America's Financial Meltdown

I’ve been watching the meltdown in the financial markets, and I have to admit that I’m worried about it. Not that I’m an economist or anything. I don’t have a firm grasp of what triggered what, but from what I’ve seen, there’s no need to worry that this is a meltdown on the scale of the 1929 collapse that triggered the Great Depression, as some people are hinting at. But it’s a mess, any way you look at it. The Bush administration has formally proposed to Congress what could become the largest financial bailout in United States history, requesting authority for the Treasury to buy up to $700 billion in mortgage-related assets from financial institutions based in the United States. $700 billion represents a fairly significant problem, if you ask me.
The one thing I’m tired of hearing, though, is that the companies that are failing are doing so because of “bad lending practices”, inferring, of course, that they loaned money to the wrong people. I don’t think that’s quite fair to the hundreds of thousands of Americans who have lost their homes in the past few years. Of course, I’m drawing upon my own experiences. What I’ve seen with my own eyes has been people getting backed into corners by their mortgage lenders, whose predatory business practices have seen banks all-too-ready to toss people out of their homes to get their hands on the assets.
When I lost my own home, there were at least five houses in my neighborhood that had been foreclosed upon by the infamous Countrywide Financial. From my own experience, I surmise that when those people found themselves in trouble, rather than finding their financial institutions willing to work with them to resolve the problem, those people found themselves being forced into foreclosure. When my wife and I got behind, our bank’s idea of helping us out was to expect us to pay an extra half of a house payment every month. So in spite of the fact that we were already in trouble, they thought it was reasonable that our monthly payment go from $750 a month to $1,175. And by the time the wife had taken off and I was trying to keep the house myself, I was paying $1,500 a month. Not once did our bank ever seriously try to work with us. Their attitude from the beginning was “here is your option … deal with it”.
Why am I going over all this? Because I’m tired of hearing media outlets and financial gurus infer that those Americans who have been forced into foreclosure represent “bad lending practices”, meaning that banks gave money to the wrong people. I contend that it’s not “bad lending practices” that forced the financial meltdown that has the Government in a panic, but “bad business practices”. Quite simply, if so many pedigreed college graduates at these financial institutions hadn’t considered the acquisition of assets in the form of foreclosed properties to be a priority, thereby perhaps swelling their quarterly bonuses, we wouldn’t be in the mess we’re in now. Do these fucks honestly expect us to believe that the mortgage crisis was created by a bunch of deadbeat mortgage holders?
I’m sorry. I know quite a few of the people who lost their homes recently to foreclosure. Every one of them has a horror story about being backed into a corner by their bank. Every one of them had invested a lot of money into their mortgages, only to loose everything when the banks shrugged in indifference. So yeah, maybe I take it a little personally when the financial experts say that people like me represent “bad lending practices”. I was a truck driver who was making damned good money. I could have easily have dug my way out of the unexpected hole my wife and I found ourselves in. But what I found was the bank wasn’t interested in working with us. Their idea of help was “Well, instead of just making one house payment every month, we’ll let you make one and a half until you get caught up”. Gee. Thanks. That’ll really help us weather our financial crisis, won’t it?
I guess what I’m saying is that from where I sit, this is a self-created problem. Predatory lenders like Countrywide thought that collecting foreclosed houses was a quick and easy way to add value to their company’s portfolio by inflating their assets and holdings. What none of these college-educated pinheads seemed to realize was that in the real world, each one of those foreclosures represented a loss of revenue, with each one being a revenue stream being shut down.
How many homes do you think you can really foreclose upon until you literally have trouble finding people to sell these houses to? Each one of those houses they foreclosed upon represents another person or couple who won’t be able to go into a bank the next time and finance a home. So not only did these predatory business practices put many people out of their homes, but it put those people out of the housing market. It’s the financial equivalent of killing your customers, thinking that you’ll prosper by stripping their corpses of valuables, only to eventually find that you’re beginning to run out of customers.
Personally, I don’t think these financial institutions should be bailed out by the Government. Let them fucking burn. If their predatory business practices has led them to total collapse, they’re only getting what they deserve for treating their customers like prey.