The federal government is in a panic. Their actions are perpetuating a problem that can only be solved by staying out of the “solution”. The current mortgage crisis was brought on by lending large amounts of money to people that could not afford to pay it back. It is also impacting the people that jumped into the real estate market, “flipping” properties for profit, and getting caught with too many properties and not enough buyers. Timing is everything when it comes to the risky business of flipping property.
The government’s solution to this, borrow and print more money to give to people to “stimulate” the economy. So the problem is going to be fixed by borrowing more money? I don’t get it. The banks that were buying and betting on these loans made a bad bet. And like every bad bet, the price must be paid, and the consequences felt, no matter what that means. If the government bails out these institutions, it will send the message that this practice is acceptable, and no lesson is learned. Will it hurt some of us? You bet, but the market will correct itself faster without these government programs which will only prolong the pain and make things worse in the long run.
Congress could do a few “simple” things to stimulate the economy; cut corporate taxes from the highest in the world 35% to 20%, cap spending at 20% of GDP (by law), and allow drilling for oil here to reduce foreign dependence, sending a message to the oil producers of the world that we are not playing their games anymore. Oil prices would drop, and goods and services would follow. None of these increases government debt or intrusion into the market. There are other things to do but this would be a good start.
Credit is a huge value for the economy when used and extended wisely. Our government is out of control with spending, borrowing, and meddling in the market. It is time to start sending government finance people to jail for mismanagement of our tax dollars. If any private business was managing the stock holder’s money the way the federal government is handling our tax dollars, they would be brought before a congressional committee, put on trial, and sent to jail. It is time to start doing the same to the government bureaucrats that are flushing our future down the toilet. Just a thought…
True knowledge of American history is necessary to insure the future of the America we love… This is an important time in our country's history. We must be wise and measured as we choose our leaders going forward.
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