The economic crisis–chickens coming home to roost.

From the Associated Press headlines this morning:

Lehman Brothers, burdened by $60 billion in soured real-estate holdings, filed a Chapter 11 bankruptcy petition in U.S. Bankruptcy Court after attempts to rescue the 158-year-old firm failed. Bank of America Corp. said it is snapping up Merrill Lynch & Co. Inc. in a $50 billion all-stock transaction. The demise of the independent Wall Street institutions came as shock waves from the 14-month-old credit crisis roiled the U.S. financial system six months after the collapse of Bear Stearns. The world’s largest insurance company, American International Group Inc., also was forced into a restructuring.

So. Lehman Brothers follows Bear Stearns and Fanny Mae and Freddie Mac into financial ruin. The stock market tumbles and the dollar falls (again) against the Pound Sterling and the Euro. Everyone in banking is biting their nails (when they arent busily gobbling up the leftovers from the failed investment houses that is) because everyone wonders “what next?” Im here ta tell ya, it dont take no crystal ball to figure that one out baybeh.

As far as Im concerned, this is all poetic justice. For far too long, this country has concentrated on helping corporations and banks, giving them tax breaks, legal loopholes, ability to safely go offshore without any penalties (costing us Jobs!), giving them the power to penalize late mortgage or credit payers with exorbitant fees and penalties, and generally making it impossible for anyone to keep their head above water financially.

So what is the result? Folks cant make their mortgage payments because of crazy contracts that have balloon payments or variable interest rates, or ridiculous housing prices so inflated it takes 2 incomes to pay for them (but oops your company just went overseas, sorry) and hardworking folks everywhere are suddenly without the means to pay for their homes and SURPRISE! A veritable landslide of defaulted mortgages, cars, whatever. Banks now have a glut of homes to try and get rid of in a climate that cant find home buyers because why? Oh yeah, no more work….

So, bottom line is, they are now stuck with a bunch of properties they cant offload, they are saddled with reams of defaulted debts and guess what folks, the forgotten, neglected, belittled CONSUMER is finally FINALLY going to have the last laff. Its a NO BRAINER: Lawmakers, you allow companies to go offshore (which means less jobs here in the USA), you allow agribusiness conglomerates to gobble up family farms, you hamstring a debtor’s ability to repay their debts, you concentrate on helping banks instead of helping the folks putting the $$$$ in the banks, YOU ARE GOING TO PAY THE ULTIMATE PRICE. Thats what you get for being GREEDY and I’m laffing my ASS off over here. Because I know that until the jobs come back and the corporations are held in check, this is JUST THE BEGINNING!

And then this:

Ten banks — Bank of America, Barclays, Citibank, Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, Merrill Lynch, Morgan Stanley and UBS — each agreed to provide $7 billion “to help enhance liquidity and mitigate the unprecedented volatility and other challenges affecting global equity and debt markets.” The Federal Reserve also chipped in with more largesse in its emergency lending program for investment banks. The central bank announced late Sunday that it was broadening the types of collateral that financial institutions can use to obtain loans from the Fed.

What I want to know is, why are all the banks rallying around to give bankrupt banks HUGE sums of money to avoid bankruptcy but if WE default on even ONE payment we get slapped with penalties and fees?  I mean, if a debtor has a problem making the scheduled payment, where’s the logic in adding MORE for the debtor to pay?  Only a BANKER thinks that makes sense!!!  Not only that but I find it highly ironic that these same folks all got together and had newly elected President Bush sign off on punitive debt collection measures, among which were the narrowing or elimination altogether of debt relief measurers historically used (bankruptcy).   We cant do it but THEY CAN and not only can they do it, they get a helping hand from other Banks!  You know where all that 70 billion came from right? From every single sweaty nickel they’ve gouged out of US! There’s just something plain LOPSIDED about the way this whole thing is structured


~ by irishgrl on September 15, 2008.

2 Responses to “The economic crisis–chickens coming home to roost.”

  1. Hi, Friend
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  2. Thanks for your kind comment and spread the Blarney Love all over the net! (that means tell all yer friends to come see my pithy prose!) I hope you look around at some of my other articles, Ive got a nice mix of satire, humor, weird, and rants. Anyway, thanks for stopping by and I hope you keep visiting 🙂

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