It Doesn't Take an Expert...

I like to believe I am a fairly well educated man. Some college, but mostly educated through immersion. I read, and watch, and listen...and absorb everything I can. But when it comes to the economy...I can't say that I am well versed in that beast. But even I know(mostly from studying our past), that when the market is flooded, it eventually must drain. A quick history lesson will show that in the early 1920's, a new kind of home built by the Levitt brothers became the quickest and easiest way to own your own home. They made entire towns out of these pre-fabricated houses, aptly naming these places "Levittown(s)." These towns still exist in name, mostly in the Northeast. Now the great thing about these towns was that it made it easily within many peoples' means to buy their own home. This in turn, flooded the housing market for several years. But what should have been plain to see, apparently wasn't...What happens when everyone then owns a home? The housing market dies almost instantly. The same thing occurred with cars. There really wasn't a need for multi car homes in the 20's. So once everyone owned a car, the auto industry also died. The simple rule we learned from the great depression, just because everyone can afford something, does NOT mean that everyone should go get it.

Bring us back to present day. It seems that the current economic experts failed American History, because a few years ago, they again found a way to let everyone own a home...this time though, they were much more careless. Adjustable rate mortgages that are affordable at first, then outrageous 6 months into the loan made it so people could buy a home, move in, then when they realized they couldn't afford it, just stop paying. Now this didn't bother the mortgage companies, because every time someone defaulted on their loans, there was always another sucker waiting in the wings to buy the same home on the same kind of ridiculous terms. This worked out well until the day came, when all of the people who did not have the means to buy a home had been foreclosed on, and the people who already had homes, were forced to pick up the slack. This meant that their rates would rise in order to pay for those who shouldn't have ever been approved for a loan in the first place.

I don't know how the economy works. I don't understand the stock markets. But I know enough to know that I sure as hell can't buy a house. Not now, and probably no time soon. I am also smart enough, not to try to live outside my current means. My bills are getting paid, which is more than I could say a few months ago. But that is because my wife and I recognized a problem, and found a solution. And now we get to start over, trying to save and work our way, once again, to that dream of owning a home.

Our leaders have failed us. They have recklessly borrowed money for years, knowing full well that they had no way to repay it. And every time the bill came in, they would simply borrow more to pay it. Well, just like in "The Real World" eventually, there is just no more money left to borrow, and no one left to borrow it from. So now we are in our current situation. With  a group of leaders that would tell you that we are not that bad off. That our financial woes are nothing to fear. They would tell you this because in the end, not a one of them actually understands what they have done to this country. They have seemingly turned us into a second-rate America. You know it is bad when illegal Mexican immigrants, are returning home to find work! This is no longer the land of opportunity. This has become a land of liars, thieves and conmen, only looking out for themselves and leaving a trail of destruction in their paths. On top of that, you've got the credit bureaus with their fingers in everything controlling the job market, the housing market, the auto industry, and pretty much just pulling their marionette strings in Washington.

They thought it would be a good idea to bail out the banks...to make sure that everyone's money was still safe. I cringed when that happened. You know what would have worked? Take just a percentage of that money, turn it around and instead of bailing out the banks, and the auto industries...bail out THE AMERICAN PEOPLE! It would have cost less, to pay off most or all of the outstanding debts of the people than it did to bail out a banking industry that continues to flounder. Because by paying off the debts, the banks are getting the money anyway, but people would be able to start spending again, thus stimulating the economy, thus continuing our tradition as a strong and prospering nation. Last time I checked, the money the government used to bail out the banks, was money they got from the American people in the first place. So why didn't we get a say in how it was spent?

Repeating history is not a new concept...but apparently it is also one that won't be going anywhere any time soon. As long as we have leaders who can't learn from the mistakes of their predecessors...we will continue to decline as a people. This blog has subsequently made me furious, so now I must got drink copious amounts of coffee and try to figure out how to save the world!