Saturday, February 14, 2009

Take your money and run

What fool would willingly stay in the game when moral hazard becomes the modus operandi of the nation? If you are a saver, you are punished with zero interest rate. If you have reliably paid down your debt, your tax dollars now go to bailout those who could not or did not choose to do the same.

If you didn’t get your $40 coupon from the government to buy a TV converter, we will delay the digital conversion at the expense of local stations across the country because television is your right (and you need to keep watching those very important advertisements.) The government will bailout weak companies and individuals who made bad choices while taxing everyone who played by the old rules.

Our children go to schools supported only by those that pay their taxes, not by those who default and now qualify for a bailout from the government. These schools now face years of dire underfunding.

Why stay in this game?

Repeat after me...

Repeat this three times daily until it becomes easy:

“Most major U.S. Banks are insolvent.”

This fact is as plain as the notes in the annual reports if not the balance sheets. Why then do we continue the charade of treating the problem as one of liquidity? Billions, maybe trillions of dollars of our kids future earnings will go to pay for this game. Republicans and Democrats in Congress are fond of playing the “sound and fury” game when they drag bankers and corporate leaders before them. Yet we don’t see a leader stepping up to call the problem what it truly is. We have noted economists and editors of credible publications like the Financial Times and The Economist stating things clearly, but the masquerade continues over here.

Bring your pitchfork, I’ll supply the torches.

http://www.economist.com/finance/displaystory.cfm?story_id=13110352