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TheGarcipian (41.36)

March 2008

Recs

13

VISA Verbulence

March 20, 2008 – Comments (7) | RELATED TICKERS: V

I'm coining a new word today: "verbulence".  [more]

Recs

9

Stimulus Shrimpulus

March 06, 2008 – Comments (3)

Back on the stimulus package thingy... what a stupid idea. Congress should be ashamed they passed this, and the President who signed it should have his hands tied, literally. As a TMF article pointed out recently, the problem is not the liquidity or availability of easy money. The problem is that the wrong sorts of people were getting these loans: zero down, faulty paperwork, no verifiable income, high Loan-To-Value ratios, high Debt-To-Equity ratios, high balloon payments after the teaser rates expired, all the worst financial machinations that come from an oversupply of money, not a shortage of it. So, if the banks continued doing what they've been doing, that will only make matters worse for the average consumer and eventually for our economy when Mr. Foreclosure comes a'knockin'.  If, on the other hand, the banks start tightening up their standards, following through on their paperwork and doing their due diligence (that avarice had blinded them from doing over the past 6-7 years), then it doesn't matter how much oversupply of money we have. Indeed, having an oversupply of money doesn't guarantee the banks will absorb any other's bad paper when, in reality, they might not even know how bad their own paper is.  [more]

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