REALITY: Ben Bernanke’s Testimony On September 26th, 2008
I find it extremely troubling that my fellow bloggers would believe a columnist from Portfolio who only suggests that Congressman Kanjorski’s claims were false without providing any evidence or checking what the players actually said.
You know the players…like one of the guys who actually saw what was going on from the inside of the Fed.
While perhaps manageable in itself, Lehmanâ€™s default was combined with the unexpectedly rapid collapse of AIG, which together contributed to the development last week of extraordinarily turbulent conditions in global financial markets. These conditions caused equity prices to fall sharply, the cost of short-term credit â€“ where available â€“ to spike upward,and liquidity to dry up in many markets. Losses at a large money market mutual fund sparked extensive withdrawals from a number of such funds.
This is less than two weeks after the situation Kanjorski described in the now famous video.
Also, let’s dig into what the columnist at Portfolio said…
on September 24, Kanjorski held a hearing on Capitol Hill with Treasury secretary Hank Paulsonâ€¦ Kanjorski is clearly fishing here: heâ€™s talking about anonymous newspaper reports and vague â€œconversationsâ€ and anonymous Wall Street â€œfriendsâ€, and basically asking Paulson to confirm his suspicions. Which, naturally, Paulson doesnâ€™t do, because the suspicions werenâ€™t actually true. That said, however, Paulsonâ€™s being-polite-to-the-Congressman answer doesnâ€™t explicitly say that Kanjorskiâ€™s numbers are false.
So the columnist admits that Paulson didn’t refute Kanjorski’s numbers OR the scenario he laid out.
And yet my fellow bloggers are more than willing to suggest the congressman is lying. Even when the numbers back up the scenario Kanjorski described.
Also, do this little thought experiment with me…why would the Bush administration essentially destroy Republican’s chances in the election by trying to push through this massive bailout plan right before the election if it wasn’t needed? Why would Bush say something as seemingly absurd on its face as “I’ve abandoned free-market principles to save the free-market system.”? Does any of that make any sense that any of this happened if a catastrophe wasn’t eminent? Of course it doesn’t.
Folks, whether you want to believe it or not…we were on the edge of collapse. Everything points to that as a matter of fact, not fiction.