"That's what a Congressman or a Senator is for -- to see that too much money don't accumulate in the national Treasury." ~ Will Rogers
Exclusive to STR
When I was very little, I went to a parade with my parents and grandparents. By all accounts, I was quite taken with the clowns, who threw candy at us. The brightly colored little nuggets flew all over. I picked up some of the candy and flung it back at the clowns. Most children would have kept the confections, but I did not know what they were. I thought the game was to throw stuff back and forth between the clowns and myself. My father is a dentist, and such candy was not permitted at home, so my ignorance created a story often told among family members. I expect my teeth would have thanked me, were they able to speak and reason for themselves.
Casting back the clown candy is almost the same as banks, or any other business, refusing assistance from the government. They are offered what looks like free money. Only a crazy person would turn it down. Yet, some banks have shown enough integrity to stay away. So far, the numbers are tiny. A paltry 1 billion dollars has been refused, but the numbers are still wonderful to my ears, even though they represent less than 1% of the bailout total. New York Community BankCorp Inc. alone refused $596 million.
Most banks, however, are doing exactly what the children at the parade without dentists for parents did. They are getting as much candy as they can as fast as possible. Like a child who has eaten so much sugary junk he is ill, but continues to eat because it tastes so good, banks are taking the money and not considering just how sick it might make them. They made horrible mistakes, and as a reward, they were handed a giant pile of cash. Our government has given banks lots of incentive to make further mistakes. If they screw up even more, they might be given a bigger heap of money next time around.
Soon, I envision huge bailout creation parties where banking executives compete to waste as much money as possible. They will dance around in remote tropical locations drinking 200-year-old scotch right out of the bottle, eating polar bear steak, and wearing hats made of folded $100 bills.
Such hats may be the best use of the US dollar in a few years. As more companies and industries are bailed out, our currency will inflate like mad. If you thought it was bad before, get ready. The clowns will be tossing pretty green paper at everyone until it is plentiful and worthless.
In the meantime, put your money someplace safe, probably not the dollar. Any cash you must keep should be placed in a bank which refused the clown candy. As an upset and irritated taxpayer, I thank you.