Friday, February 06, 2009

The Sins of Our Fathers

Niall Ferguson, in his book, "The Assent of Money": "Every shock to the financial system must result in casualties."

We've had the (sub-prime) shock and the 2008/9 casualties are: the investor class is reeling (and reacted by freezing up credit). Home owners who got homes based on sub-prime loans are defaulting. And there is a business and employment recession.

The new administration is trying to lessen a spreading casualty rate of the recession/depression by asserting today that we must accept trillion dollar deficits for the foreseeable future: so that borrowed money can go to bailing out financial institutions, helping defaulting mortgagees with lower interest loans, and investing in infrastructure to create and save jobs.

A cynic's question: Is this stimulus package just more of the same thing that got us into this mess? Is the administration simply and erroneously postponing the inevitable (and proper) generational casualty effect caused by that generation's (and earlier generation's) financial mismanagement--one that that generation (and its greed) benefited from and caused; and should therefore now rightfully accept is their punishment and cost to bear (in a much more modest living style, for example)?

Or is this 'boomer' generation simply (and unfairly) passing their profligacy/casualty onto the next generations of their grandchildren and children, a conscious, willful and still greedy financial version of "The sins of the [debt-addicted] fathers are passed on to the sons" (rather than absorbed themselves)?

I thought we were 'hoping' for 'Obama-change'?


Post a Comment

<< Home