Dollar is in the dirt We borrow billions from the Chinese Housing market is in the crapper Dow/Nasdaq going down Oil is up and we are spending trillions on our foreign policy I would also like to mention our Veteran community is getting the shaft when it comes to benefits because of lack of money. Is anyone else a bit concerned?
There is no shortage of bologna on this board. :lol: But seriously, our economy is hurting and most candidates running seem oblivious.
Our economy is hurting mainly because of government interference and tax burdens on Americans are unbearable. To fix our economy government needs to step out and allow Americans to work, earn and flourish. But with plans like the "economic stimulus" by Bush and others along with talk of freezing interest rates will be a quick "fix" and further disaster in the long run. http://www.townhall.com/columnists/WalterEWilliams/2008/01/23/subprime_bailout
It doesn't always work that way. The current recession and economic crisis was caused by private sector capitalism itself, unfettered by government regulation. The housing bust and the sub-prime mortgage was a result of greed and poor judgement on the part of lenders in the finance industry. As a result, the entire economy of the country is hurting. For the best interests of the nation, it is sometimes necessary to regulate an industry.
To discuss economics properly we have to understand we are not in a recession. We have not had even 1 month of negative growth, much less 2 quarters. We are experiencing a slowing economy. The sub-prime mess is playing a small role, but even Bernanke said it is pretty self contained. What is hurting the GDP more than anything is our growing reliance on debt at both the national and personal level. Save the economy. Only buy things you can pay for.
This i actually agree with, predatory lending practices is one of the main reasons for the recession. Given someone a loan for a house, with no income verification and no way to asses the risk of the person paying it back. The impact of this nationally resulted in 13 billion dollar write downs by BOA and other longstanding financial institutions. The market help create the mess as well they way they packaged this kind of debt as securities offerings on the market. What investor in his right mind would invest in such a risk. Also, many of you dont want to hear this but the financial restrain of the war has put us in this situation as well. There was a study a few weeks back that said the war cost each american like 22,000 dollars, However, Bush only wants to band aid this with a 800 or 1600 per person stimulus package. Most of the people who get this money wont put it back in the economy if they are responsible. This wont stimulate the economy, must working folks will save or pay bills with this money. you have to let this thing run its course. you cant cut the rate to 1% but its still a reward/risk factor, the people who are borrowing the money, the banks will only give it to them if their credit is good enough to borrow. The people in the foreclosure mess wont benefit from refinancing, because if thats the case they would have already re financed at the low rate we have now. The point is they dont have the credit to refinance.
It is interesting to see people not blame the consumers for this subprime mess. I'm curious, what percentage of these loans were predatory? No doubt predatory lending goes on, but no one forced consumers into many of these bad deals. Sadly, most consumers are uninformed about money matters and no amount of regulation will save them. Unless, you want the government to decide what loan products can be offered and who qualifies for them. You know what they say ... if it sounds too good to be true, it probably is. But american consumers are every bit as greedy as american businesses. Greed, the american way!
I was just about to write this same thing. 98% of the people affected by the sub-prime loan mess knew what they were doing when they took out those ARM loans. They bought too much house and could not afford it but thought that even if they couldn't afford it, home prices would continue to go up so they were covered. But only about 2% of home mortgages are in foreclosure so to blame this "recession" as MSNBC calls it, on the subprime deal is stupid and false.
98% is way to far to go and to actually prove, so I would back off on the percentages, but you dont seem like the type of person who would. Just my opinion. You say its the consumers fault, however, with no oversight as I said before, when you package high risk securities and trade them within the market, it makes the impact that much greater, than just writing down debt from bad mortgages. They are writing down debt from secured bad debt packages from predatory lending. Yes consumers need to be educated and they are definitely partley to blame. but its much more invovled in this, earlier you alluded to high oil prices, thats a direct result of this bogus energy bill thats in place.
