There are victims here – but they are victims of timing and of chance. They might have drunk the kool-aid, but there was a kool-aid station at every single corner, and all their friends and neighbors were drinking the kool-aid too.
Lets look at the REALLY big picture for a sec….
This country is, and has been, going back to a turn of the century economy. There is a large gap between the wealthy and everyone else, the middle class is shrinking and getting squeezed, and the wealthy are getting HUGELY wealthy. We import everything and keep prices low by having huge numbers of workers (china) making a subsistence wage.
This is the same dynamic we are seeing and have seen in the financial markets. The US is a service economy and instead of building anything, we trade financial futures and financial instruments. Up till last month it was billions of billions of dollars being leveraged for / with corporate debt to buy out everything in sight. Mortgages were sold by the millions, without documentation etc. and repackaged to be just another low risk paper, but in reality explosively toxic financial instruments.
Our Republican administration has advanced greed and screw the people to an unprecedented point. No healthcare, low taxes for the wealthy, capital gains of 15%, anything goes in the financial community, approval of mergers which are anti-competitive, whatever the lobbyists want – carte’ blanch. Sorry – no rants against this please… It’s the middle and lower classes which got screwed by this administration, and it will continue for as long as the party of wealth and power keep paying off corrupt officials (on both sides).
From a micro standpoint – there has to be fuel for the Orc’s underground lair to make weapons with and to get rich off of. This is where the homeowners came in. Desperate to buy a house (whether a orange picker in Barstow, to a doctor’s wife in CV), people do what they have to to get their home. NO ONE is non-emotional and detached when then think of their future, and their living conditions compared to their peers and neighbors. Our government had a hands off policy toward wall street and toward the housing industry. Our politicians get reelected based on the economy (it’s the economy stupid!) and if the price that is paid is lemmings jumping off the edge to feed the financial fires, so be it.
Please… Understand my position. Almost no one can stand under the pressure of timing the market… The market is the market and the hucksters who are making more and more money start going out of control. They lie, misrepresent and then repackage and sell. Will they pay? No. Absolutely not. They will move on to something else and their short term prospects are pretty good – they make out like bandits.
Who pays? We all do. Our government should identify and stop this behavior… But they are the enablers. Where was Greenspan when he dropped interest rates to 0.5%? Why didn’t he report to congress the potential for disaster? Why didn’t congress stop the mortgage market from selling loans to people who were ninjas? This is what Government is supposed to do. Capitalism needs controls, or we have what we had at the beginning of the century – small numbers of people controlling and owning everything, and the regular guy getting screwed.
It is a house of cards…. It’s a house of cards because the dealers have the game rigged.
