I have yet to hear anyone address the root cause for our recession. Maybe the following will explain why we have arrived at this moment in our history.
Greed is a nasty five letter word; more filthy than any four letter word. But what is greed? I believe it is taking something that is not yours and failing to reimburse. Before we can solve the economic dilemma we must understand the root cause. Greed is the cause of the financial tsunami. We must not blame Wall Street entirely. We must not blame Main Street entirely. The blame begins on our street. Each of us in a small way caused the recession. Each of us at some time or another has taken something and gave nothing in return. President Lyndon B. Johnson signed a bill that gave the indigent an opportunity to purchase a home. This bill was well-intended. It wasn’t the law that caused a problem; it was the abuse of the law that was the inception of the recession. Some people began to purchase a home they could not afford. That is greed. Some realtors sold homes to folk who knew they could not afford. That is greed. Some bank and mortgage companies went along with this idea and loaned the money to some who could not afford the payments. That is greed. Many bankers and lenders began to loan more than the value of the property, hoping inflation would take care of the difference. That is greed. The rating agency was tainted. That is greed. Most firms on Wall Street got the creative idea of packaging these loans as derivatives and selling them as a security. That is greed. Many Wall Street firms sold these securities to pension fund managers and large investors and guaranteed them. That is greed. Many Wall Street firms set up a sham company that would insure the securities. That is greed. These Wall Street firms could not call this sham company an insurance company because it would have to be regulated. That is greed. The loans began to default at such a rapid pace, many firms on Wall Street could not honor their guarantee. This financial tsunami will continue until someone says, “Enough is enough!” Let’s begin the next generation of investments with The Golden Rule as the foundation stone of our financial system.
