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You Shall Not Press Upon Wall Street This Inflation-Hawk Crown Of Thorns

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When it comes to making strange bedfellows, modern finance makes politics look like an old-fashioned match-maker. The most famous words on the current financial turmoil came not in the form of a political speech from a major presidential candidate, but from Jim Cramer, a former hedge fund manager turned popular CNBC stockpicker and market prognosticator. His five-and-half minute call for the Federal Reserve to cut interest rates, however, strangely recalls the most famous political speech of an earlier era—William Jennings Bryan’s 1896 “Cross of Gold” speech before the Democratic National Convention in Chicago.
The emotional desire of the nineteenth-century populist movement Bryan led was to smash the power of Plymouth Rock, which stood for old New England and Wall Street. The emotional desire of what Dan Gross has called “the Punch Bowl Caucus” is to cut interest rates—return the punch bowl—to jazz up the Wall Street party again. But they share an emotional tone—and, more importantly, an economic goal: the loosening of a monetary policy they claim is so tight it is ruining ‘their people.’
Gross’s essay nicely describes the membership of the Punch Bowl Caucus: Wall Street investment banks, hedge fund traders, private equity managers, the chief executives of heavily indebted automakers, the heads of home loan businesses, supply-siders who believe “the government should never intervene in the economy, unless it is to bail out hedge funds and investment banks,” and internationalists who worry about what would happen to the developing world if Americans suddenly quit spending their earnings on foreign goods.
Since they share an emotional tone and the goal of loose money that inspired the old Populism, but differ in their background, let us adopt “Wall Street Populism” as the proper term for the Punch Bowl Caucus. It is, after all, something of a Free Silver movement with gilted edges.
There are, of course, crucial differences. The old populist were openly egalitarian radicals while the Wall Street Populists are openly elitist radicals—concerned about the jobs and firms of people who have been in the financial industry for, as Cramer put it, “twenty-five years.” The old populists viewed Wall Street and the railroads as their enemy. The Wall Street Populists are, well, closely tied to Wall Street. The old populists spoke in the eloquent and evocative images built from the Christian tradition. The language of the Wall Street Populists is less burdened by syntax, tradition or allusion.
That the cause of looser money gone from those who wished to smash Plymouth Rock on the Grand Canyon to those who want to keep Wall Street afloat on free credit shows how different twenty-first century finance is from nineteenth century finance. You know that Wall Street long ago stepped through the looking glass when a hedge fund manager adopts the cause of William Jennings Bryan. We’d call it “unreal” except that it is all too real.
The Punch Bowl Caucus [Slate]