Fear mongers

1929 revisited: déjà vu all over again?

First, President Bush warned that if Congress didn’t pass the bail-out, we would enter a depression equivalent to 1929. Now, Germany's Interior Minister Wolfgang Schaeuble gave a warning that the financial crisis could be as bad as that one that lead to Adolf Hitler rising to power and the subsequent consequences.

Unfortunately the politicians are leading the fear parade. So far, the tactic has worked, but will the bail-out actually help? We needed a market correction, and got one. It will take time to sort things out. However, the real solutions are much harder politically than what the pols have come up with so far. We got here partly as a result of a lack of oversight. For stability to return to the markets, investors and lenders need to feel comfortable about values. Manipulation of them doesn't help. We need to take that factor out.