No mood

Apart from CNBC (it's not called bubble vision for nothing), it's stock centric viewers, and Chuck Schumer of course, m* has been getting a definite impression that the tone out there is increasingly in favor of a bit more suffering for the markets focused crowd. Recent comments from Fed governors, economists, and assorted letters to the editor type are very much on the side of letting the markets reap what was sown at this point.

This matters to m* only insofar as it contributes to handicapping the outcome of next week's Fed meeting. It is possible that the room the Fed desperately wants to move in a way that is not seen as caving in to pressure from stock touts and innumerate congressmen may be opening, just.

m* is quite certain that for all the high-powered research and great minds at work supporting the edifice we call central banking, what we have right now resembles nothing so much as a poker game at this point, with continued confidence in the Fed as the arbiter of the nation's economic health and the health of the USD at stake.

Then again, the prior Fed had a lot to do with setting the stage for where we are now, such that there may be nothing much the current one can do about it except try to manage the decline. m* is in this camp and while a muddle through is a possibility, the risks are most surely to the downside, that the current slow erosion picks up speed with. In that vein, gold and yen are still performing.

The always educational Calculated Risk site has a thorough tutorial on mortgage "origination" and it's myriad tentacles, suckers, and gaping maws. Needless to say, cheap capital (thanks Al), and greed make for a very corrupting cocktail - that should come as no surprise, but the perverse collective of moving parts that quickly evolved to enable the entirety of the enterprise may both enlighten and shock those still clinging to the "safe as houses" illusion.

Additional food for thought, highlighted on Economists' View, is a report of a new study on emotion in politics. The understanding that voters are frequently making emotion based choices as opposed to "rational" ones (from an economist's standpoint anyway) is now making waves. Todays item says there is evidence for brain based differences in outlook between voters described as conservative or liberal. It is an easy leap to explain red versus blue and mid-section versus coasts. Born or bred is what m* wants to know.