Saturday, November 22, 2008

Losing His Religion

Not sure if Henninger has some sort of bet with Goldberg over who can write the dumbest imaginable column, but it's a hell of a farting contest.

This year we celebrate the desacralized "holidays" amid what is for many unprecedented economic ruin -- fortunes halved, jobs lost, homes foreclosed. People wonder, What happened? One man's theory: A nation whose people can't say "Merry Christmas" is a nation capable of ruining its own economy.

One had better explain that.

Yes, one supposes one had better, though one doesn't really need to. One assumes that had this not been an election year, the War On Christmas goofballs would have come out of the woodwork a day or two after Halloween. Perhaps Henninger is attempting to paraphrase the old Chesterton saw that people who don't believe in something will believe just about anything. I suppose his continued employment is proof enough of that.

The path to 50% wealth reductions and the death of Wall Street was paved with good intentions, notably the notion that all should own a house, even if that required giving away the house to untutored borrowers with low-to-no-interest loans.

This good intention set off history's largest chain of moral hazard. The great unraveling began sometime between 2005 and 2007, when borrowers, lenders and securitizer shamans all found themselves operating in a zero-gravity environment, aloft on moral hazard.

For a professional scold, Henninger leaves this treacherous path from "good intentions" to "moral hazard" remarkably (if unsurprisingly) uncharted. To hear these bozos who blame the entire collapse on Fannie Mae and Freddie Mac -- that is, the federal subsidizing of the working and lower-middle classes, as opposed to seven-figure Wall Street douchebags -- you would think that these poor, helpless bankers had been forced at gunpoint to grant no-money-down, no-questions-asked liar downs to people who couldn't calc out a simple debt-to-income ratio.

This sort of client vetting used to be the job of a person called an account manager, or a loan broker. It required awareness of the local market, the likelihood of regional overvaluation and imminent market corrections, and even somewhat rigorous oversight of the client's ability to pay the goddamned loan back in the first place.

Instead of doing those things, they sent people out -- again, apparently against their free will and rational self-interest -- to find suckers to sign on to these things, loaded with precipitous rate adjustments and payment schemes. The lure was the ability for those folks to then use their new house as an ATM to buy shit whose value would never be recouped. Vacations, new SUVs, whatever you need, baby. You've earned it.

Then the bad loans get bundled into a bunch of Excel hocus-pocus, and everyone shrugs their shoulders and wonders how this brilliant Ponzi scheme could have failed. Jesus H. Christ, it's actually surprising that it held out for as long as it did.

Anyway. Good intentions. Road to hell. Mad Max. Gotcha.

What really went missing through the subprime mortgage years were the three Rs: responsibility, restraint and remorse. They are the ballast that stabilizes two better-known Rs from the world of free markets: risk and reward.

Responsibility and restraint are moral sentiments. Remorse is a product of conscience. None of these grow on trees. Each must be learned, taught, passed down. And so we come back to the disappearance of "Merry Christmas."

It has been my view that the steady secularizing and insistent effort at dereligioning America has been dangerous. That danger flashed red in the fall into subprime personal behavior by borrowers and bankers, who after all are just people. Northerners and atheists who vilify Southern evangelicals are throwing out nurturers of useful virtue with the bathwater of obnoxious political opinions.

I'm almost on their side; Christmas would probably be more pleasant and meaningful if it were celebrated more like European countries do, with sacred cantatas and motets in impossibly old Romanesque cathedrals, ancient festivals of deeper cultural significance. But the culture of consumerism -- a culture, coincidentally enough, perpetuated in part by Henninger's own corporate bible and its clientele -- demands that we hang out in front of Wal-Mart for hours in the early post-Thanksgiving dawn, buy as much cheap shit as we can find, and culturally bond over the same Charlie Brown and Rudolph specials we've seen a thousand times.

And while Henninger has a reasonable point regarding the "R's", the first three were just as readily eschewed by the suits at the top as they were by the grasping rubes at the bottom. But only one of those groups is getting bailed out, the group who always, always finds ways to socialize the risks and pocket the rewards for themselves.

It has nothing to do with any spiritual belief, or lack of same, but rather it's symptomatic of a culture without an underlying ethos in general, secular or sacred. We've been conditioned for decades to buy stuff we don't need with money we don't have in order to die with the most toys or whatever, and now that everyone who hasn't yet filed for bankruptcy has gotten a clue and pulled back, now the problem is Not Enough Jeebus. Indeed, the megachurch mentality of reaping one's rewards while sucking up to an anglicized, idealized Jesus-like avatar, instead of letting virtue be its own reward, might have something to do with this as well.

Henninger and the rest of the Christmas Cops might do well to turn their stern gazes upon their own flock, who seem to have gotten the wrong idea about the ethical basis for their institutionalized superstitions.


Marius said...

It required awareness of the local market, the likelihood of regional overvaluation and imminent market corrections, and even somewhat rigorous oversight of the client's ability to pay the goddamned loan back in the first place.

I think they kind of knew that, Heywood. But they went ahead and baited the chumps anyway with impossibly sweet offers with the nasty shit hidden deep in the fine print. And why wouldn't they? Thanks to deregulation (repackaging debt into securities, CDS, etc.)and a gigantically wrong assumption about the past, they stood to win either way. (1) Either the chumps they gave mortgages to will default on their mortgage, and the bank gets to keep all the sucker's equity plus a house everyone thought would increase in value (the mistaken inference from past performance); (2) or they'd lose money from mortgages defaulted on, but then people like AIG would be expected to compensate them for their losses.

The whole house of cards began to fall at the top, but you wouldn't know if from Henninger. Perhaps he's really just a fucking moron, like most of the shitheads at WSJ these days. A more sinister conjecture is that he, like his fellow dipshits on the Right, are quietly revising recent history, building the new GOP consensus that it was the Blacks and Latinos who brought down the investment market. Reagan did it with his Cadillac welfare queens, and nobody called him out on that.

It wasn't us, it was those broke-ass Afros! -- that'll be the new mantra on righty blogs starting soon, I suspect.

Heywood J. said...

It wasn't us, it was those broke-ass Afros!

Yeah, I've already been hearing that one from some of the righties around here. Coded with the "Fannie Mae" bit, obviously. Limbaugh and Savage, man, that's all these pricks listen to for "news". The rest of the planet is lying to them.

I just respond with the fact that the derivatives market had leveraged $62 trillion -- more than the entire actual on-the-books world economy -- at the time of collapse, and politely ask how that's all the fault of Fannie Mae and Freddie Mac. Well, sputter, fume, ya know, still....uh, the Democrats made 'em do it. Held an assault weapon to their collective heads, really.

I assume that some of the more enterprising Wall Street welfare queens will take their bailout money, buy up as much foreclosed property as they can, and turn it all around and pump the market back up. After finding and/or creating new and better regulatory loopholes, of course.

So yeah, win-win for them, as long as we keep putting up with it, vainly hoping that our crumb allowance hasn't been rescinded. Bad, naughty peons! No heavily leveraged suburban crackerbox for you, unless you sign here.

And yeah, while I don't read Henninger regularly, I haven't read anything yet that didn't place him firmly in the Goldberg paste-eater camp. Complete imbecile; he seems to be O'Reilly minus a personality. Revision is all they've ever had, since facts don't discourage them from lying.

thedevilzone said...

Sadly, No!:

Angry Black Man: Gimme my loan!

Terrified Banker: Please calm down, sir. I can’t punch in the numbers when my hands are trembling from fear.

ABM: Shut up, bee-yatch! You best type in dat numberology and get me dat money!

TB: It’s done, sir. Your loan is approved.

ABM: Damn straight, muh-fuggah. Now listen up, white boy, and listen good! While you at it, you best be swapping derivatives based on the outstanding debt package I’s just provid-o-lated you wif, and den you kin jus’ leverage dem addition-a-mated paper holdings anutha couple dozen times just to be sho’ you getting all de cash-money juice you can while da gettin’s good, so’s we all happy in this here financialical trans-mogrifa-taction!

TB: But … but, sir! That would be a most irresponsible dereliction of this firm’s fiduciary duties! And it would likely lead to economic disaster!

ABM: Honkey, you best be doing what I done tol’ you to do wif regards to yo fiducia-malogical duties, or I will have B-Frank Da Funky Fixah on yo’ gofay ass like white on rice!

TB: I see. Well, excellent advice, sir! Will you be requiring a $100,000 credit line today, too?

ABM: Casper, please! Hells yeah I be needing that credit line!

Marius said...

You're onto something with that thing about talk radio -- I think Nate Silver made a similar, although more general, claim recently:

..There are a certain segment of conservatives who literally cannot believe that anybody would see the world differently than the way they do. They have not just forgotten how to persuade; they have forgotten about the necessity of persuasion.

... the distinguishing feature of radio is that it exists in a sort of perpetual amnesiac state. In a book, you can go back and read the previous page; on the internet, you can press the 'back' button on the browser. In radio, there is no rewind: everything exists in that moment and that moment only. This is, theoretically, a problem with teleivsion too, but in teleivison you at least have context clues -- graphics and what not....