Good Advice for John McCain, and More:

Jennifer Rubin has some. I suspect that no matter how good a campaign McCain runs from now on, he's doomed unless the economic news suddenly takes a turn for the better.

Speaking of which, I have to give some credit to the powers-that-be. I remember in 1988, knowledgeable observers, but not the general public, were aware that the Savings and Loan crisis loomed, but no major figures in either party would talk about it, for fear of the political consequences. At least at the time, pundits suggested that putting off dealing with the crisis cost the nation tens of billions of dollars.

I don't know if it was even possible for Paulson et al. to try to cover up or paper over the extent of the crisis until after the elections, but, if it was, they certainly didn't try to do so. I'm not confident that the solutions at hand will work, at least without causing an inflationary backlash, but surely better to start dealing with the situation now than in January.

Finally, is there something fundamentally wrong with our banking system? Or is there something fundamentally wrong with the way we regulate (or don't regulate) financial institutions? Or perhaps the world's central banks are a lot less able to figure out how to manage the money supply than we think, sending false signals resulting in bubbles that in turn result in crashes? Or all three?

It seems that even in the U.S., we can't go more than a few years without a banking crisis of some type or other. Just within my memory, we had the crisis during the Reagan Administration of banks that made bad loans to bankrupt Third World countries, the S&L crisis, the threat of a financial system meltdown in 1998, and now the mother of all banking crises. And there have been other banking crises in other nations periodically as well, even in Japan, a country known for its conservatism (in a nonpolitical sense).