I came across this quote today:
I believe that banking institutions are more dangerous to our liberties than standing armies.
- Thomas Jefferson
It seems pretty prophetic now especially when one thinks about how far and deep the impact of the the sub prime loan crash is being felt. I have friends in South Africa that are feeling the effects, friends traveling to Germany are concerned about a weak dollar as they exchange to the Euro, and hey, don't forget about my colleague that just told me yesterday he let his house go to foreclosure when the market dropped $100k below what he owed on it.
Here's another quote that people could have listened to and, had they headed his warning, we may not be seeing such a crazy popping of the bubble.
- Do not bite at the bait of pleasure till you know there is no hook beneath it.
2 comments:
I didn't think that banking institutuins caused the fall out from the sub prime lending fiasco. I believe that it was from the unscrupolis lending guidelines from every mom and pop lender out there trying to make a buck. I believe that the church teaches one to live prudently not beyond your means. and that is the biggest reason for the sub prime fall out, bad loan agents that did not due their due dilligence and people trying to keep up with the Jones, and getting Neg Am loans.
I agree that many people lived above their means, and that obviously is a key component of the crash. The 'unscrupulous lending guidelines from every mom and pop lender' are the banks I was speaking about. The underwriting guidelines were given from the large banks that I was referring to in the post. There are obviously a lot of 'reasons' for the fall out, but since it has been said that 'the people with the gold make the rules' I believe that there is a large responsibility that the banks bear to ensure they are protecting their gold in the long run, not just for short term profits. Having worked for some of these large banks I have seen the amount of money and energy that they put in to advertising the loans that are the thorn in everybody's side these days. Thanks for the post.
Post a Comment