There's a new chapter in the Book of Revelations and the NY Times is kind enough to print it for us. It turns out that the problem with our government's response to the housing crisis to date is that it has not been nearly generous enough! Really, I am not making this up. I will let the Prophet Peter Bernstein (PPB) tell it in his own words:
"ASSISTANCE to individuals and institutions in trouble always raises concerns about the moral hazards of bailouts, especially when a case can be made that people underrated risks or were blindsided in their decision-making. But we have no choice here. The economy teeters on the edge of not just a recession, but also a more profound decline where trouble in any single sector can spread breakdowns throughout the system, driving unemployment to intolerable levels. To sit back and let nature take its course is to risk the end of a civil society."
In other words, "screw moral hazard, we are at the edge of an unprecedented catastrophe"!!
It's pretty funny that PPB thinks what has been done so far is sitting back and letting "nature take its course". And what a course it would be in his mind. People, we survived the great depression without experiencing the "end of a civil society" for Pete's sake, so I guess PPB is forecasting something worse than that? Without further bailouts we are looking at a Mad Max / Road Warrior situation?
Phone call for the owl of Minerva!!!