I
was going to post a nice flower picture! But NO POWER SUPPLY and NO WEBSERVER means
solarbird something something.
Anyway,
the commercial real estate lending markets didn't like the rate cut one little bit. (Remember, on these graphs, up == bad.) That angle-change in the sharp spike up is yesterday. I've heard but cannot validate that interbank lending has fallen over almost completely at this point. (Ye Olde Tyme
residential CDO/etc markets are near or below record lows, so that's not better either. On these graphs, down == bad.)
The rate cut
did manage to bump
Bank of America's 95% earnings drop and Wachovia's 98% earnings drop. God
damn. Normally, that'd have been market-shattering news, but today? Lost in the noise. Financials were up today, and so were companies like Countryside, despite
foreclosures finally starting to spike 500% in California markets. In addition to the predictable
farewell trashings, both BoA and Wachovia have been talking about
homeowners walking away from negative-equity homes, even when they have the "capacity to pay, but have basically just decided not to."
In that last, I have a completely unsubstantiated thought that maybe people have watched two sets of law fall into place, one for most people, and one - or the lack of one - for large corporations and their uppermost management. In that upper realm, failure is rewarded on the backs of investors and 401K plans (
Countrywide CEO Angelo Mozilo, I'm looking in your direction), and collaboration in fraud
isn't cause for civil claims by defrauded investors. In the lower realm, bankruptcy laws are rewritten by the lenders themselves to to let credit card companies p0wn your ass forever. And, for that matter, I'm going to reach even further and mention Congress's plans for
retroactive telecom industry immunity for blatant lawbreaking, and the general lawlessness of the political realm in its entirety. So I wonder if maybe some people have decided,
Y'know what? Fuck it. I'm not gonna play either.I have no evidence for this, I certainly have no way to get it, and I'm not going to call it a serious analysis. But it's my first reaction. If true - or even if perceived to be true, whether true or not - this will have the effect of making credit higher risk and hence more expensive, helping push along the vicious cycle.
(And before some people ask: why is this different from Bill Clinton's blowjob? Because really, while the gods know Monica wasn't the only person Bill Clinton screwed - his revisionist lies about "don't ask, don't tell" to the contrary (and let's not even get into DOMA) - on that matter, really quite few people got fucked over. The financial insanity of the last half decade - spawned in part by the failure to punish and enforce the cronyism and fraud of the previous half decade - is in the process of sucker-punching
everyone. That's what's different.)