Guys who caused financial crisis oppose efforts to bail out people who aren’t them.
Posted on February 19th, 2009 by Punning Pundit
Here’s the thing: if you were one of the people who over-leveraged America to the point where a few people defaulting caused the entire system to collapse– if you were one of those people, STFU. Let us fix the problems that you caused, and we won’t shove you up against the wall because the revolution need never get violent.
Idiot.
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If we don’t subsidize “undeserving” people’s mortgages, the market will explode with empty houses that no one wants to buy and that sounds to me like a bigger problem for the economy than helping out someone who should not have gotten a housing loan in the first place to not default on their payments. Furthermore, if someone does not initiate massive spending into the economy today, aka Uncle Sam, then we would be pursuing the same “solution” to this recession as we did in the 1930′s. Which is to say, sit on our hands and “let the market correct itself.” That philosophy did not work and the situation did not improve until WWII when, surprise, the government suddenly infused massive amounts of money into the economy. Santelli sounds like a bombastic moron.
Now, I’m no analyst, but I highly doubt you can attribute the blame for this recession to a simple cause as Santelli’s loud mouthed rhetoric implies.
Here’s what I know:
Housing investment over the past several years had become so insane that firms were buying and selling mortgages like flipping pancakes and investors were knocking down doors trying to find a place to put their cash. This lead to the ridiculous situation where anyone could get a substantial mortgage without background checks and subsequently, a lot of defaulted loans.
Also, for years credit card companies cultivated a system where the ideal client was someone so deep in debt and interest to them that they can’t get out of it. They intentionally crafted their contracts to make it easy for a client to easily accrue high interest debt. Now you see that backfiring on them.
Now, I’m not an expert on banking but I do know about this little thing called the Glass-Steagall Act put in place after the Great Depression to regulate commercial and investment banking. I don’t know how a lot of financial things work, but I’m told prior to this act, there was a lot of wreckless spending going on in a very volatile investment market. When the market tanked, so did these banks. That in turned tanked American economy and life. This act was put in place to prevent that from happening again. But now you hear about banks needing huge bailouts because of their wreckless spending. History repeats itself…
Now we’re in a situation where no one with money wants to invest into the market because everyone is reeling from the financial collapse and further risk. So businesses are tanking because no one is spending and job prospects are shrinking because surviving businesses are trying to keep head above water.
We need to rescue the market, even if we rescue a bunch of “undeserving” people in the process. It would be suicidal not to proverbially “throw” stimulus money at the market right now.
I neglected to include an important detail about the Glass-Steagall Act. It was repealed starting in 1980 and no longer functions today. I was therefore suggesting a connection between the repeal and our current economic circumstances. Hence, history repeats itself.
But if you want to know the root cause of this whole economic crisis, it is age old. It is the greediness and short-sightedness of every individual who participates in the economy, which translates as much to consumers as to owners and investors. The greedy self-centered attitude at the core of it all is present to one degree or another in the hearts of almost every person today. Mr. Santelli himself demonstrates this attitude above, when he openly states his feeling that only certain people should benefit from the stimulus and others are unimportant–he, of course, is to be considered one of the important ones.
How much of an idiot do you have to be in order to realize that if your income cannot cover your mortgage you cannot own a house? It’s as simple as that. It doesn’t take a finance degree to understand the basic principles of a loan. A certain level of common sense, yes. No, if you do not put anything down on a house and your payment is practically nothing, you have not hit the lottery. You are not very lucky. You’re an idiot who thinks you deserve something more than a person who works their entire life saving and THEN spending a portion of that income on a home. Yes there is greed. Yes capitalism is not perfect. Yes if you’re not careful you can have the rug pulled out, but care and common sense are taught before you’re able to get a driver’s license.
Go FY if you believe that the fault of this mess is strictly based on Wall Street, you dm ignorant ah.