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Deika Morrison: Reasoning the Reasons

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Monday, October 13, 2008

A new day ? Well, yes and maybe

After the unprecedented global coordination, today the markets reacted VERY positively.
  • All US indices were UP
  • The Dow had the best rally since 1933 with the biggest Dow point gain EVER at 936 points
Amazing what serious committed global Government coordination can do! See and hear the views of Professor Jeremy Siegel of The Wharton School of the University of Pennsylvania

Made me think of Bob Marley's "Positive Vibration":

"Why not help one another on the way?
Make it much easier.

Say you just cant live that negative way,

If you know what I mean;

Make way for the positive day,

Cause its a new day

And its a new time,

And its a new feelin'

Said its a new sign

Oh, what a new day"

Truly I would have been satisfied with that fantastic lift in the markets (even if its for the day) .... and called it a good day. But then, late in the day, Senator Obama gave a great speech in Ohio. Just to be clear, I am not commenting on the political campaigning. I am commenting on the urgent tone and language attached to the concrete measures to provide "immediate" social and economic relief to address the very problems with regard to the potential unraveling of the social fabric I outlined in yesterday's post My sigh of relief but.....

From the Obama-Biden website, the summary version:
Obama's Economic Rescue Plan:

"Job Creation: A New American Jobs Tax Credit. Obama is calling for a temporary tax credit for firms that create new jobs in the United States over the next two years."

"Relief to Families:
Penalty-Free Withdrawals from IRAs and 401(k)s in 2008 and 2009. Obama is calling for new legislation to allow families to withdraw 15% of their retirement savings – up to a maximum of $10,000 – without facing a tax-penalty this year (including retroactively) and next year. "

"Relief to Homeowners:
90 day foreclosure moratorium for homeowners that are acting in good faith. Financial institutions that participate in the Treasury’s financial rescue plan should be required to adhere to a homeowners code of conduct, including a 90-day foreclosure moratorium for any homeowners living in their homes that are making good faith efforts pay their mortgages. "

"Responding to the Financial Crisis:
A Lending Facility to Address the Credit Crisis for States and Localities. Obama is calling on the Federal Reserve and the Treasury to work to establish a facility to lend to state and municipal governments, similar to the steps the Fed recently took to provide liquidity to the commercial paper market."

Needless to say, Republicans began to oppose this just as it was said. And again, I am befuddled that completely different countries could find a way to work together for the common good of their respective peoples, yet the Republicans (the ruling party) resist common sense bipartisanship in a time of unprecedented economic and financial crisis in their own country to help their own people.

So let me try: The unraveling of the social fabric is a very real potential problem for all people regardless of political affiliation. Fear, uncertainty, job loss, financial loss, and home-ownership loss has happened and will continue to happen because the financial sector "fix" cannot "fix" those issues overnight. If the term "economic stimulus" offends the Republican ideology view, why not call it "economic survival and ideological preservation" because if people have no jobs, no home, cannot afford to buy food or heating oil, cannot afford to live and are so frightened that they become paralyzed, there is no economic recovery. And if there is no economic recovery - say hello to the real possibility of "permanent government intervention" because there will be no other option. And remember, people vote for other people to "represent" them. So if the Republicans plan to be the government, they will only have a Socialist state to govern because they were so fixated on ideology that they were unwilling to yield to short-term relief measures to prevent a long-term problem.

So let's go back to Bob Marley's "Positive Vibration":

"Why not help one another on the way?
Make it much easier.

Say you just cant live that negative way,

If you know what I mean;

And let's hope the American government can find - in some bipartisan way - for its people to sing with the rest of the world:

"Make way for the positive day,
Cause its a new day
And its a new time,

And its a new feelin'

Said its a new sign

Oh, what a new day!"

I, for one, am ready for a "new day" for the world: A stronger, more stable, more equitable and more sustainable global financial and economic system is long overdue.

So bring on more global coordination - careful, considered constructive global COORDINATION
because it looks like the rest of the world is committed to to that "new day".

And in the US, we'll be satisfied with some plain old COOPERATION
because it is up to US to show the rest of the world that they want that "new day " too.

1 comment:

Malaiks said...

ABSOLUTELY BRILLIANT! I tell you, this BLOG should be required reading for the HUMAN RACE..
i quite honestly didn't really GET why the markets were suddenly up by such a large number today..and not only did you teach me some WHARTON BASICS, but in such an elegant manner, with the most appropriate metaphors, in all the right places.

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Reasoning The Reasons by Deika Morrison is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.