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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (70413)	9/16/2008 6:42:04 PM
From: Maurice Winn	1 Recommendation Read Replies (1) \| Respond to of 74559

He did warn against irrational exuberance. Also, he is well aware of human frailty including the lolly scramble effect. His job is to run money, not run a social welfare central planning economy telling people they can or can't borrow by keeping interest rates excessively high. Deciding to borrow or not is a market function between borrowers and lenders. There is an infinite array of lenders and borrowers with what they want varying day to day and minute to minute. The USSR model Kremlin-based central planning socialist ideology simply does not work. Socialists do want central control and planning and Nanny-stating of borrowers and lenders, but free market ideologues like me are happy to leave it to Lehman Brothers management to decide whether to lend or not and to house buyers whether to borrow or not. In the early 1980s I was told by a bank that I couldn't borrow as much as I wanted to buy a house. Because of our life style I could very easily manage the amount I had wanted to borrow. They were using dumb rules probably set by the government central planners. It was very annoying. If he had left interest rates high, it would have meant greater economic dislocation during and after the Biotelecosmictechdot.com market clearing process, perhaps of very nasty proportions. Then there was the 911 attack in the midst of the market crunch. Yes, interest rates should have been raised sooner than they were and faster and that would have reduced the housing speculative frenzy. But here in NZ the same process has gone on. People still think they are okay here, despite what has happened in the USA, though the NZ$ has fallen quite a way from the peak and house prices have been sagging slightly. Blaming Alan Greenspan for creditor bankruptcy crashes is like blaming Ferrari for people crashing them when driving them recklessly. Yes, Ferrari could put a speed limiter on them so they can't do over 100 kph, but that still wouldn't mean no crashes as people would drive them on narrow twisting roads to get some thrills and crash even more than on high speed safe freeways. You extreme left socialists just don't want people deciding on matters for themselves. Mqurice