Pattern recognition

Good comments on the live Bernanke testimony this morning at calculatedrisk.com:

Comrade Sue: "Remember 'Iraq will pay for itself'?"

Weather Helm: "I'm stunned more people aren't comparing this fear-mongering to the Iracle debacle. Watching this is like watching Colin Powell's address to the United Nations about Saddam's bio-warfare labs."

Here's a tougher one. Imagine what happens when the full moral-hazard phenomenon kicks in, and people start advocating ending this kind of bailout. That's when you will start hearing the arguments we're now hearing for staying in Iraq just a little longer. To wit:

"Sure it was a bad idea and Congress was stampeded into approving it in an election year. But we've created a situation here and we can't just exit just like that. We need to be 'responsible'"... Which in the case of the Wall St bailout will take this form: "This kind of government support has become the norm, and we can't end it too abruptly because it will cause 'the markets' to panic". So it goes.