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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Steve Lokness who wrote (126878)	12/10/2009 5:38:02 PM
From: Mary Cluney	Read Replies (2) \| Respond to of 541747

<<<If two families are living side by side - yours and mine. You take out a loan and go shopping and I instead put my money in the bank. What happens? ...Now think of the two neighbors as countries. And think of this played out year after year after year compounding the interest. Pretty soon you are broke and indebted to me forever while I go around the world and buy up all kinds of things I want.>>> WOW. I object so much to this right wing notion that the global economy almost totally collapsed as a result of poor people in the US borrowing and spending money they could never hope to pay back. This had NOTHING to do with borrowers. NOTHING. NADA. This portion of the blame games goes entirely to the banks. They held all the cards. They have (had) all the money, the computer systems, the lawyers, access to credit agencies etc. They had fiduciary responsibility to their share holders to make sure they made loans responsibly. The notion that the fault was in the hands of the borrower is so false. In fact bad loans were only one small factor in the global financial disaster. The much larger culprit were those financial insitutions (including banks) that were making those huge bets at 40 to 1 leverage with no hopes of paying off those bets if those bets failed. <<<If Bernanke is doing the right thing, then how in the world did we end up at this point since he is in charge of finances and is the expert on the Depression. if he was such an expert shouldn't he have been able to prevent it?>>> WOW. And WOW again. This Austrian noton that it would have been better if nothing were done is SOOOO wrong. Even the intellectually challenged George W Bush was able to recognize (I am paraphrasing) "holy shit, this sucker can go down". We were so lucky we had Bernanke at the time we did. He prepared his entire life for this moment and he came through. If Bernanke did nothing to bail out the banks, the sucker (global economy) would have gone down. We would be in a global depression. Make no mistake about that.