Comments on: FRONTLINE: Inside the Meltdown of Sept. 18, 2008 http://www.creditwritedowns.com/2009/02/frontline-inside-the-meltdown-of-sept-18-2008.html Finance, Economics and Markets Fri, 10 Feb 2012 00:37:00 +0000 hourly 1 By: Edward Harrison http://www.creditwritedowns.com/2009/02/frontline-inside-the-meltdown-of-sept-18-2008.html#comment-4003 Edward Harrison Thu, 19 Feb 2009 22:49:49 +0000 http://www.creditwritedowns.com/?p=6155#comment-4003 Tony, you say "In short, Frontline did a good job of covering the crises from March 2008 to October 2008, but that is only part of the story." I would agree with that 100%. In fact, you can see my timeline of events through January here: http://www.creditwritedowns.com/credit-crisis-timeline As far as the public consciousness goes, they really only see what happened during the most acute phases. Tony, you say “In short, Frontline did a good job of covering the crises from March 2008 to October 2008, but that is only part of the story.”

I would agree with that 100%. In fact, you can see my timeline of events through January here:

http://www.creditwritedowns.com/credit-crisis-timeline

As far as the public consciousness goes, they really only see what happened during the most acute phases.

]]> By: Tony Wikrent http://www.creditwritedowns.com/2009/02/frontline-inside-the-meltdown-of-sept-18-2008.html#comment-3991 Tony Wikrent Thu, 19 Feb 2009 04:46:03 +0000 http://www.creditwritedowns.com/?p=6155#comment-3991 I was rather disappointed with the Frontline presentation "Inside the Meltdown" because the first real problems began to appear in the spring of 2007, and by summer 2007 it was clear that there was a systemic series of crises beginning to snow ball (see Jerome a Paris's diary of last week, When did the financial crisis really start?, http://www.dailykos.com/story/2009/2/12/125228/516). And the Frontline program mentioned credit default swaps, but did not do enough to expose them as the high-risk speculative instruments they became, as Michael Lewis did in his Portfolio article a few months ago: CDSs were being written for contracts that did not exist. The CDSs are what blew up AIG - and I've seen a few credible assertions in some financial articles the past few weeks that at least around $80 billion of the money being spent by the Fed and the Treasury is going to pay off the bets of CDS buyers of the London unit of AIG. The Frontline program also should have gone more into the "shadow banking system": the role of the hedge funds and sovereign wealth funds, which I suspect may be much of the reason the rescue has evolved the way it has, most particularly the unwillingness to cram down shareholders and bond holders (anyone want to call the Saudis and the Chinese to tell them they have to eat a few hundred billion in losses?). And someone has to explore the role of the offshore financial centers, which from what I've seen so far, only the London Guardian is willing to do. In short, Frontline did a good job of covering the crises from March 2008 to October 2008, but that is only part of the story. What I found interesting was a question never raised: if Paulson could be so tough in forcing Bare Sterns to be sold at two dollars a share to JP Morgan, and so tough in letting Lehman Brothers fail, why was he such a push over for allowing Wall Streeters getting TARP to take bonuses and other perks? Finally, the big item missing from Frontline, and from almost all discussions right now, is the underlying problem being the impoverishment of the working class over the past three decades. Again, see Jerome a Paris's diary of last week, and the past few years. And here's something I wrote in December 2007: Not Good – We’ve Been Here Before http://www.dailykos.com/story/2007/12/2/171754/514 I was rather disappointed with the Frontline presentation “Inside the Meltdown” because the first real problems began to appear in the spring of 2007, and by summer 2007 it was clear that there was a systemic series of crises beginning to snow ball (see Jerome a Paris’s diary of last week, When did the financial crisis really start?, http://www.dailykos.com/story/2009/2/12/125228/516). And the Frontline program mentioned credit default swaps, but did not do enough to expose them as the high-risk speculative instruments they became, as Michael Lewis did in his Portfolio article a few months ago: CDSs were being written for contracts that did not exist. The CDSs are what blew up AIG – and I’ve seen a few credible assertions in some financial articles the past few weeks that at least around $80 billion of the money being spent by the Fed and the Treasury is going to pay off the bets of CDS buyers of the London unit of AIG.

The Frontline program also should have gone more into the “shadow banking system”: the role of the hedge funds and sovereign wealth funds, which I suspect may be much of the reason the rescue has evolved the way it has, most particularly the unwillingness to cram down shareholders and bond holders (anyone want to call the Saudis and the Chinese to tell them they have to eat a few hundred billion in losses?). And someone has to explore the role of the offshore financial centers, which from what I’ve seen so far, only the London Guardian is willing to do.

In short, Frontline did a good job of covering the crises from March 2008 to October 2008, but that is only part of the story.

What I found interesting was a question never raised: if Paulson could be so tough in forcing Bare Sterns to be sold at two dollars a share to JP Morgan, and so tough in letting Lehman Brothers fail, why was he such a push over for allowing Wall Streeters getting TARP to take bonuses and other perks?

Finally, the big item missing from Frontline, and from almost all discussions right now, is the underlying problem being the impoverishment of the working class over the past three decades. Again, see Jerome a Paris’s diary of last week, and the past few years. And here’s something I wrote in December 2007: Not Good – We’ve Been Here Before
http://www.dailykos.com/story/2007/12/2/171754/514

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