President Obama touted a new foundation for growth in his 100 day press conference. He blamed an economy built on sand for our current economic condition. Those were good analogies, courtesy of his speech writer. However, upon even distant observation, it’s obvious to anyone with an ounce of common sense, that the continued individual home owner bailouts, $75 billion at last count, are nothing more than adding more sand to the pile.
Can someone, anyone, please explain to me, how artificially supporting home prices will truly, in the long run, do anything to relieve the economic conditions which grip this country? Reworked mortgages are still failing nationwide. Banks are still holding billions, perhaps a trillion dollars worth of toxic paper that rides on top of hundreds of thousands of bad mortgages. It was a set of artificial conditions which got us in this mess and more artificial "fixes" will only prolong this mess as well as drive up the cost of fixing it. Einstein defined insanity as "doing the same thing over and over again and expecting different results".
The very best short term case is that this mortgage bailout plan supports prices for a short time and stalls our economic slide. It may even stall the slide long enough to get President Obama reelected. That’s the best case, with probably the poorest possible outcome as the slide at the end of any artificial stall will be far more precipitous than we are currently experiencing. In short, its good for him and bad for us. This is what we get, because we have allowed our politician's focus to become staying in office, rather than best serving the people.
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