Certainly there are signs that the plight of ordinary, non-billionaire people is finally trickling up to Wall Street. (I’ve always thought that economic indicators trickle up, not down, but then, I’ve got a degree in French and Music, so what do I know?)
Specifically, the practice of predatory lending reached epic proportions in the heady days when Alan Greenspan lowered the federal interest rate to .5% to protect his boy Bush from the consequences of cutting taxes in a time of war. Mortgage companies, seeing that people could not afford to live where they wanted and needed to, took advantage of human greed and lack of education about financing, and approved them for mortgages that could not be paid after the balloon payment, or after the Fed raised interest rates for the umpteenth time to stave off inflation, or many other variations on the same theme.
Unfortunately, even greedier banks bought these “sub-prime” mortgages, and expected that the loans were reality-based. They weren’t, and the reverberations are being felt throughout the country.
From Raw Story:
Wal-Mart CEO H. Lee Scott Jr. says customers are “running out of money.”
Earlier this week, consumer juggernauts Home Depot and Wal-Mart reported softer than expected earnings.
In Los Angeles, economic concerns hit close to home.
Anxious customers of Countrywide Bank jammed its phone lines, branches and website after the nation’s largest mortgage lender — which owns the bank — announced it was facing problems from a credit meltdown.
“Countrywide Financial Corp., the biggest home-loan company in the nation, sought Thursday to assure depositors and the financial industry that both it and its bank were fiscally stable,” wrote the LA Times Friday. “And federal regulators said they weren’t alarmed by the volume of withdrawals from the bank.”
“The rush to withdraw money — by depositors that included a former Los Angeles Kings star hockey player and an executive of a rival home-loan company — came a day after fears arose that Countrywide Financial could file for bankruptcy protection because of a worsening credit crunch stemming from the sub-prime mortgage meltdown,” the paper continued.
“At Countrywide Bank offices, in a scene rare since the U.S. savings-and-loan crisis ended in the early ’90s, so many people showed up to take out some or all of their money that in some cases they had to leave their names,” the Times added. “Bill Ashmore drove his Porsche Cayenne to Countrywide’s Laguna Niguel office and waited half an hour to cash out $500,000, which he then wired to an account at Bank of America.”
“It’s because of the fear of the bankruptcy,” Ashmore, president of Irvine’s Impac Mortgage Holdings, which escaped bankruptcy itself recently by shutting down virtually all its lending and laying off hundreds of employees told the paper. “It’s got my wife totally freaked out. I just don’t want to deal with it. I don’t care about losing 90 days’ interest, I don’t care if it’s FDIC-insured — I just want it out.”
I believe that by the time the Presidential election rolls around, we will be drawing down our forces from Iraq already. Certainly the surge cannot continue at its present levels past April 2008 without serious risk of breaking the Army altogether. And we know that the House has already passed a bill that echoes that deadline, although it requires the troops to be almost completely gone from Iraq by then.
Even if Bush can hold the line until he leaves office, the American people know that every Democrat running has promised to get us out of that quagmire. So really, Iraq may not be the issue in 2008.
As for national security issues, Americans are already favoring Democrats over Republics. After all, 9/11 happened on Bush’s watch, and it’s quite obvious that his approach to keeping us safe – the Bush doctrine of pre-emptive war – is not working in any way, shape or form. Where’s Osama bin Laden again?
Yes, it seems very likely that the Clintonian wisdom of the 90’s will come into play once again in 2008, but this time with a twist. Maybe this time, Republics will vote their interests, instead of blindly following whomever shouts the loudest about God, Guns and Gays. Maybe America has woken up to the fact that Republics cannot be trusted with their money. And maybe we will finally realize that when we can’t put food on the table, when we’re working three jobs (“uniquely American!”) and never see our families, when we are losing our homes and our health due to unregulated corporate malfeasance and greed…then we cannot be a free society.
Maybe it really is…The Economy, Stupid.