was directing policy is highly debatable, for what it's worth.

acrumb said...

Is bailout temporary stealth measure to recapitalize Fed?..
See:
http://europe.theoildrum.com/node/4563
Paulson and Bernanke ratchet up the blackmail talk

Anonymous said...

According to Reuters it looks like democracy has lost and the coup d'etat will succeed. At least initially.

Taken together with the other strange events that have occurred since Bush became the puppet-in-chief, things are beginning to look very frightening indeed.
g

Knute Rife said...

Geez, LB, are the black helicopters circling your house?

First, I must say I'm not as impressed with Stinnett as yoyomo is. The nonpopular reviewers have been, shall we say, less kind than the popular reviewers who know approximately squidly dot about the topic. One of the themes constantly expressed is the fundamental truth that you should insist on iron clad evidence before attributing to conspiracy what can be explained by incompetence. For example, even though Pearl had been hit, MacArthur was caught flat-footed when the Japanese hit The Philippines the next day (And why that megalomaniacal lardbutt managed to die a hero in spite of it. Don't get me started on MacArthur.).

Is Buffett part of a conspiracy? Doubt it. As I've stated elsewhere, I think he's just taking advantage of the bailout, and he knows either the ignorant government or ignorant punters will buy whatever he wants to sell at whatever price. He intends to make a profit. Period.

As an aside, a parable: A guy worked at a sawmill for a number of years. Every Friday, he left with a wheelbarrow full of sawdust. The guards knew the sawdust was worthless, but they figured he must be stealing something, so every week they probed it, looking for hidden contraband. They never found anything. Years later, on his deathbed, the man revealed he was indeed stealing every week. He was stealing wheelbarrows.

It occurs to me that the TARP may be stuffed full of crap like the nonreviewability clause to distract us from noticing that the entire idea of a bailout is full of crap. If that is the case, it has been very successful so far.

London Banker said...

@ Knute
You're right. I'm now looking for fascists in the closet and under the bed. Time to change gears.

I'll try to write something uplifting and philosophical for Friday. As I said to Pej, I still need heroes, and one of them wrote a piece a few months back that I've been wanting to promote on the blog.

Anonymous said...

LB,
These are dark times with potentially immense and horrible consequences.

Complicit in the evils that lead to this coming disaster is the press, or mainstream media going along with the lies and deceit. And the choice of politicians that will lead us out is nothing less than disastrous.

Two wars of aggression continue virtually without comment, with the threat of more. Now we have a financial coup d'etat that threatens a future fascist dictatorship, sooner rather than later.

And because of a mild criticism saying that you might have been mistaken in reading too much into the comments made by a multi-billionaire - and who can interpret the motives behind what such people say, but at least we are entitled to speculate - you begin to feel paranoid and tin-foil hattish and promise to back off by writing a nice piece.

Come on, please. You have built up a readership by being a cynic who does not parrot the press, and who does not attempt to report 'nice' drivel to make us feel good in this time of crisis.

Stay with it.
g

yoyomo said...

black bob,MGK,
The most valuable asset in the Pacific theater were not battle ships but aircraft carriers and those were safely sailed out of harm's way a few days before the attack. The sinking of a few battle ships was visually traumatic but not strategically decisive especially since Pearl Harbor is shallow and most of the damaged ships were easily raised and quickly repaired. It's not like they sank to the bottom of the Mariana Trench.

Black Bob said...

Well, think of it like this. What advantage would be conferred by having the Japanese make an attack on Hawaii in which the US battlefleet was sunk over and above that conferred by one in which it was not? Would the US Congress and people have been willing to let the matter lie if no ships were sunk shelved any idea of war with Japan? I don't see that one.

TC said...

@LB
"...write something uplifting and philosophical for Friday..."

Thanks...I think we may need it...

TC said...

Follow the number...$700bn cannot possibly be as arbitrary as Paulson would like us to believe...It's all in the math...

Nick Marshall said...

If there is a hidden agenda,it is surely the immense power now passing into US government hands if the bailout is carried through. The takeover of Fannie and Freddie gave control of around half the mortgages in the country to the government. The $700 billion bailout will severely compromise Wall St and give the government an effective excuse to either raise taxes or lower welfare payments. All this in addition to the huge escalation in defence spending and Home security. A fairly handy outcome for this extreme administration (think 1930s Germany). I am not suggesting that all of this has been planned - far from it but it leaves the US citizenry extraordinarily vulnerable to the next administration. Not a great situation when it can be expected that the public anger will become ballistic as the full scope of the mess becomes more apparent.

Of course, there is a small chance that no agreement will be reached. Is there any good reason why simply letting the market do it's work and allowing the "systemic" failure (whatever that is) to take place. Bail-out or no bail-out, I can't see a severe recession or worse being avoided. If anything, intervention is only likely to make matters worse and set back the clear benefits of free markets for two or three decades. Welcome to the new world of Chinese/Russian style statist economies.

dink said...

"...write something uplifting and philosophical for Friday..."

What would be more fun is what you think Paulson told all these elected officials behind closed doors. They're obviously terrified. It has to be far more than The Shrub told the masses last night.

London Banker said...

@ dink
I'm already on record saying that I think the gun to the Congressmens' heads is the Fed is illiquid. Over $600 billion of their $800 billion in balance sheet Treasuries has been lent against this crap MBS collateral. The Paulson Plan will allow banks to take back the crap MBS and get cash for it from Treasury, returning the good Treasuries to recapitalise the Fed. If the Fed doesn't get recapitalised pronto, then the next big shock takes down the central bank. That's the threat that is forcing through this bill.

Roger Bigod said...

LB

In US vernacular, "Pearl Harbor" just means "shocking and total military disaster". We used to use "Waterloo" in more or less the same way. Buffett isn't given to irony or double meanings, so I don't think he had an attempt to provoke a crisis in mind. He is of course careful with his words and reticent about things many of us would blabber about, but that's to be expected of a master negotiater.

Whatever advance knowledge Roosevelt may have had, the larger fact is that we placed an oil embargo on Japan which can be interpreted as an act of war in international law. The overstretched Japanese military needed every drop they could get, so it was a "vital interest" or whatever term applies. Yurgin discusses this in his comprehensive history of the oil industry.

Buffett's statement is somewhat mysterious. It could be payback for being allowed to do the GS deal. Or returning a favor he owed Paulson. Or he could sincerely think the bailout is in the public interest.

Anonymous said...

Here's a conspiracy theory for you. WaMu just failed fairly gracefully tonight - no cost to FDIC. If the world's largest thrift can go under without making too many waves, maybe ...
What if Rove thought up Paulson asking for $700B to bail out fat cats. An imperious demand, very annoying, with lots of weird demands for total power. Then scare the Demos in congress into going along. So that ,,, ta-da ,,, saviour man McCain and the good Republicans of congress can nix it and foil the plan which made Americans so angry.

It's win/win - you win the election, and if you're really lucky, you might get $700B too!

suecris

Knute Rife said...

A recent conversation in the JPMC boardroom:

Q: What are we going to do today, Brain?
A: The same thing we do every day, Pinky: Try to take over the world.

Except that for JPMC, there is no try. They are doing. With full federal complicity. So which connections make them such a favored child?

While I admit that for purely selfish reasons (The bulk of my accounts have been at WaMu for years.) I'm glad this went so smoothly, there is not a bank in the world I despise more than Chase. Could be time to move the flag again.

yoyomo said...

black bob,
I think what you don't see is the violent hostility the populace had to another war. Woodrow Wilson had campaigned to keep the US out of the first WW and as soon as he was inagurated he began to conspire to enter it. The country had no patience for more of the same old BS Wilson pulled on them and another blatant set-up like the Lusitania (the German Consulate in NY had taken out a notice in the NYT warning passengers not to board the ship because it was carrying illegal war supplies and would be attacked if it tried to reach England) simply was not going to cut it to get congress to vote for war.

The advantage was in the attack itself being a "surprise" and undefended against, not in the sinking of the battleships but the results of the attack were beyond Roosevelt to control, i.e. acceptable collateral damage.

Anonymous said...
This comment has been removed by a blog administrator.
Freedom Fighter said...
This comment has been removed by a blog administrator.
OkieLawyer said...

What if Rove thought up Paulson asking for $700B to bail out fat cats. An imperious demand, very annoying, with lots of weird demands for total power. Then scare the Demos in congress into going along. So that ,,, ta-da ,,, saviour man McCain and the good Republicans of congress can nix it and foil the plan which made Americans so angry.

It's win/win - you win the election, and if you're really lucky, you might get $700B too!

suecris


suecris:

This is the kind of "conspiracy" that makes more sense (and that I and others had suggested) and it fits with the Shock Doctrine.

Another way it works is for the neoconservative doctrine of Starve the Beast. If the country has to spend all this money of this debt, it will not be able to afford things like National Health Care and Social Security. So your argument is correct that the conservatives / Republicans see this as a win/win.

Paul Richardson said...

So there are a couple of things I wonder

1) What exactly was it in that initial meeting Paulson had with some members of congress (schumer et al) that all caused them to freak out

2) If the fear was a vapor luck in the international credit flow (no, we yanks are as isolated as we would be led to believe), then why not first force transparency on these institutions (show your cards), then determine who needs aid. This lets all the players see who is in real jeopardy

pej said...

Hi London Banker,
I think it's time to try to update our opinion about Warren Buffett. His last comments still seem to imply that he agrees with what Paulson/Bernanke/USGov is doing is the right thing to do.
What is your updated take about him?