The economy of the United States of America monopolizes the national as well as local news and casual conversation everywhere I turn, so I might was well put some of my thoughts out there.
My political leanings fall somewhere betwixt libertarian, capital “L” Libertarian and total anarchy with heavy doses of States’ Rights and Individual Rights in the mix. While I don’t profess enough economic knowledge to introduce a solution to the USA’s economic status, I do feel that massive infusions of borrowed money will not work as predicted. Although it will be painful for nearly everyone there are institutions and individuals that need fail and hopefully teach those who participated in the failures a valuable lesson, unfortunately the hard way.
People toss around the phrase “too big to fail” all the time. I’m uncertain of exactly what it means, but if I’m right in my assessment I don’t agree with it.
On the topic of our domestic auto industry, that’s easy. There has been no American vehicle I’ve wanted to buy in 25 years. Well, Pontiac had one recently, the new GTO circa 2001-2006, but it was made by the Australian arm of GM where it went by the name Holden (or Vauxhall) Monaro. When the European car enthusiasts on TV and print media criticize your fit & finish , styling, and reliability you KNOW you are doing something very, very wrong. We’ve toyed with the idea of buying a Ford work truck, but our past experience with their business practices were so negative that it is out of the question. Looks like a used pickup is in our future.
With regards to our nation’s property value and foreclosure problem, my wife & I are, in general, much more experienced and savvy in business matters than a large percentage of the population. Claire and I, in each and every home purchase with which we have been involved, have been pressured to buy more house than we wanted or needed. The lending officers would use lines like “don’t buy the house you feel you need now. Think about what you will want in the future!” We didn’t fall for it, but I can see where such tactics can, and obviously do, work. While it is true that buyers should take part of the blame for getting in over their heads, unscrupulous predatory lenders are at the root of this mortgage crisis.
My favorite outright lie told to us by a loan officer was the following one. We told him, eye-to-eye, that the reason we were choosing his bank for our loan was his assurance that our loan would not be sold so we could have the ability to handle payments at local branches in Knoxville. We made exactly one single payment to First Tennessee Bank before they sold it to Chemical Bank. Obviously, that loan officer was either totally incompetent or was a bold faced liar. I have no reason to doubt it would be different elsewhere.