The Breakdown | Explaining Southern California's economy

Reportings: Solyndra scandal; central banks; Lehman Day

Libertarians attack! Megan McArdle at the Atlantic and my old pal Tim Cavanaugh of Reason focus on the political football that bankrupt California solar startup Solyndra has become. Megan: "Its technology was essentially a large bet that prices of silicon would stay high, making its product competitive." And Tim: "[T]he real outrage is that the government is proudly putting your money into companies that private investors are unwilling to put their own money into. Once this violation of common sense has taken place, the story can only end, as it appears to have ended here, in suffering and crime." (The Atlantic, Reason)

Central banks to the rescue! For now... "The European Central Bank said it will coordinate with the U.S. Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank to offer three-month dollar loans to banks through the end of this year. The move is an effort to prevent Europe's debt crisis from derailing the global economy's rebound from recession." (AP, via the LAT)


It's Lehman Day! On September 15, 2008, Lehman Brothers went bankrupt and…well, you know the rest. Elizabeth Warren is celebrating by running for Senate. The rest of us can relive the nightmare: "When Treasury Secretary Hank Paulson decided to let the firm go under as a lesson in moral hazard, the bank's demise rocked the world and froze global credit markets." (HuffPo)


Photo: Solyndra