Monday, September 15, 2008

Now they are both full of it.

Obama and McCain have both made statements that the financial failure that are occurring will not happen on their watch.

OOHHH PULLLease. As if anyone could keep that promise. Besides if they could keep it that would be a bad thing. The failure of Lehman Brothers, Merrill Lynch, Freddie Mack, Sallie May etc..etc... where caused by something I like to refer to as" the free market". yes the financial genius at these companies got carried away and made bad decisions and now they are paying the price. Just like a lot of Americans accrued more debt then they could handle and are now paying the price. The Market rewards good decisions and eventually punishes bad decisions. Here is a novel concept people in the market must be responsible for the consequences of their actions. Ohh wait we do not believe in responsibility.

If we regulate away the ability of people to make bad financial decisions they will be limited in the amount of risk they can take and some highly profitable good decisions will be foreclosed to them thereby limiting the ability of the market to work. Two sides same coin. Some bad decisions have to be made to get some good ones. You have to have failures in order to have success..

All these "bad decisions" that these companies made and which eventually caused their
failure allowed these companies to make a lot of money for a lot of years. Introduced new capital into a lot of markets. Allowed a lot of people to buy homes who are not loosing there homes.

I would love to see some economist do a study as the whether the whole thing was a net gain for the economy a loss or a break even. Wouldn't that be interesting.

lets not Panic. do not through the baby out with the bath water. We will experience some short term pain, some more then others (and perhaps deservedly so) but we will easily survive this and if we do not overreact be better off in the long run

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