credit crunch

The Federal Reserve is considering some aggressive steps to unlock lending, including buying large amounts of unsecured short-term debt, The New York Times says today. That’s the money that companies regularly use to run their everyday operations.
When it seizes up, so does the rest of the economy. And that’s close to what’s happening now.
Now that [...]

One small detail that might have been overlooked as lawmakers failed to pass that $700-billion bailout bill: Today is Sept. 30.
That means it’s the end of the third quarter. And that means – if you want to know what a credit crunch might look like, today could be the day.

I’m guessing Brad DeLong isn’t too happy about today’s failure of the bailout bill. He’s got a suggestion on what to do next: Bring Congress back into session after the election and adopt a nationalized plan.
From DeLong:

Normally when I see the Wall Street Journal flash breaking news like, “the Dow industrials fall more than 600 on fears bailout package vote will fail,” I’d shoot our economics reporter Mary Kane an email to ask her what to make of this. Unfortunately, Mary is out today, so I browsed over to Marketwatch.com [...]

Part 2: The U.S. Treasury has been able to print dollars to service its own debt, but with the rise of the euro and yen, this may change.

As Charles Morris pointed out on our site Thursday, the markets are giddy over a possible Resolution Trust Corp.-like solution to this week’s big meltdown on Wall Street. The only problem, Morris explained, is that the RTC wasn’t actually a bailout and didn’t buy up bad mortgages from ailing banks.
The details don’t seem to matter [...]

If you feel like you’re trying to muddle through absorbing and understanding what happened on Wall Street, and why we are in the mess we’re in, this short video from the Financial Times might help clear things up.
Investment editor John Authers traces many of today’s problems back to the rescue of Long Term Capital Management [...]

As Ari Melber and Matt DeLong have reported on our site, both presidential candidates are keeping up their war of words over Wall Street’s financial crisis and the state of the nation’s economy. You might think that things have changed a lot since last week, when I pointed out that both candidates had been ignoring [...]

In Michigan today, Sen. Joe Biden, the Democratic vice-presidential nominee, seized on Sen. John McCain’s odd claim that the fundamentals of the American economy remain strong.
After Fannie, Freddie, Lehman and a market dive to start the week, few would describe the economy as strong. Biden hit this point to depict McCain as weirdly out of [...]

The payday lenders claim they’ll go out of business if they can no longer charge 400 percent interest on short-term loans.