Aging: Depression lessons important todayI’ll bet this has been bothering you too. What happened? What caused the collapse of worldwide financial agencies?
By: Bernie Hughes, Superior Telegram
I’ll bet this has been bothering you too. What happened? What caused the collapse of worldwide financial agencies?
While we couldn’t find the necessary millions of dollars to provide health care for our citizens, congress has authorized Treasury Secretary Henry Paulson to spend billions of U.S. taxpayer dollars to attempt a rescue of free market mistakes.
My first reaction was to wonder why someone who was part of the problem — four years as head of Goldman Sachs — was being trusted to fix the problem he must have been aware of for a long time. Wasn’t this a fox in the hen house proposition? Or, on the other hand, it may take one to know one. As you can see, I don’t know; just thinking out loud.
I, first told myself that I, a financial pygmy, couldn’t have been expected to understand this discombobulated high finance issue. Having experienced the big depression in my boyhood, I’ve personally been extremely financially thrifty. More outspoken acquaintances might even have labeled me “tight.”
The big spenders, as I viewed it, should have had early warning about this many layered, complicated problem. How come experts employed in high finance institutions hadn’t blown the whistle prior to our present panic state thus causing official action to be taken much earlier when less damage would have been caused?
But, eventually it dawned on me that I had been rather unobtrusively aware of this problem for some time. I, and others I knew, had been receiving unsolicited credit cards in the mail frequently for some length of time and even heard of college pranksters obtaining one in their mascot dog’s name.
I was aware that people who didn’t pay their credit card bill on time were charged an interest fee and heard stories where that such fees were rising to unheard of rates of interest. Later it came to my attention that people were maxing out these credit cards and were using new ones to make payments on the maxed out one until they had another and in some case many others. So I, too, really should have been aware of the creditmania.
Now, of course is the $64 question, what should be done about it? One obvious need is increased government regulation of the “free” market. How soon we forget. The big depression brought about the Glass-Steagall Act in 1933. By 1999 those days were distant memories and our Senate Banking Committee dissolved that Act, which had prohibited banks, investment houses and insurance companies from combining into one corporation. That and/or other changes may need to be instigated to prevent another financial cold bath when our memories have grown dim.
In any case our economists, hopefully, will sort this all out and explain it to us. There have been many definitions of an economist. You can pick out the one that you think best fits our sad, sorrowful, situation today:
An economist is a person who figures out tomorrow why the things he predicted yesterday didn’t happen today. Economists tell us that the economy moves in cycles instead of running in circles. It may sound better but it seems to mean exactly the same thing to us peons.
Modern political theory seems to be that the best way to keep the economy in the pink is to keep the government in the red. Doing a real good job of it too.
One fellow said that the economy is as confusing as playing a cross-eyed Ping-Pong player. The stock market keeps going down and the supermarket prices keep going up.
One thing that I’ve decided on for certain. We could get along much better with fewer economists and more economizers. How about you? If not, we better learn.More from around the web