Today I awoke fairly early… and unable to go back to bed I decided to turn on the news and check how my portfolio was doing. This is not uncommon for me, seeing as both my parents are business type people. And there on my TV… it said Lehman Bros. filed for Chapter 11, also known as bankruptcy. Merrill Lynch to be bought by Bank of America. Washington Mutual has lost 90% percent of its stock value in the past 12 months. AIG is restructuring.
People this is a clusterfuck, if I have ever seen one. Not in the history of finance have you ever seen so many banks fail and the government not able to do anything about it.
These are the fruits of some of the administrations doing. People, I encourage you to see outside the box and understand what is happening. It is not only our future that is at stake but of our children and their children.
I will explain a simple way how all of this came to be. The Administration lowers borrowing rates for banks. Banks borrow cheap money, which the government really doesn’t have, which in turn leads to inflation. More people want to buy houses, therefore the law of supply and demand sets in , the value of houses rises. Banks lend money to those that can’t afford it. The Housing market bubble burst, driving the cost of house well below of what it was a few days ago. People with major loans from banks no longer able to pay their mortgage file for bankruptcy, or foreclose on their home, or even skip town. Now the bank is left with the debt of the original home and the home to sell. But the bank cannot sell the house because there isn’t any money to lend to those that might be able to buy the house. The bank has to much debt to pay back to the government, it’s stock holders start selling of their shares… the bank then either goes bankrupt or get bought out by another bank. The government does not get its money, it either has to raise taxes to recoup it or dig itself into debt.
And that is just the simple example. The polices of this administration has basically left the common people in shambles while the rich have gotten richer.
I have been very silent on the political front, here on my blog. There are many reason I do such a thing. For one, I try not to convey, or provoke arguments, 2) I believe in a few things that most people that call themselves christians oppose and 3) I really think that discussing politic should be a civil conversation done face to face. But I will share my opinion. McCain will follow Bush’s policies, these exact same policies that has bankrupt our economy, the same policies that have given tax breaks to the rich, while the poor has to pay more to make up the difference. Over the last few years the rich has gotten richer, while the 90% of the country, the non-rich, has been getting poorer.
How much do you think it’s going to cost you, a citizen of the United States, for the government’s buyout of Freddie and Fannie?
These are things that happening right now and that will affect all of us. Stop being told what is going on and educate yourself in what is really happening. The only tool against fear is knowledge. Stop being manipulated by scare tactics and open your eyes to what is happening.
I have already made a personal commitment that if things do not improve in the next few years I will move to Europe where it seems like there is the only really economic growth. It is not something I have come up with lightly. While I am well off, I cannot say the same for everyone.