Mort Zuckerman pays his respects to John McLaughlin

Here.

Mort puts his time on The McLaughlin Group at about 24 of the 34 years, but has been notably absent in the last year and otherwise has been more quiet than usual.

The last time I remember him writing much of anything was early in 2013 when he reiterated that America was in actuality experiencing another economic depression.

This Is A Depression, Says Dem. Billionaire Mort Zuckerman

"We believe we live in more normal times—and we do not. Millions of people today are experiencing exactly the same struggle as the millions did in the Great Depression. They can't find work. They depend on government and philanthropy. They live on hope denied. ...

"The reality is, we are experiencing a modern-day Depression. It is harder to find work than it has been in any previous economic recovery period. ...

"The Pew Research Center reports that for the first time in the post-World War II era, middle-class families finished the decade significantly poorer in terms of household net worth—which is down almost 40 percent since 2007—and with lower incomes than a decade earlier. This has hit the middle class harder than any other group. According to Pew, one third of Americans now identify themselves as lower class or lower middle class, a deterioration since 2008 when one quarter identified themselves that way. ...

"We are living through a breakdown of the great American jobs machine. This is not a recovery. Annual GDP growth in 2010 and 2011 averaged a mere 2.4 percent; in 2012, GDP growth slowed to 1.8 percent. In other words, cumulative growth for the last 11 quarters was just 6.8 percent, less than half the 15.2 percent average growth in GDP after previous recessions over a similar period of time. This is the slowest growth rate following all 11 post-World War II recessions. ...

"No recession since the end of World War II has been as deep or as long as this one, severely testing the optimism, confidence, and animal spirits that typify the temper of America. The question of the hour is how can we find a way to avoid becoming a low-wage, part-time country."

Read the full story, "How We Can End Our Modern-Day Depression," from Mort Zuckerman, here. 

Obama's Laser-Like Focus Vaporizes Full-Time Jobs

Get mort-ified, here.

Zuckerman is Mortified: It May Be A Depression

He takes a long look at the depth of the unemployment problem, here, and concludes with this:

Gluskin Sheff's Rosenberg captured it perfectly: We may well be in the midst of a "modern depression."

Congressional Mandates Overheated Housing, Not Wall Street

Mort Zuckerman writes a helpful essay explaining the complex world of mortgage finance and the role of derivatives, and lays much of the blame for the crisis we are going through squarely where it belongs, on the Congress of the United States, instead of on Wall Street:

But we also need to understand how the housing market got as hot as it did. Why did it keep rising, generating more and more derivatives geared to a rising market? It turns out that Fannie Mae, Freddie Mac, and the Federal Housing Administration had financed a lot more subprime and Alt-A (alternative documentation) loans than anyone realized, mostly as a result of congressional mandates. Indeed, of their total outstanding mortgage portfolios of $10.6 trillion, roughly half turned out to be of low quality. Had this been known, it would have been clear that the American public's capacity to assume this amount of housing debt was at great risk.

That is at the heart of the now-famous Goldman-Paulson saga. Hedge fund manager John Paulson judged that the housing market was a bubble, so he shorted the securities through Goldman Sachs and an insurer called ACA, which sold the package to a German bank. The buyers judged that it was safe to count on housing prices continuing to rise. They chose which mortgage securities would be bundled by Goldman. And they have paid a heavy price for their judgment.

The American public has hereby had a peek into the bewildering complexities of the world of finance. The natural instinct is for the public to blame the housing decline on those who shorted. But it is the other way around. They should be blaming those who let the market get pumped up, inviting a dramatic and painful correction that took most people by surprise.

The complete story is well worth reading, here.