Dead Horse

[gamavor]

Criticizing this administration is like punching a dead horse in the face. Disgraceful. But I personally hate to be taken for a sucker.

 

I rarely comment on domestic issues (meaning American on Indian soil), but the latest debacle with the lending crises and screwed up homeowners deserves attention because it quickly became international problem thanks to the farsighted policies of the mortgage companies that swiftly shared the “hot potato” with their European, equally greedy partners. It is a classic in the business genre. For the first in line the game is called “sharing the risk” – for the last in line – “security investment”.

 

First the good news. President Bush learnt a new word. Liquidity! The media and their heavy think-tanks couldn’t find out the meaning of the word – at least not in the first couple of days. One talk show host even seriously announced that it is something that has to do with liquids. And then as a thunder from a clear sky came the revelation from the President himself! Liquidity means CASH. In other words cash crises. However plebeian the explanation above the President was right, although liquidity in economic and legal terms means ability to be sold. Something that has value and can be easily liquidated, executed against cash. The speed in which something could potentially be alienated determines the liquidity of the asset or respective equity. But that is not what I wanted to comment about.

 

My utter frustration is based on the talks from the very top that homeowners (those with good credit that are behind because of increase of interest rates) should be supported by the government or government insurance agencies who for the most part use my and yours tax money! First thing first! Now, how come a debtor in good standing in steady economy is behind his payments and yet has good credit? Second. What happened to the basic principle of the market economy – supply and demand? Why would the government support albeit innocent homeowners with federal money and not research on reproduction of the Colorado beetle? What would guarantee that those that would receive government funding would be able in the future to keep up with their payments?

 

Some say it is more politics than economics (elections are coming) and the sad part is that some Democrats also hurried up to bite the bait. To me it is nothing less then hidden corporate funding in the system of corporate communism.