Paulson as a High-Pressure Telemarketer
By Bryan Caplan
A few years ago, I was tormented by an aggressive broker who kept calling me at 6 AM to sell me stocks. I always hung up on him; but even when I was slamming down the phone, I could still hear him shouting his sales pitch. So I found this eerily amusing:
This technique is one of the last ones in the the Shafiroff book. Once an aggressive retail broker is upside down, the plea goes out for raising more money from the
markclient. “Believe me, I hate being under water more than you. I pulled in some favors, this is the trade that makes it all back for us and then some. I could even get in trouble telling you this, so don’t mention this to your pals. This is the one — but I need you to send in more capital so we can recoup the prior trades that went bad on us.”
I guess Paulson read the book in the early days of his career. That line of bull***t is identical to what the public is now being fed. A series of OpEds in the Washington Post and the Wall Street Journal (and who knows where else) are all pushing the same nonsensical line: The bailout plan is a big money maker…
Financial markets are always complicated. Now they’re more complicated than ever. But the more complicated the world gets, the more you need to use your common-sense skepticism.
In other words, when someone asks you for $700B for reasons he can’t clearly explain, you hang up the phone.