Charlie Gasparino Is Boycotting This Morning's Speech Downtown

Posted by Bess Levin, Sep 14, 2009, 12:15pm

gasparino.jpgThat, or if the camera pans back, he's moments away from bum rushing the stage prior to being manhandled by the Secret Service. Why? Because what Mr. Obama is saying is a crock and Chazza would rather be bound and gagged in the backseat of a Buick than listen to it with the other sheep. Also, he's just got better things to do with his time, like get back to his fighting weight for the next Golden Gloves tournament. This is his year.

President Obama is speaking tonight, apparently to assure us all that his administration has the financial crisis resolved. Don't bet on it.

[...]

Wall Street will tell you that times have changed. One chief culprit of the financial collapse, "leverage" -- borrowing to finance risk-taking activities -- is way down these days, so the risk of losses spreading to dangerous levels has been minimized. Maybe so, but that won't last -- because it never does.

In economic circles, the problem is known as "moral hazard." Average Americans will call it common sense. And common sense tells me that, given the nature of the last year's bailout, moral hazard has been created on an unprecedented scale -- setting the system up for a bigger demise somewhere down the road, when the memory of the horrible weeks following Lehman's bankruptcy is forgotten.

It's not just that Wall Street has a short memory -- the last bailout made things worse: The federal safety net is no longer merely the promise to cut interest rates to rockbottom levels or prod firms to bail out a wayward hedge fund. After Lehman's bankruptcy, the feds panicked and created the biggest safety net of all time.

Don't worry though. Gaspo's got a plan. He's floated it before, but why not again today. It's pretty genius and to the big timers reading this, please feel free to get in touch and discuss it further. San Pietro, 5 o'clock. You're buying.

Goldman Sachs is now a commercial bank, meaning it's regulated by the Federal Reserve and viewed as too big to fail. Ditto for Morgan Stanley, which just hired all those traders and salesmen to take risk -- and did it with the imprimatur of the federal government.

There is, of course, a simple solution to all this: Goldman, Morgan and the rest of the "banks" should either become hedge funds -- with no backing from the federal government and taxpayer funds when they engage in risk -- or start handing out debit cards and toasters and become real commercial banks by concentrating on signing people up for checking accounts, instead of trading esoteric bonds.

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