Friday, October 10, 2008

The financial collapse and the nation's collective conscious

Earlier today I wrote:

The depth of the bad assets that have been artificially inflated the past few years is staggering. It would be downright stupid -- sorry for the language, but it's true -- for an economic actor, any economic actor, to trust the financial system until substantive re-regulations occur. This is why pumping more and more money into the system, or cutting interest rates, will not alone fix things. This is not a problem of supply: it is a problem of sociological relations gone bad.

To this I want to add a bottom line, as we head into a much-needed weekend: The ideological position that the nation can trust financial organizations to regulate themselves will from here on out be anathema to the nation's collective consciousness. And I say that as someone who is about as close to a Greenspan-apologist as there is these days. But the the growing reality is that the economic system will not re-gain its efficient normalcy until it re-calibrates itself to the society that it serves. I hope we all have a great weekend.

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