Brad Warthen's Blog

The One's prime-time address to the nation

Dig the faux Oval Office! Better than the faux Greek temple, even! He couldn't have the Brandenburg Gate, but his folks sure can whip up a presidential-looking set, can't they? Gotta spend that money on something, and Obama's opted to burn some of it on a 30-minute Address To The Nation in Prime Time. Hey, why bother actually becoming president, if you can do cool stuff like this when you haven't even been elected?

Anyway, I'm gonna watch the rest of it now. I just thought I'd give y'all a place to comment on it.

Today's drop in the Dow: 733 points

bud wants to talk about the stock market today, so here you go:

NEW YORK -- Despair over the economy sent Wall Street plunging again Wednesday, propelling the Dow Jones industrials down 733 points to their second-largest point loss ever. Stocks fell on a combination of disheartening economic data, including a big drop in retail sales and a Federal Reserve report that said tight credit conditions are hurting businesses across the country.

The government's report that retail sales plunged in September by 1.2 percent - almost double the 0.7 percent drop analysts expected - made it clear that consumers are reluctant to spend amid a shaky economy and a punishing stock market.

The Commerce Department report was sobering because consumer spending accounts for more than two-thirds of U.S. economic activity. The reading came as Wall Street was refocusing its attention on the faltering economy following stepped up government efforts to revive the stagnant credit markets...

Me, I just get tired of the same stuff over and over. Stock traders must have the attention span of goldfish. Seems to me we already decided there was going to be a bad recession, and that the unemployment rate was going to go up, and consumers were unlikely to spend (because, if they're like me, they ain't got no money, not because they're "reluctant"), and credit would be really tight at least until the rescue money started circulating around.

But the guys on the stock market seem to wake up every morning and go, "What? Bad financial news? I had no idea! Let's all panic!"

And that gets tiresome.

What did you think of the debate?

My own quick take on it -- WAY more interesting than the presidential debate. Higher energy, and more engaging.

Both did well. Of course, that means more in the case of Sarah Palin, because we knew Joe knew his stuff. Joe's greatest danger was coming off as superior or condescending or ungentlemanly. Sarah's greatest danger was coming off as she did with Katie Couric. She didn't, and he didn't. They both did a fine job.

But what do YOU think?

Should Friday's debate be postponed?

McCain wants to postpone Friday night's debate until a bipartisan consensus can be reached on the bailout plan. Obama wants to go ahead. Both are meeting with President Bush Thursday.

Should they debate the next night? What do you think?

Here's a story on the subject:

The economic crisis and raw politics threatened to derail the first presidential debate as John McCain challenged Barack Obama to delay Friday's forum and unite to help Washington fix the financial mess. Obama rebuffed his GOP rival, saying the next president needs to "deal with more than one thing at once."

The White House rivals maneuvered Wednesday to claim the leadership role in resolving the economic turmoil that has overshadowed their campaign. Obama said he would proceed with his debate preparations while consulting with bailout negotiators and Treasury Secretary Henry Paulson. McCain said he would stop all advertising, fundraising and other campaign events and return to Washington and work for a bipartisan solution.

"It's my belief that this is exactly the time when the American people need to hear from the person who, in approximately 40 days, will be responsible for dealing with this mess," Obama said at a news conference in Clearwater, Fla. "It's going to be part of the president's job to deal with more than one thing at once."

But McCain said they must focus on a bipartisan solution as the Bush administration's $700 billion bailout proposal seemed headed for defeat. If not, McCain said ominously, credit will dry up, people will no longer be able to buy homes, life savings will be at stake and businesses will not have enough money to pay workers.

"It has become clear that no consensus has developed to support the administration's proposal," McCain said. "I do not believe that the plan on the table will pass as it currently stands, and we are running out of time."

President Bush invited both candidates to the White House on Thursday, along with congressional leaders, in hopes of securing a bill to rescue the economy. Bush took the unusual step Wednesday night of calling Obama directly to invite him, White House press secretary Dana Perino said. An Obama spokesman said the senator would attend.

In a joint statement Wednesday night, the candidates said the country faces "a moment of economic crisis," and called for political unity to solve it because "the jobs, savings and the prosperity of the American people are at stake." Both said the Bush plan was "flawed."

"We cannot risk an economic catastrophe," they said. "Now is our chance to come together to prove that Washington is once again capable of leading this country."

Sen. Lindsey Graham, McCain's representative in debate negotiations, said McCain will not attend the debate "unless there is an agreement that would provide a solution" to the financial crisis. Graham, R-S.C., told The Associated Press that the agreement would have to be publicly endorsed by Obama, McCain, the White House and congressional leaders, but not necessarily given final passage by the House and Senate.

Asked whether the debate could go forward if McCain doesn't show, Obama spokesman Robert Gibbs said: "My sense is there's going to be a stage, a moderator, an audience and at least one presidential candidate."

What did you think of Bush's speech tonight?

Basically, he said what he had to say, but did he sell it? CAN he sell it? Up until tonight, one reason Paulson and Bernanke were taking the lead was because of the president's diminished political capital.

Anyway, what did you think of the speech? If you missed it, here's the video.

Half a trillion? Whoa! That's more than I make in a YEAR

OK, I realize that's an old joke, but I just basically wanted to give y'all a post on which to react to the Bush administration's proposal for dealing with the crisis on Wall Street:

WASHINGTON -- Struggling to stave off financial catastrophe, the Bush administration on Friday laid out a radical bailout plan with a jaw-dropping price tag -- a takeover of a half-trillion dollars or more in worthless mortgages and other bad debt held by tottering institutions.

Relieved investors sent stocks soaring on Wall Street and around the globe. The Dow-Jones industrials average rose 368 points after surging 410 points the day before on rumors the federal action was afoot.

A grim-faced President Bush acknowledged risks to taxpayers in what would be the most sweeping government intervention to rescue failing financial institutions since the Great Depression. But he declared, "The risk of not acting would be far higher."

Here are several versions of the story:

• The AP version on thestate.com., the most gee-whiz version I've seen (unusual for the AP)
• The one from The Wall Street Journal
• The New York Times version.

I'm still scrambling here to get the weekend editorial and op-ed pages out, but in the meantime, what do y'all think? The market seems to like it, but those folks are easily excited...

Wall Street reaches its Wile E. Coyote moment

Responding to a recent post, Grandmaster Bud said:

I keep waiting for Brad to post something about the financial market meltdown....

Of course, bud wanted to the subject to come up so he could make some broad statement about the election, which he went ahead and made:

... Apparently the Phil Gramm approach to regulation isn't so great after all. And to think, if Bush/McCain had their way our Social Security funds would be in grave jeopardy now.

My response was to say that I already tried to give y'all a place to talk about that -- you know, the George Bailey thing -- but as I've made abundantly clear in the past, I generally don't comment on things having to do with Wall Street, because I don't understand it. That is, I sort of understand it, and what I do understand makes such little sense that I prefer not to go out on a limb offering opinions on such things.

But here goes anyway: I think markets are all a bunch of smoke and mirrors. Value is totally relative, so to me Phil Gramm and John Maynard Keynes make equal amounts of sense in this context. The value of something like Lehman is to me based on B.S. So the assets were overvalued -- big, freaking surprise. Samuel T. tried to explain it to me this morning this way: If your assets are valued at $40 million, but they're only worth $20 million, you're overvalued. I get it. And I also think it's a bunch of hooey. To me, the only value of a place like Lehman, shuffling its ones and zeroes around, is the buildings and office furniture and carpets and such that it owns, plus B.S. If people will pay you $40 million for your stock, it's "worth" $40 million. If they'll only pay you $20 million, it's "worth" $20 million. If they suddenly realize it's based on nothing -- like Wile E. Coyote suddenly looking down and realizing nothing's holding him up -- it's over.

One can say this about anything -- the monetary worth of anything is what people are willing to pay for it. It's true of comic books. And although I believe (as I have said) that comic books have an absolute value, I realize value is relative.

But when you've paid too much for your comic book and you're off the cliff and you look down, at least you've still got your comic book. With Lehman and Merrill and the rest, I'm not sure that you have anything at all.

By the way -- you know that Krugman column I wanted to run on the subject, but it got outdated? Well, I'm happy to say that I have a very solid Robert Samuelson piece on the subject for Wednesday's paper. In it, he explains why "Wall Street as we know it is kaput." My favorite part is when he says that after a crash like this, some good thing may happen in reaction. For instance, "Talented and ambitious people may move from finance, where they were attracted by exorbitant pay, into more productive industries."

That could only be good for the country.

How are we feeling about the Electoral College?

Back on my post about recent polls, I agreed with Phillip that what matters is NOT these national popular-vote numbers we're seeing, but how the candidates are stacking up in the battleground states. Then, I asked:

Taking that to another level -- while Phillip and I agree that the state-by-state is what matters, can we agree that the state-by-state is what SHOULD matter?

That one was a tough question to get folks to agree on in November 2000, but right now, when we don't know how this one is going to come out, how are we feeling about that old Electoral College?

So how about it. Without knowing yet how the popular vote comes out -- and it could go either way at this point -- how do YOU feel about the Electoral College? Good? Bad? Indifferent?

Personally, I think it's a fine thing. It forces a candidate to have appeal across the country, rather than just in a few population centers. At least, it's fine in the abstract.

Gallup shows McCain leading

This morning I see that, while Nielsen sees Obama and McCain tied in "buzz" (whatever that means), Gallup sees McCain leading by 5 points. A week ago, after the Democratic Convention and before the Republican, Obama had led by 7 points in the same poll.

From the USAToday story:

WASHINGTON — The Republican National Convention has given John McCain and his party a significant boost, a USA TODAY/Gallup Poll taken over the weekend shows, as running mate Sarah Palin helps close an "enthusiasm gap" that has dogged the GOP all year.

McCain leads Democrat Barack Obama by 50%-46% among registered voters, the Republican's biggest advantage since January and a turnaround from the USA TODAY poll taken just before the convention opened in St. Paul. Then, he lagged by 7 percentage points.

More on that "enthusiasm gap:"

Before the convention, Republicans by 47%-39% were less enthusiastic than usual about voting. Now, they are more enthusiastic by 60%-24%, a sweeping change that narrows a key Democratic advantage. Democrats report being more enthusiastic by 67%-19%

Discuss amongst yourselves.

Choosing Sarah Palin

Folks, I'm absolutely swamped, this being Friday morning, but I thought I'd give those of you with the time a place to discuss McCain's choice of ... let me go check her name again... Sarah Palin to be his running mate. Here are some conversation-starters:

• One thing's for sure, I don't have any video to share with you of Gov. Palin. Never met the woman.
• For a brief moment this morning, I thought maybe Bobby Jindal was back on the short list, when I saw this piece by him in the WSJ. (I know that's not logical, but the human mind is susceptible to the suggestion of coincidences.) That would have been cool, because it would have made the two tickets perfectly symmetrical -- McCain playing the role of Biden on the GOP ticket, and Jindal (young, charismatic, ethnic) playing Obama.
• Do you think McCain made a big mistake not beefing up his ticket's economic cred with Romney?
• Not that I want to attach a lot of importance to her gender, but it would seem that McCain is really, really serious about going after those disaffected Hillary voters, the ones who took HER gender very, very seriously.
• Where's Wayne Campbell when you need him for expert commentary on whether she, if elected, would qualify as the first babe to be a heartbeat from the presidency?

Talk amongst yourselves.