"A jar of whiskey for my drunken friend!"
The Fed is bailing out Fannie Mae and Freddie Mac.
Removing market forces and corrections helps us... how, exactly? In the long run?
Labels: economy, government, Gripes, jeering
posted by Matt G @ 6:44 PM
3 Comments:
You're just pissed and bitter because you're fiscally responsible, and won't NEED gobs of cash to bail you out.
I'm honest to God on the fence on this one, and I've deleted 3 different attempts at communicating why.
I HATE that the gubament (on any level) is bailing people out of a stupid situation, but there are a ton of other examples where tax funded entities rush to other people's aid on a daily basis.
I think that ,in the situations where people falsified information regarding their income and/or employment information, that those people should be strung out to dry.
But I also realize that failing to step in and assist people on a sweeping basis can have a catastrophic ripple effect on an already unstable economy.
People who have destroyed credit due to the realestate fallout end up unable to continue purchasing goods (and rightly so, if they were LIVING on credit), and that leads to retail closings, putting more and more people that WERE able to make their rent/mortgage payments out of work, then THEY end up defaulting.
I dunno. I believe in a hand UP, not a hand OUT, but its SO hard to decide where to draw that line.
Jason,
Part of the problem is that the economy regularly goes through boom and bust periods. When the government says "Don't worry. We will save you," it takes the market forces out of economics and encourages reckless speculation. Whether these are people buying houses they cannot afford, or people flipping houses, or people pushing irresponsible mortgages, or something else does not really matter. The government is encouraging the next boom and bust by decreasing accountability. Yes, there are other government handouts. That does not mean that they are good or that they justify propping up the real estate market.
Why is the government trying to make owning a home out of the reach of so many people. That is the effect of supporting the inflation of housing.
Maybe they should supplement the rent of people who cannot afford to buy homes.
Since the price of oil has dropped about $20 a barrel in the past week, should the government step in to bail out speculators who were counting on inflation to make them rich?
We are teaching people that they do not need to be responsible, that they do not need to manage their money, that there is always someone with deeper pockets.
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