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Nothing To Fear But Fearlessness Itself?
theodp writes "In a post last August, Robert X. Cringely voiced fears that Goldman Sachs and others were not so much evil as 'clueless about the implications of their work,' leaving it up to the government to fix any mess they leave behind. 'But what if government runs out of options,' worried Cringely. 'Our economic policy doesn't imagine it, nor does our foreign policy, because superpowers don't acknowledge weakness.' And now his fears are echoed in a WSJ opinion piece by Peggy Noonan titled 'We're Governed by Callous Children.' She writes, 'We are governed at all levels by America's luckiest children, sons and daughters of the abundance, and they call themselves optimists but they're not optimists — they're unimaginative. They don't have faith, they've just never been foreclosed on. They are stupid and they are callous, and they don't mind it when people become disheartened. They don't even notice.' With apologies to FDR, do we have nothing to fear but fearlessness itself?"
I think not.
Sure it is. Nerds like expensive toys. Expensive toys cost money. If our imperious leaders and Captains of industry take all our money away, nerds won't be able to afford their expensive toys.
The higher the technology, the sharper that two-edged sword.
Dammit you don't read anything do you.
I'll repost:
Second, many of the biggest flameouts in real estate have had nothing to do with subprime lending. WCI Communities, builder of highly amenitized condos in Florida (no subprime purchasers welcome there), filed for bankruptcy in August. Very few of the tens of thousands of now-surplus condominiums in Miami were conceived to be marketed to subprime borrowers, or minorities—unless you count rich Venezuelans and Colombians as minorities. The multiyear plague that has been documented in brilliant detail at IrvineHousingBlog is playing out in one of the least-subprime housing markets in the nation.
Third, lending money to poor people and minorities isn't inherently risky. There's plenty of evidence that in fact it's not that risky at all. That's what we've learned from several decades of microlending programs, at home and abroad, with their very high repayment rates. And as the New York Times recently reported, Nehemiah Homes, a long-running initiative to build homes and sell them to the working poor in subprime areas of New York's outer boroughs, has a repayment rate that lenders in Greenwich, Conn., would envy. In 27 years, there have been fewer than 10 defaults on the project's 3,900 homes. That's a rate of 0.25 percent.
On the other hand, lending money recklessly to obscenely rich white guys, such as Richard Fuld of Lehman Bros. or Jimmy Cayne of Bear Stearns, can be really risky. In fact, it's even more risky, since they have a lot more borrowing capacity. And here, again, it's difficult to imagine how Jimmy Carter could be responsible for the supremely poor decision-making seen in the financial system. I await the Krauthammer column in which he points out the specific provision of the Community Reinvestment Act that forced Bear Stearns to run with an absurd leverage ratio of 33 to 1, which instructed Bear Stearns hedge-fund managers to blow up hundreds of millions of their clients' money, and that required its septuagenarian CEO to play bridge while his company ran into trouble. Perhaps Neil Cavuto knows which CRA clause required Lehman Bros. to borrow hundreds of billions of dollars in short-term debt in the capital markets and then buy tens of billions of dollars of commercial real estate at the top of the market. I can't find it. Did AIG plunge into the credit-default-swaps business with abandon because Association of Community Organizations for Reform Now members picketed its offices? Please. How about the hundreds of billions of dollars of leveraged loans—loans banks committed to private-equity firms that wanted to conduct leveraged buyouts of retailers, restaurant companies, and industrial firms? Many of those are going bad now, too. Is that Bill Clinton's fault?
Look: There was a culture of stupid, reckless lending, of which Fannie Mae and Freddie Mac and the subprime lenders were an integral part. But the dumb-lending virus originated in Greenwich, Conn., midtown Manhattan, and Southern California, not Eastchester, Brownsville, and Washington, D.C. Investment banks created a demand for subprime loans because they saw it as a new asset class that they could dominate. They made subprime loans for the same reason they made other loans: They could get paid for making the loans, for turning them into securities, and for trading them—frequently using borrowed capital.
At Monday's hearing, Rep. John Mica, R-Fla., gamely tried to pin Lehman's demise on Fannie and Freddie. After comparing Lehman's small political contributions with Fannie and Freddie's much larger ones, Mica asked Fuld what role Fannie and Freddie's failure played in Lehman's demise. Fuld's response: "De minimis."
Lending money to poor people doesn't make you poor. Lending money poorly to rich people does.
Honestly, no, I don't think it's ridiculous for someone in the modern era, in a first world country, to expect health care in perpetuity.
This is seriously one of the most idiotically short-sighted and uninformed comments ever posted to Slashdot. It stands as a testament to why the West is doomed to failure, and completely deserves all the death panels and totalitarian government that is headed our way. I am in absolute awe of the fact that it has been modded up.
This is seriously one of the most idiotically short-sighted and uninformed comments ever posted to Slashdot. It stands as a testament to why the West is doomed to failure, and completely deserves all the death panels and totalitarian government that is headed our way. I am in absolute awe of the fact that it hasn't been modded up.