Can anyone get rid of these pesky meddlers?

The reason we need a collapse on Wall Street is that it’s the only way for the economy to get back on its feet.

The Great Correction has to correct.

It has to clean up the mistakes. It has to sweep out the debris. It has to un-screw up the economy.

Who screwed it up? The fixers... the world improvers... the meddlers... the Democrats and Republicans... 

Now, stocks have to fall. Banks need to go out of business. Companies need to go broke... and households need to default...

Asset prices need to go down. Unemployment needs to go up.

The pieces have to fall... or you can never pick them up.

If the feds would just leave well enough alone Mr Market would have handled the whole thing. And we’d be out of this Great Correction by now. He would have knocked down almost all of Wall Street. He would have put dozens of our leading companies into Chapter 11... blown up trillions of dollars in derivatives... and forced thousands of bankers, brokers, businessmen and hedge fund managers into early retirement.

That problem of unequal distribution of wealth... the rich getting richer, and all? He would have taken care of it!

And he would have done it all in a few short weeks in late 2008. By now, we’d have full employment again. And people building real wealth.

In other words, if the feds had not poured trillions of dollars down so many rat-holes... good money after bad... the whole thing would be over by now. We’d have a growing economy. We have real businesses producing real stuff... and paying real wages to real workers.

But the feds are on the job. And the job they’re on is to protect their voters... and their campaign donors... from Mr Market.

Of course, all they can do is delay the fix. They can make the problem worse. They can make the losses bigger. But they can’t fix anything.

Fixing requires pain. And the feds try to avoid pain at all costs... especially when they are the ones who will feel it.

So, they borrow and spend... and then print and spend... until the whole thing blows up.


Bill Bonner