As much of a fan of politics as I am, I tend to choose opting out of discussing it. Why? Because politics is something that not everyone can agree on and I rather not deal with having sour relations with people I love from now until election day. Rather than talk about whether Obama is better than McCain or Biden is better than Palin, or vice versa, the most important issue currently at hand is the state of our economy and the financial impact we have around the world.
They say that one is only as strong as the weakest player on a team. When we talk banking and investing, the United States is not just one team and the rest of the world is divided up into other teams, the entire world including the US is ONE team. Why do I say that? Because any investment bank that has any relations with the dollar, or ties to a US banking firm, or has dealt with US investments overseas, has basically been taking nosedives into bankruptcy for the past few months. Things are especially worse right now after a historic 778 point drop in Wall Street and many people are out of the job.
A lot of the large investment banks have closed and a lot of people have lost their jobs, not just in the US, but also in other parts of the world like England, and even Switzerland is starting to have trouble with the Swiss banks. Tens of thousands (and probably now hundreds of thousands) of people are being laid off and not very many places are hiring people at the moment. People have less money and even less faith in the financial system. Everyone is affected, and not one day goes by that I haven't cracked open the newspaper and found even the slightest shred of good news. I wish this bad spell would just be over. I know we can overcome this trial, but it's going to take a LONG time.
Just yesterday, the Hong Kong news showed people sleeping on the streets of Portland, Oregon because so many are jobless and now also homeless as well right now. The funny thing though is that those camping out in Portland are not Oregonians. The campers are from California or Washington. Because it is illegial to sleep on the streets in both of those states, these jobless nomads have traveled to middle ground Oregon and decided to sleep there. The citizens of Portland are not happy about this and want something done about it, but we've yet to learn more about it.
Also, on another note, something for people who bank at these banks to know... Bank of America Corp, JPMorgan Chase & Wells, and Citigroup Inc., are now known as the Big Three. This means they have bought just about every failing bank in our financial system and all together make up 1/3 of the investment banking industry -- perhaps it's just overall banking industry. For those who are wondering, "Well, how does this affect me if I am with BoA, etc.?", the answer is quite simple. You should expect LOTS of changes in banking policy, in fees, and less sympathy. When a bank shoulders a lot of debt, it will use any method to get themselves out of the red. I can see these three banks charging more for overdrawals, for bouncing checks, and other penalty fees, etc., so I suggest that everyone stays on their toes when banking from now on.
As for the bailout plan that was passed in Congress... Yes, it blows, but suck it up 'cause if it doesn't pass we're all doomed to die. If we don't pass it, we die, if we pass it, we equally die, but at least we are doing something about saving the economy. And no, I'm not fond of the idea of paying out thousands of dollars in taxes per year for the next thirty years of my (what can very really miserable) life, but because of the way this country is constructed and because the rest of the world is counting on us to do something, we have to just bite the bullet and do this.
I agree, it is very unfair that we taxpayers have to pay for the mistakes of the gamblers on Wall Street. I mean, what these people have done with the housing market and stock investing is no different than walking into a casino and losing all your money. When you go to a casino and lose everything, do they give you money at the end of the day? No, they don't. So why should the taxpayers have to do anything to save the asses of these investment losers? They are the ones who are at fault and they are the ones who have crashed our system, so shouldn't they be the ones to fix it?
Well, that is not going to happen because our government supports Corporate America. The very reason why capitalism even exists is because of the way we have been taught to invest our money. Many Americans do not have savings, the concept is quite foreign to them. We have all been taught that if we have money, we should invest in stocks because that is where we can make MORE money. By investing in the right companies, we can make huge profits. By investing in any company, those businesses have the opportunity to utilize our money for expansion, which leads to them putting money back into our pockets. This is how we have been taught. We need to give businesses more money so they can use it to generate more value and wealth.
Basically speaking, we have been taught to live in a credit and debt-inflicted world. By giving our money to businesses, the companies owe us shareholders, so they are technically indebted to us. When we buy our houses, furniture, cars, etc., we pay on credit and gradually make payments with interest until we can pay everything off. So now that when banks don't have any more money left to lend people, and mortgage securities are totally weighing us down, and Wall Street is taking nosedives to hell, everything we have been taught until now is no longer going to help us, but rather hurt us.
When all's fails, I suggest going back to basics. Use cash and invest in savings (credit unions are great places to go). Before cellphones, fancy personal computers, iPods, and XBox 360's, we led much simpler lives. When businesses could be started with just $1000 dollars on hand and not all the paperwork we are required to fill out now, we used to do things in what we call "the old fashioned way." Life was so much simpler then because our methods ensured basic survival. So, one of the ways we can help ourselves now is to use cash when we go out shopping. Lose the plastic and bring out the greenbacks, then throw all the change into a jar that you don't touch until vacation time or it's all full. In times of dire straints, we have no one but ourselves to count on and if we do not lose the urge to pay everything on credit, we cannot (and should not be able to) whine about not having money later. You dig your own grave, so don't you DARE complain about it.
As a final word, the future of our economy looks quite bleak, but we'll be able to crawl out of this black hole eventually... just probably not now. And whoever is elected to be president this coming November, will probably do their utmost to solve our issues, but they probably won't get the job done in four years. When that happens, please remember that we're all human and we all tend to be stupid on so very many occasions, so please remember to give a fair evaluation of the work our future president's done when the time comes.
I feel that what happens in November and the next four years is partially by our hands as US citizens, so we should remember not to place all the blame on the White House if the next president also proves to be incompetent. Did we or did we not elect them to be there? So if they fail, the credit is given much to us as it is to them. With that said, I can only hope for the best and good luck to everyone. We all need a little of it.
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