"…that was a bubble. We knew that couldn't last. Now we're coming back down to earth."
Thus spake Maria Bartiromo last weekend on The McLaughlin Group.
Sorry I'm a few days behind on this. But the worthless public television station serving DR world headquarters — the same one that dumped Louis Rukeyser from Wall Street Week to try to attract a more youthful audience — doesn't carry McLaughlin, so I have to settle for a podcast that's posted several days after the fact. (Worse, it's the version with commercials that airs on a handful of NBC stations).
During a generally inane discussion of the economy comes this exchange:
MR. MCLAUGHLIN: What about foreclosures?
MS. BARTIROMO: Foreclosures are happening, and that's the issue. I am not as worried as some people that the foreclosure situation and the housing slowdown will spill over into the broader economy and cause us a recession. MR. MCLAUGHLIN: What about the credit crunch?
MS. BARTIROMO: The credit crunch is the fundamental underpinnings of the weakness in the market, because credit now is tighter. Companies are not going to be able to do the deals, private (equity ?) are not going to be able to do the deals that they were doing in the preceding year because easy money was all over the place, but that was a bubble. We knew that couldn't last. Now we're coming back down to Earth.
Your humble blogger was nearly smacked by a car on his morning run as he heard this through his headphones, so overwhelmed was he with Mogambo-level rage. When, oh when, did CNBC ever declare all that easy money amounted to a bubble and it couldn't last? OK, maybe Peter Schiff said so during a roundtable or two, but he was usually shouted down per his designated role in those panels as the crackpot uncle furnishing comic relief.
Of course, Bartiromo's use of the royal "we" might not represent her employer. But then who does it represent? And why didn't we hear more from them on CNBC?
Update: The conspiracy-minded lobe of my brain reminded me after posting this that Bartiromo had, at one point, reportedly, allegedly, a "close relationship" with a Citigroup executive… and that perhaps this was the "we" she had in mind, in which case, she committed a major Freudian slip. But nah… If Citigroup knew things were "coming back to earth," it wouldn't face the possibility of financing the TXU deal on its own.