By Edward Angly, copyright 1931




Lines of the Times (And Again)


JUNE 29, 1930.

The worst is over without a doubt.

—James J. Davis,
Secretary of Labor

JULY 18, 1930.

America is not suffering from a depression any worse than are European countries....  As sure as fate, the chimneys will be smoking and the crops will be good and will bring good prices in 1932 and Hoover will be re-elected....  That’s serious.

—U. S. Senator Royal S. Copeland

SEPTEMBER 12, 1930.

We have hit bottom and are on the upswing.

—James J. Davis

SEPTEMBER 18, 1930.

All indications are that the Spring will see improvement, which will become marked by next Fall.

—Francis H. Sisson, Guaranty Trust Co.

OCTOBER 2, 1930.

Judged by historic precedences, we have now reached low ebb.

Resolution of American Bankers Ass’n.


I see no reason why 1931 should not be an extremely good year.

—Alfred P. Sloan, Jr., General Motors Co.

NOVEMBER 15, 1930.

You will wake up some morning and find that the American people have turned over in bed and that the speculative orgy is over.

—Thomas W. Lament,
J. P. Morgan & Co.

NOVEMBER 25, 1930.

As sure as I am standing here, this depression will soon pass and we are about to enter a period of prosperity the like of which no country has ever seen before.

—Walter S. Gifford, American Telephone and Telegraph Co.

DECEMBER 1, 1930.

Though I get depressed and blue sometimes, I know that our normal trend is upward and onward.

—Charles M. Schwab

DECEMBER 18, 1930.

It is difficult to see where any more bad news can come from.

—Kurt W. Jappe,
Brookmire Economic Service


The present depression, which is commonly called a business depression, will in my belief end within six months.

—W. S. Parish, Humble Oil Co.




Although the challenges are different in detail, the scale of the problem is much like that Paul Volcker faced in 1979.

—Charles R. Morris,
The Two Trillion Dollar Meltdown


As this book goes to press, the position of the monolines would be comic, if it weren’t so serious.  Although the market rates Ambac as a junk-caliber company, its name as a backup on a similarly risky CDO bond transmutes the bond into a triple-A credit.  The alchemy is possible only because the rating agencies have so far grimly stuck with their triple-A rating of Ambac.  But everyone knows that they are maintaining that pretense only out of fear of precipitating a wave of downgrades on another $2 trillion to S3 trillion of bonds.  In short, we are stuck in an “Emperor’s Wonderful New Clothes” moment.  Even as the Treasury, the financial press, and the banks roundly criticize the rating agencies for their wild overratings of CDOs, there is growing alarm at the possibility of a realistic rating of the monolines.  Should some innocent point out that the emperor is really naked, chaos may ensue.

...The stage is set for a true shock-and-awe surge of asset writedowns through most of 2008.  Widespread collateral defaults, particularly at the credit hedge funds, will trigger forced selling from margin accounts.  Rolling downgrades will require divestitures by pension funds and insurance companies that find themselves in violation of rules on holding investment-grade paper.  Holders of senior CDO tranches will liquidate their holdings as credit protection dissolves, as they have the right to do.  Add in even mildly bad outcomes for the monolines and in the credit insurance markets, and the global financial system will be in catastrophe.

It amazes that we have come to such a place.

—Charles R. Morris,
The Two Trillion Dollar Meltdown

OCTOBER 23, 2008

I have found a flaw [in my free-market ideology].  I don’t know how significant or permanent it is.  But I have been very distressed by that fact.

—Alan Greenspan,
testimony before Congress

NOVEMBER 23, 2008

We are convinced that we can overcome this crisis in a period of 18 months.

The annual Asia-Pacific Economic Cooperation forum

JANUARY 12, 2009

I inherited a recession, I’m ending on a recession.  In the meantime, there were 52 months of uninterrupted job growth.

—George W. Bush


FEBRUARY 13, 2009

This is what’s coming, America: Depression and revolution.

—Glenn Beck

FEBRUARY 19, 2009

The government is promoting bad behavior!  Do we really want to subsidize the losers’ mortgages?!!!!  This is America!!!!!

—Rick Santelli,
derivatives trader

(No doubt Santelli would define “self-help” in the same way as Wilson did.  Santelli could write a book telling people in trouble how they could empower themselves, etc., and populists in contempt of “pity-parties,” “victim-power,” etc., would love it.)



NOVEMBER 24, 2008

Everybody and his brother has got to have their hand out now.  The whole problem is so much bigger and deeper than the Fed and Treasury ever understood.

—Eric Hovde,
chief investment officer at Hovde Capital Advisors,
Regarding the $306,000,000,000.00 bailout of Citigroup.

NOVEMBER 25, 2008

It’s all fine, but we have to come to grips that unlike any financial crises – and I’m an expert on them – this one is a complete outlier.  In other crises, the uncertainty on the total of the losses was resolved in a matter of months.  We’ve been trying to resolve mortgages and CDO tranches for a year and a half.  It’s not going well.

—Charles Calomiris,
the Henry Kaufman Professor of Financial Institutions
at Columbia University’s business school

DECEMBER 22, 2008

There is nothing that upsets me more than a bank that comes to the Congress begging for money, and once they—and, then, once they get the money, turn around and say, na, na, na, na, na [sang like a taunt], see you later.  I’m not going to tell you anything [about what they’re doing with it].

—Representative Elijah Cummings,
on CNN

FEBRUARY 20, 2009

I don’t remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world.

—Paul Volcker,
speech for the Columbia [University] Center for
Capitalism and Society’s sixth annual conference

MARCH 6, 2009

Wall Street investment firms, commercial banks, hedge funds, real estate companies and insurance conglomerates made $1.7 billion in political contributions and spent another $3.4 billion on lobbyists [between 1998 and 2008].

—Wall Street Watch,
Sold Out: How Wall Street and Washington Betrayed America

MARCH 6, 2009

We now forecast UK profits [will] fall by 60% across 2008 and 2009.  While this sounds a rather draconian and hyperbolic downgrade, we believe it is realistic and incorporates the big losses that have come to light in the banking sector as well as a sharp drop in commodity prices (oil was $100 last September).

—Morgan Stanley

MARCH 6, 2009

Alistair Darling has already spent almost a fifth of Britain’s GDP on bailing out its shattered banking system—more than any other major economy, according to a grave assessment of the world financial crisis published today by the International Monetary Fund.

—Heather Stewart,
The Guardian

MARCH 8, 2009

In one of the bleakest assessments yet, economists at the World Bank predicted on Sunday that the global economy and the volume of global trade would both shrink this year for the first time since World War II.

—Edmund L. Andrews,
New York Times

MARCH 8, 2009

“The nine most terrifying words in the English language are: ‘I’m from the government and I’m here to help.’”  Thus quipped Ronald Reagan, hero of US conservatism.  The remark seems ancient history now that governments are pouring trillions of dollars, euros and pounds into financial systems.

—Seeds of its own destruction,
Martin Wolf,
The Financial Times

MARCH 9, 2009

It’s [the economy] fallen off a cliff.

—Warren Buffett

MARCH 8, 2009

After the crisis, we will surely “see finance less proud”, as Winston Churchill desired back in 1925.

—Seeds of its own destruction,
Martin Wolf,
The Financial Times

MARCH 9, 2009

We have over 200 people that are, unfortunately, camping out along the river.  And I think what’s happening in our city is we have to make sure that we have tough love.  We have to find a balance being compassionate on one hand, and then also a zero tolerance.  These are safety hazards, not just for the homeless population, but for the people who want to enjoy the river.

—Kevin Johnson,
Mayor, Sacramento,
on Larry King Live

1939 (and still revered)

Resentment is the “number one” offender.  It destroys more alcoholics than anything else....  If we were to live, we had to be free of anger....  [Fear] somehow touches about every aspect of our lives. It was an evil and corroding thread; the fabric of our existence was shot through with it.

—Bill Wilson,
Alcoholic Anonymous’ Big Book

(This is the essence of how addicts are supposed to practice “Made a searching and fearless moral inventory of ourselves,” and, “Were entirely ready to have God remove all these defects of character,” so of course to a stockbroker during the Great Depression, these are the defects of character that had to be fixed, in those who, during the Great Depression, had good reason to feel them regarding the stockbrokers.)

MARCH 16, 2009

But what about the commitment to taxpayers?  Here is the second, perhaps more sobering thought: A.I.G. built this bomb, and it may be the only outfit that really knows how to defuse it.

A.I.G. employees concocted complex derivatives that then wormed their way through the global financial system.  If they leave — the buzz on Wall Street is that some have, and more are ready to — they might simply turn around and trade against A.I.G.’s book.  Why not?  They know how bad it is.  They built it.

—Andrew Ross Sorkin,
New York Times,

The Case for Paying Out Bonuses at A.I.G.

MARCH 18, 2009

Mistakes were made at AIG on a scale few could have imagined possible....  Those missteps have exacted a very high price, not only for AIG but for America’s taxpayers, the federal government’s finances and the economy as a whole....  As we all know, the U.S. government determined that a collapse of AIG and the consequent blows to our counterparties and customers around the world posed too great a risk to the global economy, particularly in the context of the near or actual failure of other financial institutions....  In order to [pay back the government], we have to continue managing our business as a business—taking account of the cold realities of competition for customers, for revenue and for employees.

—Edward M. Liddy,
prepared statement before Congress,
regarding taxpayers paying bonuses to the
executives who dealt with what ruined AIG



MARCH 16, 2009

A.I.G. is holding a gun to their own heads, saying “unless you help us continue to have this incredible life in terms of bonuses, we’re going to die and the taxpayers will be faced with a catastrophe.”...  It’s too bad Marxists don’t believe in god.  Otherwise they’d be thanking him for having sent A.I.G. down to earth to destroy capitalism.

—Professor William K. Black,
senior regulator investigating the savings
and loan scandal in the 1980s

MARCH 19, 2009

[Those AIG executives are people] who had to be bribed not to abandon the company.

—Representative Barney Frank

MARCH 21, 2009

Retention bonuses, as they are being described are a form of extortion.  What we’re told these are people that worked at the company, had specific knowledge about things that the company had done that needed to be undone and they had to be bribed not to leave, in effect, with the combination to the safe or the antidote to the poison.

—Representative Barney Frank,
on CNN

MARCH 19, 2009

The House of Representatives passed legislation Thursday to try to recoup bonuses paid to Wall Street executives with taxpayer money.

The measure passed, 328-93; most Democrats supported the measure, while Republicans were sharply divided.




MARCH 20, 2009

There are times when anger is cathartic.  There are other times when anger makes a bad situation worse.  “We need to stop committing economic arson,” Bert Ely, a banking consultant, said to me this week.  That is what Congress committed: economic arson.

—Joe Nocera,
New York Times

MARCH 20, 2009

A $14 trillion economy hangs by a thread composed of (a) a comically cynical, pitchfork-wielding Congress, (b) a hopelessly understaffed, stumbling Obama administration, and (c) $165 million.

That’s $165 million in bonus money handed out to AIG debt manipulators who may be the only ones who know how to defuse the bomb they themselves built.

—Charles Krauthammer,
Washington Post

(Give them money because they “may be the only ones who know how to defuse the bomb they themselves built”? Usually, that’s called “terrorism.”)

MARCH 19, 2009

The same is true with AIG.  It was the right thing to do to step in.  Here’s the problem.  It’s almost like they’ve got—they’ve got a bomb strapped to them and they’ve got their hand on the trigger.  You don’t want them to blow up.  But you’ve got to kind of talk them, ease that finger off the trigger.

—Barack Obama

MARCH 20, 2009

But there’s a danger in letting this outrage get to the point that it undermines the effort to contain the financial crisis.  And with Congress now rushing to pass legislation taxing away the bonuses of every banker at every bank or financial institution that takes government money, that point seems to have been reached.

—Steven Pearlstein,
Washington Post

MARCH 20, 2009

“We’re all going to lose on this thing,” said an executive at a large bank that took federal aid.  He and other bankers expressed shock at the rapid progress of legislation that could impose large pay cuts on thousands of workers [if the money came from the government], and dismay that the industry is at the mercy of an angry Congress.

—Binyamin Appelbaum and Tomoeh Murakami Tse,
Washington Post

MARCH 20, 2009

If [high returns on the high-risk investments that private investors might go into to relieve the banks of the toxic assets, in partnership with the government] are realized, it is easy to imagine how hedge fund managers would be treated when hauled before Congress.  “Perhaps the witness can explain to us how he justifies such windfall profits with the people’s money?  Have you no shame?  Give us the names, addresses and phone numbers of every millionaire you enriched at public expense so we can leak them to the press.”

—Michael Gerson,
Washington Post

JUNE 9, 1954

Until this moment, Senator, I think I never gauged your cruelty or recklessness....  Have you no sense of decency, sir?  At long last, have you left no sense of decency?

—Joseph Welch,
attorney representing the Army,
at the Army-McCarthy Hearings

(In other words, it’s fine to shame once-respected but reckless and cruel people, in nationally-televised hearings, as long as they and those like them don’t have an ineradicable power to destroy your life economically.)

MARCH 20, 2009

Obama said yesterday the vote on the House measure “rightly reflects the outrage” over disclosure of payouts at companies like AIG.  He said he looks forward to getting the final legislation....

“That is a serious problem” for Obama, said George Clarke, a member of the white collar and internal investigations practice at the Miller & Chevalier law firm in Washington.  “He had better start toning the rhetoric down on how bad these guys are if he wants to keep them ‘on the team.’”

—Ryan J. Donmoyer
Bloomberg News



MARCH 21, 2009

An alarmed banking industry looked for friends in Washington yesterday as it tried to head off severe Congressional restrictions on compensation, fearful that a wave of popular anger about vast paydays will result in permanent damage to the industry.

—Binyamin Appelbaum,
Washington Post

(Just imagine how much the public would care if the poor got alarmed about reductions in welfare payments made to them, that wouldn’t leave them starving.  But, of course, we all must understand that bankers expect what they expect.  Even when bankers get government money, the presumptions of Financial Darwinism apply.)

MARCH 21, 2009

Yet evidence overwhelmingly demonstrates that aid to Africa has made the poor poorer, and the growth slower. The insidious aid culture has left African countries more debt-laden, more inflation-prone, more vulnerable to the vagaries of the currency markets and more unattractive to higher-quality investment. It’s increased the risk of civil conflict and unrest (the fact that over 60% of sub-Saharan Africa’s population is under the age of 24 with few economic prospects is a cause for worry). Aid is an unmitigated political, economic and humanitarian disaster....

Stuck in an aid world of no incentives, there is no reason for governments to seek other, better, more transparent ways of raising development finance (such as accessing the bond market, despite how hard that might be).  The aid system encourages poor-country governments to pick up the phone and ask the donor agencies for next capital infusion.  It is no wonder that across Africa, over 70% of the public purse comes from foreign aid.

—Dambisa Moyo,
Wall Street Journal,
former economist at Goldman Sachs

(Everyone needs an incentive to produce, for a society’s economy to work.  Also, in the long run, this should benefit each individual, making him more productive, active, self-reliant, proud, etc.)


MARCH 21, 2009

A wave of social and political unrest could sweep through the world’s poorest countries if G20 leaders fail to come to their aid, the World Bank warns today, as new research says the credit crunch will cost developing countries $750bn (£520bn) in lost output and drive millions more into poverty....

[Managing director of the World Bank Ngozi Okonjo-Iweala’s] stark warning came as a new report from the Overseas Development Institute (ODI) said the collapse of the global economy would cost 90 million lives, lead to an increase to nearly a billion in the number of people going hungry and cost developing countries $750bn in lost growth.

—Heather Stewart and Larry Elliott,
The Guardian

(but everyone needs an incentive to be productive...)

MARCH 23, 2009

Felix Salmon of Portfolio calls the plan “doomed” and “needlessly expensive.”  He also looks at the quandary of how to induce banks to sell their toxic assets (which the government more politely calls “legacy” assets).

—Cyrus Sanati,
New York Times

(Not only is this more polite, but it implies “anicient history,” and everyone knows that if you’re angry about a problem that seems to be ancient history, and seems to be a legacy left over from previous executives, you’re neurotic.)

APRIL 21, 2009

There are a few problems with using the TALF program to buy up legacy assets.  First, it’s rewarding the worst behavior — buying no-doc loans.”

—Senator Charles Schumer,
New York

(But if they’re the ones who committed the behavior, how could these assets be just “legacies” that they inherited?)

MARCH 18, 2009

Third, when a financial calamity of the kind that hit AIG strikes, the only possible response is to roll up your sleeves, acknowledge the mistakes of the past, correct those mistakes, and move forward—exactly what AIG’s employees have been doing.

—Edward M. Liddy,
prepared statement before Congress,
the last of the “three simple beliefs”
around which AIG is now united

(In other words, these “mistakes” are just the legacy they inherited, and of course all will just accept this.)

MARCH 25, 2009

In case you haven’t noticed, there’s a common thread throughout all of this coverage, which is that Geithner’s plan cannot be successful unless it wins the enthusiastic endorsement of the very rich people who drove the broader economy into the ground in the first place.  Our press corps’ primary gauge of measuring rich peoples’ happiness is the Dow Jones Industrial Average, which it uses as a general substitute for actual economic statistics.

— Brad Reed,

MARCH 29, 2009

We have two choices: we can leave it as it is, hope banks will earn their way out of this process over time, and I am certain that will create the risk of a deeper, longer recession.

The classic lesson of financial crises is governments wait too late and that means more damage to the economy, higher deficits in the future and greater cost to the taxpayer.  We’re not prepared to take that approach....

To get through this, governments need to act.  There’s a great obligation and responsibility for government to act to solve these things.  The market will not solve this and the great risk for us is that we do too little, not that we do too much.

—Timothy Geitner,
regarding bank bailouts

APRIL 23, 2009

All the experience we have of past banking crisis is that you never recover before you have completed the cleaning up of the balance sheets of the financial sector.  You can postpone it—at the same time, you postpone the recovery.

—Dominique Strauss-Khan,
managing director of the IMF

MAY 29, 2009

Well, first the ongoing need to clean up the banks and deal with the bad assets, get them capitalized because while the stimulus has given an impulse, it’s like a sugar high unless you eventually get the credit system working.

...So I think for now the danger is if you actually spend too much government money you create a different problem so I think right now in terms of breaking the fall, stimulus—focus on the financial system.  That’s about the right mix.

...But the general sequence about trying to break the fall in financial markets, trying to have a stimulus package—I mean I might have come up with a slightly different structure, but I believe you needed a stimulus package for demand.  Focus on how to recapitalize banks and deal with the bad assets—that’s a story that’s still going forward.

—Robert Zoellick,
President, World Bank




Go to Next Page


Go to Index
















 Home Page

 About Us, Introduction

About Us, the Summary

 About Us, Index

My Story

  To The [Abuse] Survivors ♥♥♥♥♥

Men Dying for Love

On Doping

Index of “Oh, Yeah?

Victim Correction as a Panacea, the Summary (Top of Page 1)

(Page 2)(Main Page 3)

Cancer Victims Corrected Too

The Main Victim Correction as a Panacea

 Documentation On the Social Problem of Unnaturally Rampant Depression

 Standard Rationales for Victim Correction as a Panacea

 Schopenhauer on Predators

 Emphasis on Victim-Self-Blaming

Darwinist Lehman Brothers’ INSIDE Sales Tips

Darwinist Lehman Brothers’ INSIDE Introduction to Management Book

Out of the Same Mold as the Great Crash of 2008

Message for Intellectuals in the Islamic World

Candace Newmaker’s Experience

Breaking Important Confidences for Your Own Good

A Glimpse Into the Soul of Victim Correction

Cigarette Industry and Victim Correction

Niebuhr’s Ideas on Our Nature and Destiny

Herbal Experiences for Women

Some Ideas for Rapport