Tuesday, October 14, 2008
Bailing out the Banks
Economics is not my strong suit, but I really do wonder about the governments (read "tax-payers") of the world bailing out the banks and buying up toxic mortgages. My free-market impulse is repelled by such socialist activism. Likely it will help my personal MF portfolio (which is cool), but ought we to be happy about the developments of the past days? And what happens when the other shoe drops? What will happen when all the tax-payers' money the governments are injecting into the mess is lost? I'm guessing it will be sucked into the abyss. Let Wall and Bay Streets clean up their own undisciplined mess. Let the banks and mortgage companies clean up their own messes. Why should governments (read"tax-payers") be forced to hold radioactive mortgages? I'm all for everyone owning their own homes, but really, should a guy who earns $12 an hour working at Wal-Mart be able to own a 1/2 million dollar home by way of a zero down sub-prime mortgage scheme? That's an unrealistic expectation.