I'd comment more on the economic mess if I understood it better. Like John McCain, I have no expertise on economic matters (though I did get an "A" in Econ 101 in college, so I may be one up on him there. Hey, how come I'm not his running mate? Oh, I have a penis. Never mind).
Anyway, have at it -- let's start an open thread. What do you think about what's happening on Wall Street and Capitol Hill's response?
3 comments:
I view the disaster on Wall St. to be worse than that of the recent hurricaines. True, there's no physical devistation, but at least with respect to the hurricaine disasters, I can see my tax dollars put to good use in helping those affected by it. On Wall St., it's becoming more and more apparent that despite dicey investment strategies, poor decision making, and questionable ethics, the government (with your tax dollars) will bail out just about anyone.
Who's this really helping? Certainly not me - my retirement fund is still taking a nosedive from all this instability. I see it more to be helping the privilaged few that run these conglomerates. They're being given money we don't have with not much more than a slap on the hand and a "try to do better next time" retort.
Yes, I believe everyone deserves a chance to succeed. Yes, I believe everyone deserves a roof over their head. But did they really think that just because someone purchased a house, they'd all of a sudden become responsible, budget-minding individuals? And even if they did become such an individual, the sham of sub-prime lending is something I'm sure most people (including myself) can barely understand; I can barely understand my OWN mortgage. I'm sure many people were simply drawn in by the fact that they could own their own home without really understanding the true ramifications of what they were signing onto.
So, when the inevitable reality finally reared its ugly head, all these companies had to do was cry "help!" and in rushes in the knight in shining armor (aka the government) to bail them out. And do you or I benefit from it? No. All these tax breaks, tax incentives, government stimulus checks, and mortgage reassignments do not help the regular "Joe" on the street. Either we a) don't make enough money, b) make too much money, c) didn't acquire a risky enough mortgage, or d) paid our mortgages on time to qualify!
But don't worry...if you run a company that makes poor choices, the knight will help you too!
Honestly, I've been waiting for this to happen. We all the deregulation that has been happening since the 90's it was bound to happen. When the tech bubble burst in 2000 I felt that this was going to happen. It was too easy for people to get mortgages and I remember someone telling me long ago, "If it's too easy to get something then something is wrong".
The bigger problem is that the government is bailing out these companies and not adhering to the underlying problems. The credit industry is the next to go belly up.
If the government really wants to help the American people (Obama/McCain should listen to this) then its time for the government to take control and regulate how much credit card companies can charge. And let the American people making less then $100,000 to right off their taxes the interest they have to pay to credit companies. That'll help and when either Presidential candidate raises taxes, and they will raise taxes, then at least there is some relief.
I'm torn. I think it's disgusting that we are bailing out all of these irresponsible companies. It was disgusting that they got into trouble in the first place and that they gave mortgages out to people who never should've had them in the first place. The entire sub-prime mortgage market was a disaster waiting to happen.
So all of the rich sharks who drove the finiancial markets to the brink, plus all of the poor folks given mortgages they never should've had....those people are going to be bailed out by me and my cohorts, the common man. We were responsible....we did things the right way, taking mortgages that we could afford, etc.
That disgusts me....especially as I watch my own retirement portfolio shrinking further and further by the day.
I say I'm torn about the whole bailout thing because what is the alternative? Let the entire financial industry collapse? I don't see that there is a lot of choice at this point.
But I also agree with Scott's original post - I'm no expert on finances, and Simbakahn's statment about barely understanding my own mortgage. If I had been someone who could only get into a house with a sub-prime mortgage....I can't say that I would not have gone down that path. I would like to think I would've been responsible enough to not get into trouble with it, but who knows?
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