Originally Posted by popcorn_karate
I think Fernholtz jumped on Carney because he thought Carney was trying to set-up the situation as a case of some sort of political corruption with ties to the whitehouse etc. This was another example of fernholtz being a bit of an idiot because he was listening to what he expected to hear rather than what was being said. I really don't think that was Carney's point.
I think Carney was pointing out that even with everything that has been done since the financial collapse, investors are still counting on political connections to be well worth paying a little extra for - and the principal clause in the contract was evidence for that. I imagine Carney was a bit shocked at Fernholtz's reaction considering that he would be expected to agree with Carny's assessment - namely that the big money people have not seen anything to make them fear that they could be the subjects of market forces like the peons are.
the collapse of MF-ing global could be the first sign of things changing, we'll have to see how it shakes out. on the other hand, it is small enough that it may not be much of a data point.
I guess one way to figure out what Carney's point is would be to just click on the first of the two links
to this diavlog. It's a bit long but it seems to come down to this speculative thought:
"investors and creditors might expect that MF Global would have inside information. Is the White House going to help bail out Italy? Corzine would know better than most. Where are green subsidies heading? Corzine's deputy Abelow has the inside track."