Headline of the Day: Recession-Plagued Nation Demands New Bubble To Invest In

Fortunately, its from the Onion — but it sounds way too real!

Recession-Plagued Nation Demands New Bubble To Invest In  

A panel of top business leaders testified before Congress about the worsening
recession Monday, demanding the government provide Americans with a new
irresponsible and largely illusory economic bubble in which to invest.

Bubblechartcnightmare"What America needs right now is not more talk and long-term strategy, but a
concrete way to create more imaginary wealth in the very immediate future," said
Thomas Jenkins, CFO of the Boston-area Jenkins Financial Group, a bubble-based
investment firm. "We are in a crisis, and that crisis demands an unviable
short-term solution."

The current economic woes, brought on by the collapse of the so-called
"housing bubble," are considered the worst to hit investors since the equally
untenable dot-com bubble burst in 2001. According to investment experts, now
that the option of making millions of dollars in a short time with imaginary
profits from bad real-estate deals has disappeared, the need for another
spontaneous make-believe source of wealth has never been more urgent.

If it wasn’t so sad, it would be hysterical . . .


Recession-Plagued Nation Demands New Bubble To Invest In
July 14, 2008 | Issue 44•29

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What's been said:

Discussions found on the web:
  1. roger commented on Jul 14

    The best comedy always hurts.

  2. Greg commented on Jul 14

    My new favorite onion article. It was ‘NASA get’s WiFi’ from last year.

  3. johnnyvee commented on Jul 14

    I think that the bottom is nearing, i.e., the bottom is about to free fall.

  4. Francois commented on Jul 14


    Satire is the way to tell an ugly truth while laughing at it.

    It is still an ugly truth tough. :-(

  5. Jay commented on Jul 14

    Looks like the VIX on your RSS subscribers is at 29…

  6. Chief Tomahawk commented on Jul 14

    BR, Eric Janzen of http://www.ITulip.com has already called for a massive buildout & up for alternative energy. Given the weak dollar, why not?

  7. mattbg commented on Jul 14

    Funny that they missed the bubble that is genuinely trying to be inflated at the moment: the green/environmental bubble.

  8. austincompany commented on Jul 14

    Best bet for a new bubble?

    Why “Carbon Offsets” of course! What better way to show the ignorance and stupidity of man…

  9. JL commented on Jul 14

    “…Jenkins Financial Group, a bubble-based investment firm.”

    Classic. Describes 99% of investment firms out there.

  10. Tejvan Pettinger commented on Jul 14

    Maybe the next bubble will be pawnbrokers?

    “At this point, bubbles are the only thing keeping us afloat.” :)

  11. gina commented on Jul 14

    Look Look There is a light at the end of the tunnel,,,But it is a freight train loaded with high explosives on a short fuze

  12. DL commented on Jul 14

    I haven’t seen Brian Wesbury make an appearance on CNBC in a while.

    I want to hear about how there’s no recession on the horizon.

  13. Sinomania! commented on Jul 14

    What Chief Tomahawk said:

    That Eric Janzen article is brilliant and eerily real with the Pickens Plan, etc., etc.

  14. Andy Tabbo commented on Jul 14

    Brilliant. Satire is an excellent way to reveal the truth:

    “According to investment experts, now that the option of making millions of dollars in a short time with imaginary profits from bad real-estate deals has disappeared, the need for another spontaneous make-believe source of wealth has never been more urgent.”

    I rarely trade individual stocks. I’m strictly a futures traders who employs 100% technical analysis. The reason is I’d rather buy/sell an index and not individual stocks is TRUST. I simply cannot trust an investment in a companies ‘stock.’ Let’s face, all of these publicly traded companies once began as private concerns. The number one reason to go public is for owners to create a means to “cash out.” Do you really want to buy stock when the original owners are selling?

    They often use the excuse of “wanting to raise permanent capital to fund ‘growth.'” But let’s be honest. There are huge debt markets out there that could be tapped if they were upbeat on their growth prospects. I know. I know. Raising capital from shareholders via IPO is ‘interest free cash.’ But, it’s also true that if you really believed in the growth prospects of your business, you would never sell.

    Of course, there’s plenty of great businesses that have grown up in the public markets. And some have created vast wealth. But, there sure are a lot of losers.

    – AT

  15. Movie Guy commented on Jul 14

    What in do you think is happening in the commodities market?!

    That’s where the game moved.

  16. Douglas Watts commented on Jul 14

    They forgot my favorite … zinc oxide.

  17. mattbg commented on Jul 14

    They also forgot: “dehydrated water”.

  18. Paul in NYC commented on Jul 14

    Clearly we need to be investing in bubbles.
    Bubbles are the way to go. Big soapy, floating ones will do best.

  19. Upstream commented on Jul 14

    how the illegals futures would work?

    – nationality?
    – point of entry?
    – method of entry?
    – terrorism potential?

  20. Jim Haygood commented on Jul 14

    Two-thirds of Congress, and three-fourths of the Federal Reserve Board, will take the Onion article at face value.

    Me, I’m buying tungsten cowhide futures and miners of crapalloy.

  21. Vermont Trader commented on Jul 14

    Don’t forget my favorite. Budweiser 5 cent certificates of deposit. Now a global play!

  22. Uncle Jeffy commented on Jul 14

    The heck with all that other stuff – I’m long rope, because when we string all the crooks out there up by their necks and leave them to twist slowly, slowly in the wind (ah, where is John Mitchell when we really need him!), I figure that’s gotta lead to a huge increase in sales.

  23. BG commented on Jul 14

    Day after day, week after week…this thing continues to play out like a slow motion train wreck.

    The longer this goes on, the scarier it becomes.

  24. MarkTX commented on Jul 14

    Its interesting that no one stops to think
    that US Treasuries may be in the Biggest Bubble of them all…

  25. MarkTX commented on Jul 14

    Its interesting that no one stops to think
    that US Treasuries may be in the Biggest Bubble of them all…

  26. Martin commented on Jul 14

    I’m voting for transparent aluminum.

  27. Mary commented on Jul 14

    Keep tagging me “spam” because your automated filter picks off “inc” + “com”. Or maybe you just don’t care for institutional reality checks.

    The next bubbles are carbon credit accreditors (IT/FIN models) and health information technology (HIT) so-called independent software vendors (ISVs). That’s where VC and private equity will shop returns. Bush began promoting HIT-ISVs in 2004 and regional EHR datamarts (RHIOs) which feed NIH/CDC clinical funding.

    You may have missed the 18-month David Brailer road show.

    Just like pentagon R&D, just like mortgages, just like “faith-based” distributors, just like civilian corp.

  28. zell commented on Jul 14

    MarkTx wins!

  29. Sufferin’ Succotash commented on Jul 14

    Other bubble possibilities:

    For supplying the town of Deal with fresh water.
    For trading in hair.
    For assuring of seamen’s wages.
    For importing pitch and tar, and other naval stores, from North Britain and America.
    For insuring of horses.
    For improving the art of making soap.
    For improving of gardens.
    For insuring and increasing children’s fortunes.
    For a wheel for perpetual motion.
    For importing walnut-trees from Virginia.
    For making of rape-oil.
    For paying pensions to widows and others, at a small discount.
    For making iron with pit coal.
    For the transmutation of quicksilver into a malleable fine metal.

    OBGs, from 1720.
    The year of the Mother Of All Bubbles.

  30. Ken H. commented on Jul 14

    C’mon Barry,

    I asked you this a few months ago? Tell us already!

    I think frugal and shrewd is in! Big Picture carbon credits sounds good too, LOL!

    Easy money is F’ing gone folks! Get over it and I hope you have an actual skill!

  31. roger commented on Jul 14

    Interesting that the economics profession, which in the nineties was reluctant even to admit there was such a thing as a bubble, cannot admit today that their screwy messing with U.S. accounting procedures, like for inflation and unemployment, were among the factors causing the housing bubble. If housing had been properly factored into the inflation statistics, the Fed would have had to raise rates to cool off the bubble in 2005 – as inflation would have measured about 3 percentage points more than it did. But no. Instead, with that combo of hedonics and gimcrackery, the Fed registered just the right inflation rate to do what it wanted to do. Which of coursed sent down the value of the dollar and produced the inflationary conditions for oil.

    Of course, the housing bubble was a perfect test of hedonics. If magic hedonic dollars were produced when houses were “made better”, than the consumers were, in effect, getting cheaper houses – and a cheaper good will sell to a larger demand. So it happened that housing ownership leaped. But a funny thing happened on the way to paradise – it turned out those owners couldn’t turn their hedonic dollars into real ones to pay the mortgage.

    Now, that is what you need for a bubble. You need firstly a metric that fundamentally misstates it, agreed to by all the “mainstream” economists. This leads to a regulatory structure that either fails to regulate it properly or at all, since it is operating with magic figures, which then leads to an incentive structure where the profit is all in creaming off transaction fees.

  32. Sara R commented on Jul 14

    Did you keep reading to the bottom?

    “The most support thus far has gone toward the so-called paper bubble. In this appealing scenario, various privately issued pieces of paper, backed by government tax incentives but entirely worthless, would temporarily be given grossly inflated artificial values and sold to unsuspecting stockholders by greedy and unscrupulous entrepreneurs.

    “Little pieces of paper are the next big thing,” speculator Joanna Nadir, of Falls Church, VA said. “Just keep telling yourself that. If enough people can be talked into thinking it’s legitimate, it will become temporarily true.”


  33. me commented on Jul 14

    Ask a good reference librarian to find this for you (it’s now blocked so the Internet Archive can’t display the full article, sigh, it’s dynamite).

    The rhetoric and reality of American dream: Securities legislation and the accounting profession in …
    B Merino, A Mayper – 1999 – Working paper, University of North Texas

    Securities legislation and the accounting profession in the 1930s: The rhetoric and reality of the American Dream. Authors: Merino B.D.; Mayper A.G. …

    “… symbolic legislation might be sufficient to restore investor confidence. We use as our framework the pragmatic concept of democratic conversation, unique to the United States, to frame the ideological debate. We posit that securities legislation can best be understood as an effort to reestablish the viability of what has been labeled the “American dream”. We concur with the conclusion of Wettergreen (“The Regulatory Policy of the New Deal”, The New Deal, 1989, pp. 199–213) that passage of the securities legislation must be examined as a response to a moral crisis of capitalism, generated by the “immoral behavior” of the capitalist elite…. the first priority of any regulation had to be to establish the moral legitimacy of capitalism by restoring trust in the existing system….”

  34. Dave commented on Jul 14

    Here is a possible Onion article

    “The bonds of Ambac and MBIA will be guaranteed by the George Washington Bridge”.

    The George Washington Bridge has agreed to lend its AAA rating to guarantee the shaky debt of the two Monoline Insurance Companies. The reliability of the constant stream of income from tolls will backstop the two insurance companies whose balance sheet is plagued by unfathomable and esoteric derivatives which are certain result in considerable loss. The contracts issued by the bridge will pay off in case either company fails and in this way investors can invest in these great companies without fear of default risk.

  35. Ella commented on Jul 14

    This is a joke. Right? April fools…

  36. OIL150 commented on Jul 14

    Equity markets have recently lost over $2 trillion in the U.S. and even more globally — many times the likely amount of mortgage and corporate debt losses in the foreseeable future. This is in part a correction from the sharp global equity run-up through mid-July. Current prices still signal growth ahead

    Will the dow Retest 5,000?

    large caps into small and mid, it has longer-term bullish implications and doesn’t bode very well for the masses who seem to be looking for 1300 on the S&P.

    I noticed even the bullish Carl Fu

  37. estaban commented on Jul 14

    Here is a bubble I dont understand. I cant walk three blocks in Manhattan without encountering some sort of construction. Even desolate spots of Brooklyn’s Park Slope are being built up. Is the finance industry going to give New York so many new jobs that there will be renters or buyers? So how do builders finance these projects? Is it done like housing? i.e. securitized loans? Confused!

  38. Risk Averse Alert commented on Jul 15

    There’s tons of real-estate on the moon and Mars. Let’s colonize it, ruthless exploit the resources and destroy its fragile eco-structure like a bunch of greed-filled human beings who just want to live a decent life in our short time … restoring ourselves to the optimistic vision that brings man to accomplishing something profoundly good and powerful, rather than sitting back while being made to believe a bunch of cave dwelling, dog gassing, monkey bar climbing fleas can bring the greatest republic the world has ever seen to its knees.

  39. poopscooperforlife commented on Jul 15

    ” It must surely be a mistake to adopt an economic policy which makes you rich if you eliminate your national work force and transfer your production abroad, and which bankrupts you if you continue to employ your own people. ”

    ” It is extraordinary to read economists commenting on the state of the nation. They believe that the profitability of large corporations and the level of the stock markets are the reliable guide in assessing the health of the society and the economy. A healthy economy does not exclude from active life a substantial proportion of its citizens. ”

    – James Goldsmith 1993

  40. Dr. Kenneth Noisewater commented on Jul 15

    “Little pieces of paper are the next big thing,” speculator Joanna Nadir, of Falls Church, VA said. “Just keep telling yourself that. If enough people can be talked into thinking it’s legitimate, it will become temporarily true.”

    “This planet has – or rather had – a problem, which was this: most of the people living on it were unhappy for pretty much of the time. Many solutions were suggested for this problem, but most of these were largely concerned with the movements of small green pieces of paper, which is odd, because on the whole it wasn’t the small green pieces of paper that were unhappy.”

    The next bubble? I vote digital watches. They’re a pretty neat idea.

  41. James S. commented on Jul 15

    The next bubble has already come and is already headed out: ethanol from corn. The number of ethanol plants exploded, has helped drive up world corn prices to the point of pain and already the lack of ethanol demand has caused many of the plants to shut down.

    This bubble has probably gotten less press because Everyman is mostly on the “giving” rather than “receiving” end of its largesse.

  42. prismatic commented on Jul 15

    I couldnt agree more Ken H. But if you dispell the myth of bubbles and calling it by its true name inflation, then how would you deal with the myth of the consumer ? Then you would have to tell the American people that they could only consume what they produce – 50 50. So Im all for bubbles, big beautiful bubbles, and there will always be investors out there willing to put their hard earned money in the next bubble. And I agree untill the next bubble shows, the trasury is the best bubble in town. Just look at all those foreign central banks buying treasury bonds for trillions of dollars. Beautiful!

  43. prismatic commented on Jul 15

    woups ment roger not Ken H.

  44. B Bowles commented on Jul 15

    Forget about the new bubble!! Its just the SOS people.We have created monsters that are going nowhere but to pain & disapointment.Money talks but what is it really saying.

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