Sophisticated financial analysis it isn’t; heartfelt, however, it is. Moe Tkacik went on the rampage yesterday afternoon, speaking for the unmoneyed everywhere when she told Ben Bernanke to, well, I’ll let her say it:
Fuck the Street. Please, Ben Bernanke, just fuck them. Raise interest rates to fucking 10% for the month if you must…
I wouldn’t say this if I hadn’t thought about it at least as hard as the average overleveraged hedge fund short-seller when he pushed down on the panic button that got us into this mess, Ben Bernanke.
And by "us," I mean Bear Stearns, because I personally have weighed the odds and I’m pretty sure I personally have nothing at stake here, no matter what you do, Ben Bernanke.
What Moe wants, not unreasonably, is some measure of comeuppance for the arrogant bankers who have lorded it over New York for so many years.
You don’t have to play rough; I’m not asking you to nationalize any industries or institute land reform or anything, just give them a little scare. They chose this path, you know. They chose to worship Ayn Rand and wear those Paul Smith shirts and pay zero money down on their Hamptons summer homes and obnoxiously, whenever confronted by someone like myself at a bar, claim that the Market Solves Everything. Let the market solve this one for them. People are eating dirt for dinner in Haiti, Ben Bernanke; you can let Bear Stearns go to bankruptcy court.
Moe might not have all her facts right – I don’t think it was short-sellers who brought down Bear Stearns – and crucially she’s wrong that a complete implosion of Wall Street wouldn’t affect her. Without those bankers’ income taxes, New York City would run out of money very quickly indeed, and some vital public services would have to get cut very quickly.
On the other hand, I do have sympathy for where Moe’s coming from. I’m going to be spending the summer in a city much like the one Moe would like to see: Berlin. It has no money, but that means that it’s cheap, and that it has loads of creativity and vibrancy. If Moe lived in Berlin, she might want a bit more in the way of opportunities and a bit less in the way of unemployment: the grass is always greener, and all that. But at the margin she’s probably right that New York’s center of gravity would benefit from moving just a little bit away from the plutocrats and towards the majority of the population.
In any case, Wall Streeters have trumpeted their dog-eat-dog lifestyle for so long that it’s silly for them to expect much sympathy from the rest of the country now that they’re facing layoffs. Even Andrew Samwick, a very financially-sophisticated Republican, has this to say about Bear Stearns:
Two questions immediately come to mind: Is this fair, and should we care? The question of fairness is easier to answer — of course it isn’t fair. Bear Stearns’ fall from grace was its own fault. It was the high-wire act in a leverage-soaked financial carnival.
And yet those in the corridors of power have intervened on the perpetrators’ behalf. Some people call this "socialism for the rich." Even that’s too generous — under socialism, the rich would be paying higher taxes during the boom times. No, "fairness" is not a word that describes this bailout.
What this means is that Bush and Paulson are going to be very wary of spending any money on Wall Street rescue packages. It’s almost impossible to think of something which would be more universally unpopular.