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November 29, 2008

Credit Crisis

-- by Dave Johnson

When people, companies and municipalities reach a point where they have borrowed so much that they can't pay back the loans I really don't think the solution is to make more money available to lend. But that is what all of these bailouts are aiming to accomplish.

They say credit has "dried up" and banks "won't lend." Can you blame a bank for not wanting to lend money to someone who has no savings, huge credit card bills, and might lose their job at any moment? Can you blame a bank for not lending to a company whose customers have stopped buying and can't pay them what they already owe?

It's just more of the same old top-down thinking: that if you just give more and more money to the few at the top things will get better.

At what point does the obvious become obvious? When people are tapped out, they are t.a.p.p.e.d. o.u.t. That's it. No more blood can be squeezed from that stone. You can't make a person work longer hours when they are already working two jobs. You've already taken away pensions and health care and vacations and overtime, you can't take away even more.

Posted by Dave Johnson at November 29, 2008 11:36 AM


Comments

When will the thugs who are responsible for this crisis be finally arrested?
http://www.investopedia.com/terms/c/credit-crisis.asp?viewed=1

Posted by: Joe Plumber at December 17, 2008 10:24 AM

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