Is The Crisis Abated?

On Sunday I shared some initial thoughts about the Fed take-over of Fannie Mae and Freddie Mac. If you read it, you know I’m not exactly happy about the outcome.  My friend Bithead shared some great thoughts Monday, and I don’t disagree that something needed to be done.   He and I both agree dumping the CEOs was necessary.

And on Monday the Stock Market reacted very favorably to the news, with a huge rise in the Dow (500 points, settling up 289), with a strong positive impact to the banking industry.

But I’m still convinced that the solution divides the interests of those in the government now set to manage the affairs of these companies.  Everyone who looks at this right now is breathing a sigh of relief and investors are happy that their risk has been reduced… thus the positive day on Wall Street.  Many of us are certainly benefiting personally, if we have any investments that are growing today as a result of this.

But, will you and I continue to benefit in the long term?

Do we really believe that the Fed will release the control it has taken at some time in the future?

Not as long as we continue to fear failure as badly as we seem to now.

Not as long as those in power are able to feed off of this level of control.

Not as long as all of us are happy that we are seeing money line our own pockets.

And what price will we pay?

Time will tell.  I sincerely hope this plays out in a positive way in the long term.  But we should all watch carefully and hold those in power accountable.

About the Author

Mr. Smith is the Publisher of The Conservative Reader. He is Partner/Owner of Ambrosia Web Technology as well as a Systems Architect for Wells Fargo. Art hold a degree in Computer Science from Drake University in Des Moines, Iowa, and is a political blogger at the Des Moines Register. Art's views are purely his own and do not necessarily reflect the views of Wells Fargo.

 

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