everyone knows nothing at all

IOZ, when not warbling about the transcendence of abstention, tells the story of Big Shitpile in a way we, the newly (or oldly) cynical, can understand:

Consider Bear Stearns, who was once as handsome and tall as . . . Well, consider anyway this throwaway line and quite common sentiment these days:

“The problem is bigger than the Fed,” said Meredith A. Whitney, an Oppenheimer financial services analyst. "Trillions of dollars of securities were underwritten on the false assumption house prices could never go down on a national basis. That falsehood has put the entire financial system in a tailspin."

Right. And we all believed that Saddam Hussein had weapons of mass destruction, and he kicked out the inspectors, and oil would pay for the war, and there will be no permanent military bases. Ladies and gents, boobs and rubes, the falsehood Ms. Whitney--and plenty of others--identifies is a fine tall tale for house-flippers and the jerks who think they're going to hit it Buffet style on eTrade, but the people who run all those "financial services" know that there's no such thing as economic escape velocity. That which goes up must come down. Anyone who knew anything, admittedly a vanishing category these days, knew not only that housing prices could go down on a national basis, but banked on the fact that they would. The run-up was all smoke, mirrors and profit-taking, and the downturn, even in these early stages, will be all about the massive transference of wealth from the public coffers into the so-called private sector.