Ezra Klein reads Paul Krugman and finds that the financial industry's profits are up. Not just up but really up. Just as we cheer (albeit nervously) when the broader stock market hits and surpasses the 11,000 mark, we'd like to be happy about this.
But as the financial industry stages as comeback, we have to face the fact that they're really just returning to their bad old ways.
In the financial sector, the opacity and complexity of the market keeps other entrants out, and the extremely cheap federal money that these banks now have access to is helping them accelerate their business. But this isn't a good thing. In fact, aside from signaling that the financial sector isn't as competitive as one would hope, it's showing that there are still extraordinary, outsize profits to be made by inventing and selling complex, opaque financial instruments -- which is the same dynamic that got us into this mess.
So yes -- you're being realistic if you're worried. Might want to haul more canned goods and some long novels into the bunker even though you've just finished airing it out from the last siege.
