Capitalism runs on trust, on confidence. It's the other fuel of the economy. Keeps it "regular".
So when I heard last week reports surface about bad loans "clogging" the market*, I was unsure what exactly that meant. It turns out that it means simply that banks were not lending to other banks anymore. No trust, since no one knows which banks have bad loans and what percentage is bad.
This is important because no bank, like no human, can stand alone. Each one has reserves far smaller than its outstanding deposits. So if some big investor or a lot of little investors ask for their money, that bank would have to borrow from another bank. If the bank can't borrow, then...well...can you say "bank run"? And, of course, all the banks in the United States together can't produce the deposits of all its depositors. That's part of why this is important to Main Street.
* - visions of my "toilet-poor" days come to mind
Another reason Peggy Noonan may be right in saying that most people don't think either McCain or Obama is qualified to be president is that both have gone AWOL from the Senate for about a year now without any discernable effect on the republic. Same with Hillary.
In fact, Obama was content to sit out the negotiaions regarding the financial bailout, a crisis that Warren Buffet calls "an economic Pearl Harbor". In other words, Barack Obama is so insignificant in the Senate in terms of expertise that he is not needed on arguably one of the most important bills of the last decade.
Or perhaps this is just indicative that the Senate is one of the easiest jobs anyone can aspire to. After all, Obama found time to write two books, one fairly serious. Not ghost-written. He's basically a full-time writer with a day job! Just how intellectually demanding can these Senate jobs be?
Not very, apparently. And if you look at the calendar in January, you see that there was a whole lot of nothing getting done. Mostly resolutions on order of congratulating the Super Bowl champions. You can't make it up.
(Of course as a conservative I'm not too upset about the lack of things that get done in D.C. since there's a great chance they muck it up. Perhaps it's a tinge of unwarranted envy or perhaps it's that they still find time to spend a heckuva lot of money.)
As Jim Curley recently wrote:
I am not sure either of "the candidates" are impressing many with their "leadership" during this "financial crisis". Both seem to be "responders" rather than leaders...Kudos now to John McCain in belatedly recognizing this and getting back to Congress give his input.