http://www.bloomberg.com/apps/news?pid=20601087&sid=a9MTZEgukPLY

If this is real– why the bailout? I can find little or no news on this.

Drive-time radio this morning was joking about “Learn to like the taste of Alpo” and “Get your money out of the bank While You Still Can”.

And the survivalist crazies are all coming out of the woodwork (or at least from Art Bell’s 3AM phone lines) at the same time.

Tip: Any phrase starting with “Coming One World…” is Christianese for “HERE COMES THE ANTICHRIST!” End-of-the-World rant coming up.

Tip: The phrase “Worthless Government Fiat Currency” or “Wheelbarrows of banknotes” is Libertarianese for pretty much the same thing.

You know it’s getting really crazy when your financial planner starts talking about “You know we’re living in The End Times…”

Since when has the government been concerned about “average Americans”? Average Americans have been losing their jobs and their homes for months, even years now. They have been told to retrain for “21st century jobs” in the “new economy.” But now, suddenly, when Wall Street starts feeling pain, there’s no talk about bankers and brokers “retraining” for jobs in the “new economy.” Suddenly there is a national crisis.

If this crisis will affect you and I, imagine — just IMAGINE — how deeply it will affect those at the top. It must be a pretty long and sharp thorn that Wall Street is sitting on to make all those deregulationist free-marketers run to Washington for a government program.

Methinks that many average Americans have been in crisis for some time and the poison pen filled with red ink has simply finally touched Wall Street. The solution is NOT to dump money into the system at the top. That’s like trying to heal a drought-stricken plant by soaking the leaves.

What has impressed most people about this whole business is that they know that Wall Street never gives a damn about Main Street. If a factory closes in Ohio because it was cheaper to ship the jobs to China, Wall Street rejoices because it knows that corporate profits will rise and stock values will go up. But when the Ohio workers lose their homes because they lost their jobs and those failures affect mortgage-backed securities, THEN Wall Street cries foul and wants a government welfare program called “Financial Security” to immunize them from what will probably be catastrophic losses. Tough.

The “pain” that I hear average Americans will suffer is an inability to get a car loan or a home loan. (Big deal. I can wait. I don’t need to buy a house or a car right this minute. I can rent. I can buy a cheap used car.) Some small companies may not be able to get a loan to make payroll and some folks will lose their jobs. That’s it.

Isn’t that just business as usual? Lots of people can’t get home and car loans. That’s nothing new. And lots of businesses can’t make payroll on a steady basis, especially in the construction industry, where contractors often have to wait in a line of a string of subcontractors before they can pay their workers. That happens all the time. And guess what? Workers keep working until the money trickles in.

The idea that banks will stop lending is silly. Banks HAVE to lend. That’s why they exist. If they don’t lend, then they can’t make money and they’ll go belly up anyway. So banks will ALWAYS continue to lend to anyone with excellent credit.

If a business is so cash-poor that it has to get a loan to make payroll, and so credit-poor that it can’t get a loan, then it probably shouldn’t be in business anyway. Lending to such borrowers is part of what got us into this mess in the first place. Those businesses SHOULDN’T be getting loans. The number one reasons all businesses fail is lack of adequate cash flow. That has always been true, even in non-crisis times.

I just don’t hear anything from Washington that suggests to me that there is a real — or rather a NEW — crisis, that anything is happening that hasn’t been happening for a long time. What I hear is that the consequences of some very bad decisions have finally touched some very, very wealthy people and they are scared to death.

That’s no reason to BORROW another $700 billion from China, adding to our multi-trillion-dollar national debt, to buy up a lot of worthless securities so various banks’ balance sheets can look rosy again.

No, I think the tightening of the credit markets is a good thing. There’s been too much money flying around the past ten years or so. Too many bad borrowers, too many over-leveraged companies, too many risky investments, too much so-called “growth” that is nothing more than a lot fluffy nothingness masquerading as business. It needs to stop.

We can all do our part. Let’s skip Christmas and find 1001 recipes for beans!

I’m not an economist, but I do believe in watching what people do rather than what they say.

We’re told that this is a crisis and that, if we don’t act now, we’re headed for Great Depression v2.0 (oh, and we won’t get the lifetime supply of free towels). Yet:

1 – The dems initially tried to pork up the bailout with HUGE payouts to their favorite constituencies. Politics as usual.

2 – The GOP members of the House weren’t even invited to the initial negotiations. Politics as usual.

3 – Nearly half of the filthy democrats didn’t vote for it, and there is no evidence that their leadership did much to persuade them to close ranks and vote “yes”.

4 – The Senate didn’t even schedule a vote on it, apparently waiting for the House so they could see which way the wind was blowing. Politics as usual.

5 – Despite the “urgent” need for action, the Congress is taking the next two days off. Business as usual.

6 – SanFran Nan didn’t bother to try to rein in her big mouth for a change. Politics as usual.

7 – There has been little or no serious discussion of overhauling the system, or even trying to determine what happened and why. Instead, it looks like business as usual after we get hosed with a $700 billion bill.

When we’re assured that we face a crisis but everybody involved is carrying on “as usual”, it’s pretty good evidence that the crisis isn’t that bad.

I’m not convinced, and I’m sure as hell not comfortable giving Uncle Sugar that much money without some solid evidence of reform. I don’t want to hear any, “Give us the money now and we’ll take up reform later”, ‘cuz I don’t believe it. I don’t trust Bush, Paulson, or Bernake, and I sure as hell don’t trust Pelosi, Reid, Dodd, or Frank.

When that collection of thieves and liars starts acting like it’s a real crisis, give me a call. Until then, keep your damned dirty paws off my wallet.

And that’s Nancy Pelosi’s fault?

Keep smoking.

But the reason it matters is the reason markets work at all — appearances, not reality, drive psychology.

We trust a piece of paper is worth a dollar. We trust the other driver will stay on the right side of the yellow line. Lose trust and you can’t function.

Which is why the Fed/Treasury plan fails. It seems to get markets moving, but it destroys the basis for free markets; everyone will know the government will pay for all errors. Heads the investor wins, tails the taxpayer loses.

Guess what happens to speculation in THAT environment.

The downside is that we re-play the Japanese blunder, where “tatamae” (appearances) trumped “honne” (truth). By denying their banks had bad loans, they went into a nearly two decade slump.

Better the cleansing light of day.

I do know, however, that the DOW is up this morning.