Debt and Doubt

This morning on the Rick Santelli show, aka the 7:30 a.m. jobs report on CNBC’s  Squawk Box, Santelli delivered.

First, he delivered the reports. “Jobless claims went from 382,00 last week up to a revised 394,000 so they could say job claims fell to 388,000. Similarly, continuing claims went from 3.72 million to a revised 3.76 million to 3.72 million, down, but essentially unchanged.”

Then Santelli delivered his thoughts on an op ed piece in the Wall St. Journal this morning by Alan S. Blinder called “Handicapping the Economic Recovery.” He hit hard at the Princeton professor for evidently wanting to raise the debt ceiling and not trim the budget.

“This is truly, truly, truly unbelievable that they’re doubling down or nothing. These are smart guys. I call them the dones because they’re double or nothing and they are economists and that means that we are well done. How can they keep doing this? Do you know what happens when you keep doubling to the nth degree? Either you win one, but statistically you may lose, or you just have so much debt … they’re  assuming that there will be these low interest rates forever. My daughter’s in high school and doesn’t even like math, and I think if this is the qualification to teach in the Ivy League, my daughter should be head of the university.”

Squawk Box host Joe Kernen, jumped in,  “I’ve tried this double or nothing with the roulette wheel…”

Santelli began  stamping his feet, saying “And they call this thinking extreme. That’s extreme! I just read about Freddie and Fannie. Both sides, the Republicans, Democrats, independents, is (Blinder) an independent  or a socialist – it doesn’t matter – they’re kicking the can down the road. We have a 3.8 trillion dollar budget and grown men can’t cut 34 to 60 billion dollars. We’re going to be toast if we can’t get these guys to open their eyes.”

Kernen commented,  “There are people who will not acknowledge  any complicity from Freddie and Fannie in the financial crisis.” That prompted another onslaught from Santelli.  “And then you have the likes of AIG we bailed out complaining because we’re not selling them securities back under what they’re worth.”

Kernen remarked that “The Journal says the government created mortgage giants are at the heart of the financial crisis, but now we’re told by people who want to nationalize the whole banking system that it was 100% the banks.”

Santelli: “No, no, they don’t like the banks, they bailed out the banks and the guys who borrowed 43 cents of every dollar are writing regulations for the banking system. You can’t make this stuff up!”

He’s right. You can’t.


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