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Posts Tagged ‘lending’

         Ok, I dont understand this whole financial mess…I admit that.  I am no financial genius.  However, I do know that if you keep spending money that you dont have…you go deeper in debt.  How in the heck is the government going to get money from people who dont have it to give?  From taxpayers….correction…from taxpayers who have JOBS.  What about all of those people who dont have JOBS  or will soon be loosing their JOBS?  The American family is in crisis.  Many dont have jobs or they have to have more than one part time job to make ends meet.   Some don’t even have homes because they have lost them to foreclosures.  Some of their family members dont have jobs or can’t make enough to pay their bills.  But when you are barely making it…you can’t help anyone else out in a meaningful way either.  The Government financial recovery plan (mess) is mirroring our personal lives…they just dont know it yet!  Still, some of the leaders are using fear to try to get people to put their stamp of approval on their plan of action; they are saying that this might not be the right answer…but we have to do something or else!

         Obama’s treasury chief has announced that this country needs 2 trillion dollars to save the banks.  This is on top of the bailouts that have so far shown little return on the investment for the average American citizen.  Where is this whole thing going to end?  Why not give the money to the citizens and let them dig themselves out of their own very deep holes first?   That in turn might just have the added benefit of allowing them to pay off their loans and homes to those banks and businesses that made the bad loans in the first dang place!

          We are being told that all of this lending and loaning may or may not work….that they might make mistakes.  But that doing nothing would be a catastrophe.  How do we know that?  Maybe those businesses and banks should go under.  After all….once this money is loaned to these businesses and banks…they are going to expect tax payers to go into debt once again with these banks and businesses to circulate the money.  Who in their right mind is going to create an even bigger debt load on themselves with such uncertainty hanging over this country’s head?

        After President Obama’s treasurer spoke the Dow Jones dropped 3.5%.  This is traumatic news to everyone.  Confidence is more than shaken….it has suffered severe trauma.  We may never recover from this extreme mess as a nation.  This isn’t some meaningless recession.  We are bleeding money and we dont have the confidence in our leaders, our banks, our businesses to recover from it. 

         Former Presidential candidate, Senator John McCain calls this plan “generational theft”.  He says we are stealing from future generations their hard earned dollars and laying on them debt of incredible proportions.   He is right.  Where will it end?

           The Government thinks it is going to help everyone out by creating JOBS and bailing out banks and certain industry giants.  Helloooooooooooo…is anybody home out there?   How in the world are they going to do this?  By hitting the taxpayers out even more than they have already.  So far, no one has had a solution that has made a positive enough impact to change the direction of this massive financial failure!  What makes them think that throwing more money into the mix is going to make things better?  Can a government file bankruptsy…cause that is what it feels like is happening here…what is the old saying….borrowing from Peter to pay Paul?

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        The Sky is falling…the sky is falling…does anyone remember that saying from the children’s story…Chicken Little?  That is how I am feeling today about the hysteria surrounding the money markets.  The more that the warnings go out…the more hysteria that takes place, which then makes the markets more unstable.  The dow is beginning to resemble a roller coaster ride.

          I fell for it…and i am sure there are others who are biting the bullet as far as the panicked feeling.  Everyone is panicking.  Other countries are panicking too.  Because of it…the instability is contagious.  Everyone needs to stop….take a deep breath and let things settle for a few days.  Don’t sell out of panic…don’t buy out of panic…just stop and let things settle into what they are; do what you normally would do.

          I know the need to protect what you have worked for, i know the need to keep your personal finances bubblewrapped to the best of your ability, i know the fear that won’t let you sleep because you may not be able to send your kids to college, retire, or live without too much heartache with your daily spending.  Truth is, most of us needed to tighten our belts and live the way we were taught which is to save up to buy what you want…not overextend yourself with credit and pay as you go.  This is common sense.  It is also common sense to establish some credit…but you must be vigilant and pay it as it comes due…not let credit become the disaster that it has become.

          Businesses, banks, real-estate companies all are in the position that many of us regular people have been in.  The problem is that they can’t operate if their customers can’t pay.  We can’t pay if we don’t have jobs or homes to live in.  It is a vicious cycle.  Everything needs to stabilize long enough for an honest evaluation of where we are at.  At the moment, it is like a lake that has had a boulder fall from the cliffs into the center of the lake; there are ripples that are still rocking the boat floating on the surface.   The shifting that keeps taking place is definately keeping the extent of the damage unclear.

         Putting measures into effect to try to “correct” the market is just going to continue to keep things out of control.  This whole financial crisis is scary as heck…i won’t deny that.  But, we have no accurate way to measure the actual scope of the damage.  There is something to be said for an old adage such as, moderation in all things. 

         The people & companies that put us in this situation are going to have to make better decisions, they have to have consequences for the mistakes that they have made, and they are going to have to put procedures into place to prevent repeating the same mistakes.  The housing markets, the oil companies, the credit card companies and the banking industry all need to take stock of how they have each added to this disaster, and do a review of business 101.  Make more than you spend, lend less than you can afford to lose, and build trust and relationships with your customers!  What a novel idea…we can all learn from those practices.

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