I’ve said it before and I’ll say it again…
What a bunch of dicks.
As the world financial crisis begins to tighten its grip around the scrotums of even the most sequestered of bankers and financiers, one can’t help thinking – where did it all go wrong…..?
Now, I’m no banker, I’m a teacher. I do, however, have some banking skills. I am able to use a bank successfully. My pay is placed in there by my employer and I then have access to it on pretty much a daily basis. I use my credit card for daily purchases so that I may take advantage of the banks generous rewards system. Rarely, if ever do I have cash floating around in my wallet. I am never in overdraft (well, not any more anyway), so the bank is paying me to hold on to my money. That’s how I roll (at some point Mrs. Boon has a say in all of this as we have a joint account).
If I want to lend money to someone, say a friend, I make sure that friend is – as we say in our circles – good for it. If he or she isn’t, or I know that they may not pay me back, due in part to previous borrowing experience for example, I tend not to lend them the cash. It’s easier on our relationship that way. If friends don’t pay you back it can become awkward. As I have said I am not a banker, I’m a teacher – but even I know that you don’t lend to people whose ability to pay me back might be slightly questionable.
And now let us move, with a financial metaphor, to the cash strapped bowels of the international financial markets. So what’s happened? In short, this is all summed up by greedy, greedy Sir Alan Stamford who ALLEGEDLY has swiped an undisclosed number of billions from various people in the southern US and West Indies. And Bernard Manhoff (see previous blog) who is ACCUSED of ALLEGEDLY doing the same thing… Please do not removed the capitalised words from those sentences, because if you do, the sentences might have the slightest chiming of a bit of truth to them. And, for the sake of any litigious types out there, please ignore the last sentence.
Ultimately these two dickheads are the ones who got caught. I would say that due to the fact the United States of America has some kind of need to let the market provide everything, and then refuse point blank to put any regulations or rules in so that the market is guided in its operations, why are people so surprised that this has all happened.
This most basic of human emotions has affected economies worldwide over the past 18 months / two years. And the point has to, HAS TO be made. If you let greedy people who want to make as much money as they possibly can, that making money is the only thing that makes their lives worthwhile, if you give them a system to operate in that has no rules, regulations or authorities making sure that everything goes OK then you are definitely going to have a case of Collapsae Fantastico.
Bankers thought by lending to people who wouldn’t normally get loans they would be able to make huge amounts of money. Why didn’t they keep lending to people who COULD afford it? Because it wasn’t lucrative enough…
Can we really blame the heads of the banking system? Not really. As the British government found out recently during a select committee hearing, none of the chief execs of the major 4 banks (some of whom are now owned by the UK taxpayer) had any banking qualifications of any note whatsoever. How can we blame them if they weren’t qualified to make the decisions in the first place. Banks are public companies – public companies with shareholders. The shareholders demand returns on their investment. Decisions are made in the boardroom to reflect the demands of the shareholders. If this didn’t happen then nobody would by shares in that company and it would be worthless.
It comes down to the fact that Western Civilisation loves to take – and Eastern Civilisation thinks it’s right and are following our lead. We love me. It’s all about me. I’m the one. I’m the one that matters. It’s me, me, ME! As soon as you stop thinking about me and switch on the altruistic gene that’s somewhere deep in the subconscious, then failed banking decisions will not take place. This is a gross generalisation of course, but generalisations sometimes ring true…
My point is that for too long the human race, led by the capitalist notions of the Reagan and Thatcher, have created a market system that is flawed ultimately unsustainable. It doesn’t work. This has been proven. If the taxpayer is going to own all the banks in the US and the UK now (NZ banks are fine – they only lent to people who could pay loans back), then surely the governments are going to have a much bigger say in what goes on in the financial markets. Hopefully what has happened over the past 30 years is far less likely to happen again.
But what do I know, I’m just a teacher. Bankers know much more about the financial system and which people to lend to than I do.