Daily Update: Tuesday September 9th

Over at the Megan McArdle blog yesterday, our vegan libertarian D.C. blogger for Atlantic Monthly came to the triumphant conclusion that the Obama campaign is in trouble. She based this on polls taken during the Republican convention.  So here in this one post, you have the good, and the bad, of reading McArdle: interesting topics, yet sometimes completely over the top conclusions untouched by reasonable analysis. But mostly it's pretty good.

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The McCain staff has largely been preserving Sarah Palin's deeper wisdom for special moments, in the same way you don't make every day a Ruth's Cris dinner day. Wisdom is to be dispensed carefully, and like a mint upon the pillow to warm and delight you. But some souls are not warmed by Palin's comments on the Federal bailout of fornicating-with-danger twins Freddie and Fannie.  Apparently some people wonder if she knows how the entities function, and while we don't claim to understand every intricate detail of how those companies are run, we also don't claim to be worthy of picking up McCain's Secret President Blackberry and power control button should he prematurely go to the heaven that Palin believes in.

“They’ve gotten too big and too expensive to taxpayers,” said Ms. Palin, referring to the two entities. “The McCain-Palin administration will make them smaller and smarter and more effective for homeowners who need help.”

N.Y. Times' Dealbook goes on to ask:

But what did she mean? Did she mean, as some people are now saying, that she thought that Fannie and Freddie were government entities, which they are not, as shareholders of the two publicly traded companies painfully know? Or, did she mean that the bailout – whose final price tag will not be known immediately – was going to cost a lot of money?

I am guessing, given her early dedication to not staying at any one college for too long, that Sarah is a bit shaky on the details, which might also explain McCain's refusal to allow the Barracuda to talk to any press that might ask detailed questions.

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Of course the bigger issue is not whether Palin understands the details of such bailouts, but whether all the voters have a clear idea of how much trouble the nation is. This bailout represents a forced action, with the Treasury stepping in to reassure the foreign bond holders who have financed much of our economic activities over the years.  Scare that crowd, and much of the stability and luxury and flexibility that we enjoy goes to pieces.  This is the real issue at hand, and not unrelated to our continued reliance on debt to finance how America functions.  Any candidate that is not seriously looking at debt reduction and balancing the budget is in effect enslaving the nation.  

Kevin Hall at McClatchy writes:

When Treasury Secretary Henry Paulson announced the weekend seizure of mortgage-finance giants Fannie Mae and Freddie Mac, he cited the need to stabilize nervous financial markets and bolster the slumping housing market.

What he didn't say publicly is that foreigners, among other big institutional investors, had lost confidence in one of the most vital and plain-vanilla U.S. investments. In a sense, they were losing confidence in the world's largest economy, and he needed to reverse matters.

Hall goes on to mention that investors like China were bailing on the securities of the two firms. If this is not making you nervous, or making you think, it should.  If our level of thinking stops at Palin's looks, or McCain's Maverism, or even Obama's change, then we need to look deeper to make sure we know what they know.

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In case the rise of the stock market on Monday due to government bailout euphoria seemed to unmuddy the waters, Lehman Brothers would like you to know that they are still in the woods that Fannie and Freddie were fooling around in, and that Hansel and Gretal got lost in, and further, the Brothers Lehman cannot find their pants. In other words, they've not been able to come up with the capital infusion they need, and we kind of wonder how many financial firms the government can hold in its hands while chewing gum at the same time.

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Wisdom for the Day:
When you take a new job working with mostly women, for a man it is like discovering gold. But when you see the gold on the ring fingers, it like working in a coal mine.