Blaming the Bears
Thursday, October 30, 2008 | 05:35 PM
Here’s the latest act of idiocy: Blaming the media or the Bears for the credit collapse and market crash.
This not only demonstrates a total lack of understanding as to the
difference between causation and correlation, but it evinces an utter
disregard for the way the economy and markets operate. makes about
A classic example of this form of brain damage can be seen on the comments of a recent Floyd Norris blog post, Consumers Drag Economy Down. Norris notes, (as we did earlier today) “Consumers
are clearly in retreat, and the economy is suffering. The
year-over-year increase in real G.D.P. is 0.8 percent, the lowest for
any four-quarter period since 2001.”
It didn’t take long — the second comment actually — before the
‘tards actually started blaming Norris for the collapse. Let’s see what
Mark D. had to say:
Great. You guys are posting stuff that will create a self fulfilling prophecy.
Yes, it was all Floyd Norris of the New York Times who cut rates to
1%, and then kept them there for a long time. And, it was Norris who
forced the banks to lever up 40X. It was he who forced the rating
agencies to slap a triple AAA on junk paper, it was Norris who mandated
that hedge funds, trusts, pension funds and other buy this junk
paper.And of course, it was Norris who forced all those mortgage
originators to write those NINJA loans, and all those home buyers to
take 2/28loans they could not afford when the reset occurred.
Why does the internet cause people to turn their brains off? Does
anyone ever think for even a second before posting nonsense like this?
Self-fulfilling prophecy? Here’s a self-fulfilling prohecy: Write
thoughtful intelligent commentary on the economy, and a large swath of
humanity will trip over themselves trying to demonstrate why IQ test
are given on a cuvre.
A few other observations:
1) Because the NBER has not yet declared this a recession only means
the official start and end dates are unknown. A recession can occur
regardless of their declaration.
2) No, Charles J. Duffy, a recession is Not defined as “two
consecutive quarters of negative real growth.” The NBER definition is
here: http://www.nber.org/cycles/recessions.html
3) By that definition, we have likely been in a recession since December 2007, or perhaps January 2008.
~~~
The Big Picture is moving! The new post here
Thursday, October 30, 2008 | 05:35 PM | Permalink
| Comments (36)
| TrackBack (0)
add to de.li.cious | 
digg this! | 
add to technorati | 
email this post
TrackBack
TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d8341c52a953ef010535c5e430970b
Listed below are links to weblogs that reference Blaming the Bears:
Comments
Hhhhmmm, and let me guess which party these folks tend to vote for? Just sayin'.
Posted by: Mannwich (artist formerly known as Jeff M.) | Oct 30, 2008 5:38:44 PM
If the Bears could just settle their quarterback problems, they would probably do all right :)
Posted by: Bruce in Tennessee | Oct 30, 2008 5:45:07 PM
re: Yes, it was all Floyd Norris of the New York Times who cut rates to 1%, and then kept them there for a long time. And, it was Norris who forced the banks to lever up 40X. It was he who forced the rating agencies to slap a triple AAA on junk paper, it was Norris who mandated that hedge funds, trusts, pension funds and other buy this junk paper.And of course, it was Norris who forced all those mortgage originators to write those NINJA loans, and all those home buyers to take 2/28loans they could not afford when the reset occurred.
LMAO, Barry. Who knew Floyd was so diabolical?
Posted by: t*sphere*monk | Oct 30, 2008 5:52:43 PM
and Barry, you spelled cuvre like Favre..
(long silly day at the salt mine...long weekend though..hooray!)
Posted by: Bruce in Tennessee | Oct 30, 2008 5:52:51 PM
How did you get hold of Sara Palin's talking points?
Posted by: Winston Munn | Oct 30, 2008 6:13:42 PM
Barry,
Actually it's quite consistent with the "name calling" meme in politics. The idea is to change the subject so the guilty will never be singled out. People are paying big money for this. As long as the discussion is about why Mr. Milktoast beats his wife, no one will notice that his wife has no bruises. Some say these are crazy times. No, they are venal times. The crap is so thick that the common man can't avoid seeing it. The powers that be are running around like chickens with their heads cut off screaming that everything is fine and all the problems are in your mind. It's not working this time for some reason. The greed and self interest of the "reality challenged" (it's name calling to call them the rich) is too obvious.
Posted by: AGG | Oct 30, 2008 6:18:52 PM
No need for a response BR. it actually gives me a good giggle though
Posted by: harold hecuba | Oct 30, 2008 6:19:14 PM
What is so difficult about this period is that the "experts" are not. It's difficult to listen to anyone in a position of authority because time and time again they are proven wrong. What is really scary: 1) they either believe what they say or 2) they purposely skirt the truth.
I remember 4-5 yrs ago KNOWING there was a problem developing in housing, yet the "experts" had no idea what was happening.
Posted by: winslow | Oct 30, 2008 6:49:30 PM
Looking for some insight from anyone here. I'm a novice at these financial market blowups, but with all the intervention, figured it was going to get the credit market back to normal, at least for a while. Wanting to be conservative, bought some of the Vanguard Short Term Investment Grade Corporate fund a week ago. Even though the s&p is up 8% from there, the fund is down 2%. What gives? Anyone know what's happening in the high quality bond market?
Posted by: Western | Oct 30, 2008 6:57:21 PM
ok ok I give up....I'm gonna have to google cuvre....:(
Posted by: Simon | Oct 30, 2008 7:02:40 PM
So true, Winslow!...I tried moving to Long Island in 2003 on a solid (I thought), well-above USA median salary. I simply could afford nothing there WITHOUT going $0 down or an ARM or such. Unless I had $75K for repairs as well. So I passed and stayed out of that entire region. At THAT point I said something is VERY wrong with housing when a guy with a well-above average salary cannot PRUDENTLY purchase a home on LI or almost ANY major US metro area..DC, LA, SF, SD, Chicago, Boston.
Posted by: Peter | Oct 30, 2008 7:03:52 PM
I am first in line to slap around the MSM for shoddy workmanship, so when they get it right I feel I should give credit:
"WASHINGTON (AP) -- Scared and out of money, Americans stopped buying everything from cars to corn flakes in the July-September quarter, ratcheting back spending by the largest amount in 28 years and jolting the national economy into what could be the most painful recession in decades."
Finally, that is the type of open and frank speech that may get us somewhere.
Kudos!
Posted by: Winston Munn | Oct 30, 2008 7:07:39 PM
oh! curve....bell curve. Still don't get it never mind. Still in my opinion if everybody swtiched off their TV they would become better informed and more intelligent.
Interestingly enough it has been found that internet use stimulates brain activity....if only I could find the link.
One good thing about brain dead comments is that because they are written down and need to be read ...as is self evident I spose...but they therefore are, hopefully, comprehended in a thoughtful state by other readers. They then fail to achieve a brain dead response and follow on comments can proceed to tear them apart at leisure there by achieving the exact opposite of the intended goal, if there was one...
Posted by: Simon | Oct 30, 2008 7:16:12 PM
Winston Munn,
Agreed.
By the way, thanks for the great laughs on the "isms" definitions. You had me rolling in my chair.
Keep smackin' em' with the truth.
Posted by: AGG | Oct 30, 2008 7:23:49 PM
Simon:
I am sorry...Barry spelled curve like cuvre, and the quarterback for the Packers is Brett Favre, pronounced Farve...
I should have stuck to the topic. All the people who know me say I am stuck at 8 years old mentally. Being silly this evening, long week at work, but I have all weekend, and thank goodness I own the salt mine and don't have to work tomorrow.
And the topic is bears, like Chicago Bears....yep, pretty goofy now that I read over it.
Bruce in Tennessee
Posted by: Bruce in Tennessee | Oct 30, 2008 7:27:31 PM
Uh, quarterback for the Jets..
(I know....)
Posted by: Bruce in Tennessee | Oct 30, 2008 7:28:47 PM
Simon,
Using more of your faculties (internet versus TV) increases the exercise of your brain. I agree the internet is even better than a verbal face off because
1) Remarks made can't be denied.
2) Yelling doesn't drown out responses.
3) Principled individuals won't back down.
and
4) Greater vocabulary only wins an argument if logic is used. The dismissive type troll runs out of gas.
Besides, it's fun to harrass idiots.
Posted by: AGG | Oct 30, 2008 7:34:12 PM
It's not just us internet jack-holes, you know. I can't even count how many times I heard CNBC commentators suggest, "Are we talking ourselves into a recession?" in the last year. They should all be beaten with the idiot stick, and awarded spatulas (for their next career), yet they're all still there, blathering away.....
Get the tards off TV - then we'll worry about bloggers.
BTW, did anyone see that little Ratigan-Gasparino exchange today? WTF was that?
Posted by: mark mchugh | Oct 30, 2008 7:38:10 PM
By the way, something I didn't even know existed before this year, the Baltic Dry Index....today was 975..in June was 12,000.
http://www.bloomberg.com/apps/quote?ticker=bdiy&exch=IND&x=15&y=11
If you travel on the ocean now, do you even see a ship? I am not sure I understand how this index can be this low this fast...I have been reading about letters of credit, and so forth, but 975?
Posted by: Bruce in Tennessee | Oct 30, 2008 7:49:59 PM
White House Said to Want Limit on Loan-Guarantee Plan
By Alison Vekshin and Robert Schmidt
Oct. 30 (Bloomberg) -- The White House and Treasury Secretary Henry Paulson want to scale back a proposal by Federal Deposit Insurance Corp. Chairman Sheila Bair to guarantee mortgages to help stem foreclosures, according to two congressional aides briefed on the matter.
The Bush administration is reluctant to sign off on the plan because of its cost, the two people indicated. Bair's idea to provide guarantees for modified loans could take as much as $50 billion from the $700 billion bailout package approved by Congress this month.
*They want the bailout money for the banks and not the consumer.
read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=agaig6YJjPGU&refer=home
Posted by: Juhuti | Oct 30, 2008 8:07:07 PM
With one exception, it is true that “blaming the media or the bears for the credit collapse and market crash” is an act of idiocy.
That one exception arises if one characterizes Paulson and Bernanke as “bears” because of what they were saying last September. To some degree their predictions (last month) of potential doom were a self-fulfilling prophecy in that they scared consumers into retrenching. That retrenchment would have occurred sooner or later anyway, but it would not have occurred so suddenly right after the bailout debate. So there is actually a grain of truth in saying that the “media or the bears” contributed to the “market crash”.
Posted by: DL | Oct 30, 2008 8:53:03 PM
Speaking of the media....
We can't leave this subject without a shout out to that outstanding professional reporter Charlie Gasparino at CNBC. Charlie, what have ya got?
http://www.youtube.com/watch?v=rtgxMkp25Rg
Posted by: Winston Munn | Oct 30, 2008 9:00:39 PM
@ B in T
Baltic Dry Index
"I am not sure I understand how this index can be this low this fast...I have been reading about letters of credit, and so forth, but 975?"
Believe it's based on bids/contracts for shipping space, so 14,000 down to 975 means nobody has any orders to ship anything anywhere for the near-to-middle term?
BTW Attention! All TBP Posters!
Let's get with the program and transfer our collective attention to www.rithotz.com. Register and post comments there sooner than later. 'kay?
Posted by: batmando | Oct 30, 2008 9:33:00 PM
"a total lack of understanding as to the difference between causation and correlation"
Exactly. The level of financial and economic ignorance out there is amazing. I'm no financial genius, but I do make an effort to understand how this stuff works, and it blows my mind when I learn about how the Fed works and how the Fed and government and big business interact and what the try to pull over on us, and especially how they ARE able to pull all of this over on us. It seems Bush and Paulson and Bernanke are a little confounded as to why the smoke and mirrors that normally work are no longer working as economic reality starts to set in. At least some people are paying attention...
One way to thwart the thieves...
Posted by: Truth08 | Oct 30, 2008 9:34:25 PM
Bruce
Maybe Paulson wants to protect GS's investment in Litton Loan Servicing / sub prime mortgage Dec /07
http://www.bloomberg.com/apps/news?pid=20601087&sid=av8fOkC1HHEc&refer=home
Posted by: lizann | Oct 30, 2008 10:06:19 PM
