My worry
This financial crisis is just too immense for human intervention to make a difference. It's like spitting in the ocean. Every square inch of the western world is hideously overvalued and mortgaged to the hilt on those fictional values.
I visited one of those web sites with areal photgraphs and a program to indicate estimated house values. You run your cursor along the rows of houses and dollar figurs pop up. I went to neighborhoods I knew and it was sickening. Everything monstrously over valued. Houses I'd sold, I KNEW the numbers were lies. All lies. Lies lies lies!!!! The words ringing in my ears. I had to get out of the site. Did you know AIG has already used up that $85 billion loan and just got another $37 billion. I think banks and insuarnce companies may continue to fail whatever governments do. That may be the only way out of this, to reach equilibrium again. An epic blood letting across the west. Right now, we may be just pumping fresh blood into terminally ill companies, blighted by the virus, or even corpses. |
Like I said before--my brother's house in SLC, a piece of crap, next to a halfway house, smaller than my own piece of crap house. Doubled in value in one year.
Prices in some areas may need to come down dramatically. And that may take years. |
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Greenspan now rarely speaks anymore, since the crisis. But when he does he blames Wall Street greed for wrecking the market's magic. WHat happened to greed is good? |
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If growth is strong, unemployment low, and the CPI is under control, why put on the breaks? Should the Fed care about asset bubbles? Is the Fed going to determine the value of assets for every market? |
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Translation - "We should have regulated better" No wonder Greenspan is laying low. At least he didn't try to blame the whole thing on Barney Frank. |
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One of my partners just asked rhetorically whether economic libertarianism would go the way of socialism. In these times those aren't fighting words. |
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If it came down to even 5% less material wealth, who here wouldn't want better stability? |
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And trust me, these houses are not worth $400k. |
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