Los Angeles, California - Just like deregulation of the utilities, so Enron could capitalize on lack of government oversight without producing anything except a clever underhanded way to turn a quick buck instead of providing a real service people could use in a capitalist economy. Now liquidity shortages are being blamed solely on unethical mortgage brokers using questionable practices. But what of the shepherd who tends the scapegoat herd?
With all the near free money that was spewing out of the Federal Reserve a couple of years back, what less could one expect? All that near free money appealed to the lesser demons and not so much to the greater angels in every human being.
However, if we are to believe the President and the media, then I guess Americans were too impoverish to realize the American dream of providing shelter for their family. Particularly when they had the misfortune to buy a house from a real estate speculator flipping houses (buy high, sell even higher) for quick profit and then had it financed with an unethical mortgage broker trying to win the company bonus, a vacation in Cancun, Mexico.
Whatever the motive, it was fine with the government so long as it broaden the property tax base without having to raise taxes. At least that was the plan. Only with foreclosures up now, it is more then just the uneducated Americans too impoverished to afford a home that were exploited by real estate speculators and unethical mortgage brokers that are now losing homes. It is the highly educated real estate speculators and unethical mortgage brokers too, though not personally, of course.
Now Uncle Sam's dreams of a broaden property tax base without having to raise taxes used to make next years budget projections are long gone too. As soon will be many of the social welfare programs like public school funding, libraries and road and bridge repair - whatever happen to that?
A couple of years back some economists predicted it would either be real estate or the dollar that had to be sacrificed, but now both?
And what's the Federal Reserve to do? What else, pour out more money? Only this time not so much and nearly not so free as before as the frightening specter of inflation raises its ugly head on the horizon just in time for Halloween.
Lets just hope it does not linger 'till late November and scare away all the Christmas shoppers like the ghosts that visited old Scrooge, or the merchants will be experiencing a liquidity shortage of their own as well and then we will all be trading in Euros for sure.
