Monday, August 13, 2007

Subprime and Greed

What were they thinking?

Where were the heads of the lenders who were making huge mortgage loans to unqualified buyers under the clever marketing tool of creative financing? While they pocketed big bucks, I watched interviews (this was several years ago) with consumers who were nonchalant about what would happen when they needed to pay more than a minimum amount of interest when required to pick up the loan principal that waited in the trap around the corner. Most of them, when asked how they'd be able to pull this off, replied they didn't think they would be able to pull it off. But in the meantime, they'd live the rich and famous lifestyle and Peter take the hind. Only a few of them didn't appear to understand what was ahead for them - contrary to what GWB claims.

So now. The subprime companies who invented this bubble of ignorance and greed are being bailed out by the Feds - yes the taxpayers' Feds - much like the clean up after the S&L fallout.

Where were they? Those people concerned with their own bucks? Those people with no concern for those who would end up picking up the pieces? If I could see this, why couldn't the smart heads, the leaders, the professed economical advisers see the obvious?

If the money changers saw the outcome and continued to stay the course, what does that say about leaders and business people?

1 comment:

Leonard Blumfeld said...

Great post - right on!