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Leather buckets used by President George Washington and his Volunteer Fire Brigade.
There's something about saying "No more bailouts" that appeals to the [l]ibertarian in everyone. Let Fannie Mae and Freddie Mac shrivel. What's Lehman Brothers got to do with me?
The trouble with this particular string of trouble is that it's impossible to know how much harm a failing Lehman Brothers, to name the latest belly-upper, would do to the global economy. Lehman Brothers insured loans for other banks, and now those other banks are running through their books trying to figure out whether they're still in business.
From our friends down the street at Slate comes the Big Money, a new site with the good sense to launch today, of all days. Chadwick Matlin and James Ledbetter kick things off with a tough message for bailout haters. They argue that the government should have saved Lehman. From Matlin and Ledbetter:
It is not unreasonable to think that tens of billions of dollars of capital will be wiped out across the globe on Monday as a result of Lehman's collapse; it is, after all, the first large Wall Street firm to go bankrupt in nearly two decades.
By helping Fannie, Freddie and — earlier — Bear Stearns, the government made a string of decisions to protect the economy from shock. By sitting this one out, say Matlin and Ledbetter, officials forced a major Wall Street firm into bankruptcy. The Big Money sums it up like this:
In short, Wall Street is entering into a brave new world in which the Federal Reserve, the Treasury, and even the Securities and Exchange Commission are vital players.
Which is kind of weird, when you think about it.