I would like to start by first congratulating the group on a terrific presentation of this book. I can image how difficult it must have been to deal with this material, but you three did a wonderful job of combining it all into one solid, comprehendible, presentation. It is going to be a tough act to follow!!
The part of this book that really struck me as interesting was how no one saw this coming in time to do something about it. I find that so hard to believe! I said this during the presentation, but looking back at it now, it seems to be such poor decision making on behalf of so many people. From the investors and big bankers all the way down to the home buyer. The concept of a sub-prime loan is one that I feel no one would have felt was safe from the beginning. I can't help but question a person who makes $90,000 a year deciding to buy a house worth over $300,000. I would never consider buying a house worth that much when making so little, despite what the banks told me. To me, I see this as handing the keys to a Ferrari over to a 16 year old boy, something bad is going to come of it. The fact that no one predicted this is hard to believe. I have always thought, and maybe its sheer ignorance, that we had officials within the government and working with the president who are professional economist. Economist that have PhD's and what not, who study nothing but the state of the economy and think of ways to improve it. How could they let something like this build for over 20 years?
My only conclusion is that everyone turned a blind eye to the problem. They swept it under the rug until eventually someone tripped. Unfortunately, it was a huge fall and it took the entire country down with it. Supposedly the country is out of the recession that was caused by this crisis, however, I still have relatives and friends who are foreclosing on their houses. I do not see this ending anytime soon. Now that I am entering the job market, and into the professional world, I hope that we don't make similar mistakes like this again......but we will.
Brandon,
ReplyDeleteI think that you bring up an important, yet unfortunate point. That point is that we will most likely make similar mistakes in the future. Although this thought is almost hard to stomach, it's probably true. However, I optimistically believe that, as teachers, we can actually play a role in preventing similar future mistakes as seen in this recent financial crisis. A lot of what caused the crisis seems to have been much naiveté by ordinary people. You and I could say that we would never buy a house we can’t afford. However, we’re more privy to government and economic procedures. Frankly, most of middle America isn’t, and they could be more prone to naïve and ignorant mistakes. Let’s try to change this fact as teachers and make our students more aware of modern political and economic systems and institutions and their responsible personal role in each!
Very interesting. I think a lot of politicians listen more to Wall Street types than to economists, unfortunately. For example, Paul Krugman (NY Times columnist and Nobel Prize in economics) has been writing about this for years. Wall Street can contribute more money to campaigns, I guess.
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