Heres a link below to a video that explains our country's credit crisis. Its real easy to follow, and Americans should be aware of it.
http://vimeo.com/3261363
The housing/credit crisis isn't anywhere near over; risky subprime loans got us into the trouble we're in now. I believe subprime was just the tip of the iceberg this option arm(adjustable rate mortgage) crisis which will happen in late 2009 early 2010 when these artificially low interest rates reset to much higher rates turning a $700 mortgage per month into a $1400+ mortgage per month, it will completely cripple the housing, credit and stock market. (See picture on top)
The subprime loans were risky and hit poor Americans hard, Middle America got these option arms, and pretty soon we'll see a lot of middle class people default on their mortgages, and that will have a domino effect on our economy. Banks still aren't lending money even after the $700+ billion they got from the bailout.
Thanks for the post and the video, it was very well done. Why not nationalize the banks, then?
ReplyDeleteYou can't nationalize banks because the government would probably do a worse job than these executives. The government doesn't know how to make money, all they know how to do is borrow, and spend money. Real buisnesses can't afford to have a $2 trillion budget deficit at the end of the year. Right now our country needs to produce more, consume less, and save our money. The government doesn't understand that, they think we need more illegimate credit so we can consume more, and discourage savings. That Keynesian way of economics has caused our country's financial hardship, and if continued will cause our financial collapse.
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