Behind Greenspan's Gloom on the U.S. Economy

With the Lehman bankruptcy today and Merrill Lynch being bought by Bank of America at fire sale prices and GM now asking the government for loans, these are the worst financial times since the Great Depression. Just remember this was brought to us by McCain's chief economics adviser, former Senator Phil Gramm, who wrote the bill repealing the Glass Steagel thereby allowing investment banks like Lehman and Bear Stearns to get into the mortgage business and create new types of mortgage loans like the liar loans, no doc NiNJA ( no income, no job, no assets) loans. Bush et al insisted that new oversight or regulation was not necessary so we are now where we're at. To the Bushies and McCains, regulation is bad.

Wall Street is now left with two brokerages: Goldman and Morgan Stanley (MS, news, msgs)"The majority of investors think that Morgan and Goldman are going to have a tough time surviving without a consumer bank behind them, and unfortunately in this atmosphere, perception is 90% of the reality," MadisonPropTrading's Chris Conefry explained. "It's really impossible to say what will happen to them right now. The two banks that should be rewarded for having the least exposure to this exposure to this debacle -- Goldman and Morgan -- are still being penalized because nobody thinks they can survive this because of their business models. That alone should tell you what the attitude is toward financials in this atmosphere."