Comments on: Greed and Self Interest Cost US Taxpayers $700 Billion http://www.saundramcdavid.com/index.php/2008/09/21/greed-and-self-interest-cost-us-taxpayers-700-billion/ On Politics Wed, 09 Sep 2009 17:27:19 +0000 http://wordpress.org/?v=2.9.1 hourly 1 By: Drew Deichmann http://www.saundramcdavid.com/index.php/2008/09/21/greed-and-self-interest-cost-us-taxpayers-700-billion/comment-page-1/#comment-206 Drew Deichmann Fri, 26 Sep 2008 12:59:38 +0000 http://www.saundramcdavid.com/index.php/2008/09/21/greed-and-self-interest-cost-us-taxpayers-700-billion/#comment-206 Thanks Saundra for your insights. I think its important though not to forget our responsibility in creating this mess. The American people have shown a negtive savings rate in 2005, 2006 and 2007. We have fueled our recent years GDP growth largely on credit - either home equity loans or credit card debt. The belief that "you can have it all and have it now" has placed a current consumer debt load of 9.9 Trillion dollars on this nation. Just under half of the US households which carry credit card debt month to month; we average $9,000.00 per houshold. So when we look closely - it is us, the public, who is at least partially to blame for our reckless use of credit. We would do well to remember this fact when considering how we "solve" our national economic problems. Drew Saundra's Comments: Excellent comments Drew! I agree. Once again this goes to finding the root of the problem. $700 Billion to our financial institutions without a major change in lending practices and consumer and corporate behavior is irresponsible. Thanks Saundra for your insights. I think its important though not to forget our responsibility in creating this mess. The American people have shown a negtive savings rate in 2005, 2006 and 2007. We have fueled our recent years GDP growth largely on credit – either home equity loans or credit card debt.

The belief that “you can have it all and have it now” has placed a current consumer debt load of 9.9 Trillion dollars on this nation. Just under half of the US households which carry credit card debt month to month; we average $9,000.00 per houshold.

So when we look closely – it is us, the public, who is at least partially to blame for our reckless use of credit. We would do well to remember this fact when considering how we “solve” our national economic problems.

Drew

Saundra’s Comments: Excellent comments Drew! I agree. Once again this goes to finding the root of the problem. $700 Billion to our financial institutions without a major change in lending practices and consumer and corporate behavior is irresponsible.

]]> By: Lisa http://www.saundramcdavid.com/index.php/2008/09/21/greed-and-self-interest-cost-us-taxpayers-700-billion/comment-page-1/#comment-202 Lisa Tue, 23 Sep 2008 15:01:28 +0000 http://www.saundramcdavid.com/index.php/2008/09/21/greed-and-self-interest-cost-us-taxpayers-700-billion/#comment-202 Phil Gramm may not be the villian you make him out to be. How is Swiss Bank UBS doing in this crisis? It could be said that those banks that are diversified (as a result of deregulation) are the ones who are doing better through this mess. Subprime mortgages are the vehicle that got more money in the system, mortgages made to people who had no ability to make payments when interest rates adjusted. Here is an alternative viewpoint : http://article.nationalreview.com/?q=Mzk3MzFiYWY3NjUyNzUyNzA4MzYzNTk2ZDVhMDFiMWE= Saundra's Comments: Thank you for this article Lisa! UBS is not faring well. In April it took a $19 billion writedown, "UBS were caught in the sub-prime story, like many others. They put a lot of stuff off balance sheet and these vehicles were extremely highly leveraged. US real estate was the name of the game to make money in and they [UBS] went overboard, and their risk controls were very bad.” From: UBS losses send a shudder through Switzerland http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3663980.ece The bailout is addressing the symptom, not the cause. People can no longer afford to pay their mortgages. Solve THAT problem, and the rest of the problems go away. Phil Gramm may not be the villian you make him out to be. How is Swiss Bank UBS doing in this crisis? It could be said that those banks that are diversified (as a result of deregulation) are the ones who are doing better through this mess.

Subprime mortgages are the vehicle that got more money in the system, mortgages made to people who had no ability to make payments when interest rates adjusted.

Here is an alternative viewpoint :
http://article.nationalreview.com/?q=Mzk3MzFiYWY3NjUyNzUyNzA4MzYzNTk2ZDVhMDFiMWE=

Saundra’s Comments: Thank you for this article Lisa! UBS is not faring well. In April it took a $19 billion writedown, “UBS were caught in the sub-prime story, like many others. They put a lot of stuff off balance sheet and these vehicles were extremely highly leveraged. US real estate was the name of the game to make money in and they [UBS] went overboard, and their risk controls were very bad.” From: UBS losses send a shudder through Switzerland
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3663980.ece

The bailout is addressing the symptom, not the cause. People can no longer afford to pay their mortgages. Solve THAT problem, and the rest of the problems go away.

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