ÿþ<html> <head> <meta http-equiv="content-type" content="text/html;charset=iso-8859-1"> <title>OnlineColumnist&reg;.com: Iraq's Exit Strategy</title> <meta name="generator" content="Adobe GoLive 4"> <style type="text/css"> .style1 { font-size: x-large; font-weight: bold; } </style> </head> <body bgcolor="white" vlink="black"> <center> <table cool width="624" height="2719" border="0" cellpadding="0" cellspacing="0" gridx="16" showgridx gridy="16" showgridy> <tr height="79"> <td width="133" height="118" rowspan="2" valign="top" align="left" xpos="0"><a href="aboutdiscobolos.html"><img height="110" width="62" src="images/discobolos.logo.transp.gif" border="0"></a></td> <td width="7" height="118" rowspan="2"></td> <td width="482" height="79" colspan="2" valign="top" align="left" xpos="140"><img height="75" width="450" src="images/banner.GIF"></td> <td width="1" height="118" rowspan="2"></td> <td width="1" height="79"><spacer type="block" width="1" height="79"></td> </tr> <tr height="39"> <td width="182" height="39"></td> <td width="300" height="39" valign="top" align="left" xpos="322"><a href="aboutdiscobolos.html"><img height="14" width="267" src="images/divisionofNEW.GIF" border="0"></a></td> <td width="1" height="39"><spacer type="block" width="1" height="39"></td> </tr> <tr height="24"> <td width="624" height="24" colspan="6" valign="top" align="left" xpos="0"> <table border="0" width="100%" bgcolor="black" cellspacing="0"> <tr> <td> <table border="0" width="100%" bgcolor="#99ffcc" cellspacing="0" cellpadding="4"> <tr> <td align="center"> <div align="left"> <a href="index.html"><font face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular" size="2"><strong>HOME</strong></font></a><font face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular" size="2"><strong> &#149; <a href="articlesindex.html">ARTICLES</a> &#149; <a href="books.html">BOOKS</a> &#149; <a href="teflon.html">THE </a><a href="teflon.html">TEFLON</a><a href="teflon.html"> REPORT</a> &#149; <a href="mailto:letters@onlinecolumnist.com">REACTIONS</a> &#149; <a href="aboutdiscobolos.html">ABOUT DISCOBOLOS</a></strong></font></div> </td> </tr> </table> </td> </tr> </table> </td> </tr> <tr height="2"> <td width="133" height="2"></td> <td width="489" height="2576" colspan="3" rowspan="2" align="left" xpos="133" content valign="top" csheight="2573"> <font size="5" face="Arial,Geneva,Helvetica"><b>Bailout&#39;s Done-Deal</b></font><p><b><font face="Arial,Geneva,Helvetica">by John M. Curtis</font></b><font face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular"><b><a href="books.html"><br> </a></b></font><font face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular"><b>(310) 204-8700</b></font></p> <p><font size="2" face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular"><i>Copyright September 30, 2008<br>All Rights Reserved. </i></font></p> <p class="MsoNormal"> <b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </b><span class="style1">F</span>alling off her high-wire act, House Speaker Nancy Pelosi (D-San Francisco) rubbed too much salt in GOP wounds, causing the backlash that resulted in the bailout bill going down to defeat [228-205] Sept. 29.<span style="mso-spacerun: yes">&nbsp; </span>Wall Street promptly returned the favor, dropping the Dow Jones Industrial Average a whopping 775 points.<span style="mso-spacerun: yes">&nbsp; </span>Proving that Wall Street has a mind of its own, the market rocketed back Sept. 30 485 points, proving, if nothing else, that markets don t need a bailout plan to buy-or-sell.<span style="mso-spacerun: yes">&nbsp; </span>Expectations that a second bailout was underway helped jolt fund-managers to start buying again.<span style="mso-spacerun: yes">&nbsp; </span>President George W. Bush, Federal Reserve Board Chairman Ben S. Bernanke and Treasury Secretary Hank Paulson all warned of economic disaster should the bailout die in the House.<span style="mso-spacerun: yes">&nbsp; </span>Recent market gyrations show that Wall Street has its ways of forcing Washington s hand.</p> <p class="MsoNormal"> <![if !supportEmptyParas]>&nbsp;<![endif]><span style="mso-tab-count:1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </span>Bailout advocates warn of an economic nightmare should the House fail to pass urgent legislation.<span style="mso-spacerun: yes">&nbsp; </span>Monday s massive sell-off says more about how Wall Street operates than the state of the economy.<span style="mso-spacerun: yes">&nbsp; </span>Most economists differ on whether a failure to pass bailout legislation would result in the doom-and-gloom expressed by Bush, Bernanke and Paulson.<span style="mso-spacerun: yes">&nbsp; </span> I recognized this is a difficult vote for members of Congress, said Bush, urging Congress to pass the legislation.<span style="mso-spacerun: yes">&nbsp; </span> But the reality is we are in an urgent situation and the consequences will grow worse each day if we not act, continuing the coercion to force the House s hand.<span style="mso-spacerun: yes">&nbsp; </span>Both Republicans and Democrats don t trust handing over $700 billion to the White House to arbitrarily decide where the money goes.<span style="mso-spacerun: yes">&nbsp; </span>Billions of missing dollars in Iraq shows that the White House doesn t take protecting taxpayer dollars too seriously.</p> <p class="MsoNormal"> <![if !supportEmptyParas]>&nbsp;<![endif]><span style="mso-tab-count:1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </span>Driving the market up 485 points proves beyond any doubt that Wall Street is manipulated by programmed trading, not individual investors.<span style="mso-spacerun: yes">&nbsp; </span>Bernanke announced that the Fed was adding more that $600 billion to banking reserves to improve corporate liquidity.<span style="mso-spacerun: yes">&nbsp; </span>Congress knows opposition to a taxpayer-stuck bailout is running two-to-one, yet Bush continues his unrelenting pressure.<span style="mso-spacerun: yes">&nbsp; </span> If the bailout outright failed, Wall Street would continue selling-off, eventually hitting a new bottom.<span style="mso-spacerun: yes">&nbsp; </span> After Sept. 11, it took a year-and-a-half befire the Dow dropped from 11,750 to 7,770, sometime early 2003.<span style="mso-spacerun: yes">&nbsp; </span>From its low, it took four years for the market to peak July 17, 2007 at 14,000.<span style="mso-spacerun: yes">&nbsp; </span>If the bailout passes, it s possible that it would delay the inevitable bottom, pushing the next<span style="mso-spacerun: yes">&nbsp; </span>bull market into the indefinite future.<span style="mso-spacerun: yes">&nbsp; </span>Wall Street figures out when the market drops too much, causing a buying opportunity. </p> <p class="MsoNormal"> <![if !supportEmptyParas]>&nbsp;<![endif]><span style="mso-tab-count:1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </span>Wall Street s major funds don t like safe-havens like treasury bills.<span style="mso-spacerun: yes">&nbsp; </span>They prefer buying low and selling high, the endless game played by the major funds all setup on programmed trading.<span style="mso-spacerun: yes">&nbsp; </span>I m told a number of people who voted  no yesterday are having serious second thoughts about it, said Senate Banking Chairman Christopher Dodd (D-Conn.), after the market took its Monday nosedive.<span style="mso-spacerun: yes">&nbsp; </span>What Dodd doesn t admit is that many House Republicans fear a backlash at the polls in November should they vote for the legislation.<span style="mso-spacerun: yes">&nbsp; </span>Unlike propagandists at the White House, Main Street believes Wall Street will take care of itself, with or without the bailout.<span style="mso-spacerun: yes">&nbsp; </span>They fear the money falling into the wrong hands like it did in Iraq when 360 metric tons of $100-bills went missing.<span style="mso-spacerun: yes">&nbsp; </span>House Republicans and Democrats share the same distrust of turning untold billions over to the White House for safe-keeping.</p> <p class="MsoNormal"> <![if !supportEmptyParas]>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <![endif]>Bush warned that failure to pass his bailout legislation would have a catastrophic effect on retirement savings.<span style="mso-spacerun: yes">&nbsp; </span>That&#39;s ironic from the No. 1 advocate for private Social Security investment accounts.<span style="mso-spacerun: yes">&nbsp; </span>Mutual fund retirement or investment accounts go up or down with the market.<span style="mso-spacerun: yes">&nbsp; </span>Most financial planners urge investors to take a long-term investment strategy.<span style="mso-spacerun: yes">&nbsp;&nbsp; </span>Warren Buffet, one of the nation s most successful investors, frequently advocates a 25-year investment horizon.<span style="mso-spacerun: yes">&nbsp; </span> The first thing I would do is say,  Let s not call it a bailout.<span style="mso-spacerun: yes">&nbsp; </span>Let s call it a rescue,  said GOP presidential nominee Sen. John McCain (R-Ariz.), urging Congress to pass the $700 billion plan.<span style="mso-spacerun: yes">&nbsp; </span>For the  Straight Talk Express, McCain has no problem mincing words.<span style="mso-spacerun: yes">&nbsp; </span>If it looks like a duck, walks like a duck and quacks like a duck, then it s a  bailout plan.<span style="mso-spacerun: yes">&nbsp; </span>No amount of spin can say otherwise.</p> <p class="MsoNormal"> <![if !supportEmptyParas]>&nbsp;<![endif]><span style="mso-tab-count:1">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </span>Wall Street s bailout out plan will probably pass sometime this week.<span style="mso-spacerun: yes">&nbsp; </span>Whether it s good for the country or not is anyone s guess.<span style="mso-spacerun: yes">&nbsp; </span>Because it runs against every sound economic principle, it probably will do more harm than good.<span style="mso-spacerun: yes">&nbsp; </span>During an election year, there s no stomach for riding out more bad economic news, especially for McCain, whose standing in the polls has gone into a freefall.<span style="mso-spacerun: yes">&nbsp; </span>While there s many factors at play, the deteriorating economy has given Barack new life, now leading by around 5% in aggregate polling.<span style="mso-spacerun: yes">&nbsp; </span>Wall Street would probably benefit in the long run adding another trillion to the national debt.<span style="mso-spacerun: yes">&nbsp; </span>Blocking the legislation hurts McCain only one month before Election Day.<span style="mso-spacerun: yes">&nbsp; </span>As the Nov. 4 nears, voters have become more anxious about McCain s propensity to lower taxes, cut government spending and plan for more war.<span style="mso-spacerun: yes">&nbsp; </span>Bailout or not, the economy will go on.</p> <p><b><u>About the Author</u></b><br> </p> <p><b>John M. Curtis </b>writes politically neutral commentary analyzing spin in national and global news. He&#x2019;s editor of OnlineColumnist.com and author of <a href="books.html">Dodging The Bullet</a> and <a href="books.html">Operation Charisma</a>.<br> </p> <p></p> </td> <td width="1" height="2576" rowspan="2">&nbsp;</td> <td width="1" height="2"><spacer type="block" width="1" height="2"></td> </tr> <tr height="2574"> <td width="133" height="2574" valign="top" align="left" xpos="0"><img height="172" width="111" src="images/johninframe3.jpg"></td> <td width="1" height="2574"><spacer type="block" width="1" height="2574"></td> </tr> <tr height="1" cntrlrow> <td width="133" height="1"><spacer type="block" width="133" height="1"></td> <td width="7" height="1"><spacer type="block" width="7" height="1"></td> <td width="182" height="1"><spacer type="block" width="182" height="1"></td> <td width="300" height="1"><spacer type="block" width="300" height="1"></td> <td width="1" height="1"><spacer type="block" width="1" height="1"></td> <td width="1" height="1"></td> </tr> </table> <table border="0" cellpadding="0" cellspacing="2" width="597"> <tr> <td><font size="1" face="Arial,Geneva,Helvetica"> <hr noshade size="1"> </font><a href="index.html"><font face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular" size="2"><strong>Home</strong></font></a><font face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular" size="2"><strong> || <a href="articlesindex.html">Articles</a> || <a href="books.html">Books</a> || <a href="teflon.html">The Teflon Report</a> || <a href="mailto:letters@onlinecolumnist.com">Reactions</a> || <a href="aboutdiscobolos.html">About Discobolos</a></strong></font> <div align="left"> <p><font size="1" face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular">This site designed, developed and hosted by the experts at</font><font size="2" face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular"> <a href="http://www.cmeonline.net" target="_blank"><img height="30" width="138" src="images/cmelogoANIM.gif" border="0" align="absmiddle"></a></font></p> </div> <p><font size="2" face="Arial,Helvetica,Geneva,Swiss,SunSans-Regular">&copy;1999-2005 <a href="aboutdiscobolos.html">Discobolos Consulting Services, Inc.</a><br> (310) 204-8300<br> All Rights Reserved. </font></td> </tr> </table> </center> </body> </html>