The Rolling Jubilee

[Ephirith]

Hate to say it but all the people who went bankrupt aren't 'victims', they weren't preyed upon by some malevolent financial system.

They made poor financial decisions, using the equity on their home to buy ipods, daily $5 starbucks, and massive plasma televisions. The people who weathered the crash were people who invested wisely, lived within their means, and saved money.

I'll give you an example using the case of my sister:

Before the crash, my sister sold her house to buy a more expensive one in a nicer area. My dad, well aware of the housing bubble, told her to sell her house for a large profit and live in an apartment or rental for a while. My sister bought the house, got a mortgage, bought a boat, dumped money into improving the house, went to Hawaii, and saved almost no money. Then the market crashed and they lost everything.

The purchase of the house was an emotional decision driven my affluenza, and a failure to recognize what a serious financial issue it is to take a high interest-rate loan to finance a house. For decades prior it was almost always a sound financial decision given the appreciation of home value, and Americans are fucking obsessed with owning a home, so many didn't give it a second thought.

Instead of taking responsibility for their decisions, like adults, many blamed the financial system. I hardly believe they deserve a bailout.

[pasi]

Instead of taking responsibility for their decisions, like adults, many blamed the financial system. I hardly believe they deserve a bailout.

Curious, do you believe the financial system deserved a bail out?

[Ephirith]

Originally Posted by pasi [You must be logged in to view images. Log in or Register.]

Curious, do you believe the financial system deserved a bail out?

Did they deserve it? Absolutely not.

Was it necessary to protect economic growth? Maybe.

[HeallunRumblebelly]

Originally Posted by pasi [You must be logged in to view images. Log in or Register.]

Curious, do you believe the financial system deserved a bail out?

Most of the bailing out included governments honoring debts. Most of these banks and financial institutions were FDIC insured and eligible for such bailing out, though the fact that it happened on such a large scale was the issue this time.

The obvious answer is to put risk back in the banking world. You can lend money out at lower rates with government backing, but when your loans go to shit (as in this case they were intended to go to shit, so they could throw out as many loans as possible, because in large part the government forced them into risky lending) sometimes you gotta suck it up and take the loss. That is one of the primary purposes of a credit rating: the likelihood of this person fucking you and hurting your business. As it stands it's just an excuse to charge people more on loans of all kinds.

[Ephirith]

Originally Posted by Ephirith [You must be logged in to view images. Log in or Register.]

but all the people who went bankrupt...

...They made poor financial decisions,

If this is what you're taking issue with than you're right to do so. I didn't mean to be so sloppy applying the "all the people" to the rest of the post. Not everybody who lost their homes grossly mismanaged their money.

My point was, everybody who lost their home did assume risk when they entered into the mortgage. Financial irresponsibility is so prevalent in the US that I think it played into the majority of situations, but not all.

How do you think it makes somebody feel who, after years of working hard, saving money, making smart investments, and forgoing luxury, puts a massive sum of money down on a house or, speak of the devil, actually buys the house-- only to watch hordes of people scream and cry because they were "swindled by those bankers".

When somebody hands you $150,000, or $150,00 in property, and expects you to pay it back plus interest......... you have to pay it back plus interest. I don't see how we systematically, as a society, ignored the fact that this stuff is HUGELY FUCKING RISKY.