I just watched CCTV 2.00pm news, and an event that could have slipped many people's memory was that which started the greatest financial meltdown in the United Sates since the 1920s -- that infamous day saw the more than 150=year-old LEHMAN BROTHERS being declared a bankrupt, unleashing a slew of more crises besetting the "Titanics" of American corporate sinkings that could not have entered therealms of possibility in any banker's mindscape until it happened. Today September 15 marked its second anniversary, and the US government resorted to a key feature well used by Malaysia's Dr Mahathir Mohamad, BIG BROTHER to the resucue with financial bailouts.
Yes, a blaiout announced within months of the collapse of LB amounting to US700billion, accompanied by two stimulus packages totalling US1trillion (NOTE: One trillion is 1 followed by 12 zeroes.) I can visualise that "famous" smirk ofn the former PM's face that is his trademark without the expressed "There,I am now vindicated!"
History will have to be the finalarbiter of Mahathir's many initiatives -- and Desi humbly suggests that there are potentially a dozen PhD theses to be won just based on Mahathirian Ecoomics -- will Petronas sponsor Desiderata woth USD1million for the next two years?
I "goggled" and randomly picked up a then relevant item now about two years old to put the topic in context, so here/hear!:)
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Lehman Brothers, Washington Mutual, the Bailout of Fannie Mae and Freddie Mac - Its Impact on You
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By successhub
It's a Huge Mistake to Take Lightly What is Happening in the United States Economy
The potential failures of such companies as Lehman Brothers and Washington Mutual are in the financial headlines this week. The bailout of Fannie Mae and Freddie Mac is now official. This is the most massive federal bailout in history.
I think that few people in this country understand how dire the situation is with the U.S. economy today. The total of our government's current liability and unfunded entitlement programs is more than $53 trillion. This equates to more than $450,000 per American household.
A few weeks ago I wrote an article on the Fannie Mae and Freddie Mac bailout. If anything, I probably understated the gravity of the situation. In the article, I spoke of the hyper-inflation we will experience over the next several years because of this bailout. This will hurt us all, but especially those who are approaching retirement age or who have already retired.
I feel that the U.S. economy is currently in a recession despite what our government officials say. I feel that we are in for a long period of sluggish growth at best. We will not come out of this mess for a long time.
What Does This Mean for You?
In addition to a long period of significant inflation, it will most likely cause major problems for many of our country's corporations. Business will be slow resulting in massive lay-offs for many good people. In the past, companies have targeted higher paid employees, especially those in their 50s and 60s for these lay-offs. New jobs will be hard to find. Our federal taxes will most likely increase.
I don't want to sound like an alarmist. I think that most people feel that everything will be ok now that the government has moved in and bailed out Fannie Mae and Freddie Mac. Nothing could be further from the truth. Instead, this will cause major problems for our government, for us, our children, and our grandchildren.
Who is to Blame for the Mess We are in?
Who is to blame for the financial problems related to the mortgage meltdown, Bear Stearns, Fannie Mae, Freddie Mac, Lehman Brothers, AIG and Washington Mutual. The blame is placed on the abnormally low interest rates and massive credit availability instituted by Alan Greenspan and the Federal Reserve.
Blame should be placed on regulators who are responsible for overseeing the mortgage industry and the use of derivatives.
Blame should also be placed on President Bush and all of Congress, both Republicans and Democrats. They should have known what was happening and apparently chose to ignore it since it resulted in growth in the economy. On the other hand, if they didn't understand what was happening, that's pretty scary. Several years ago, people I work with were already talking about the serious consequences of the Fed's actions.
Blame also falls on the greed factor - those who loaned the money for home purchases and those who borrowed it. This includes banks, mortgage companies, and other credit institutions who recklessly loaned money to borrowers who could not afford the homes they were buying.
The greed factor also relates to home buyers. Many knew what they were doing and were in it just to make money as home prices appreciated.
Others didn't know what they were doing. Their emotions of joy and excitement of owning a home or a larger home overwhelmed their responsibility to do their due diligence - to evaluate the pros and cons of making such a large purchase.
I do feel somewhat sorry for that group of people. At the same time, I think that this is a lesson for everyone. We just cannot take lightly a purchase of this magnitude, certainly the purchase of a house.
Who Will Pay for the Greed of the Risk Takers?
What really makes me upset is that the federal government is trying to bail out many of these risk takers. This is sending the wrong message to U.S. citizens and is completely unfair.
Who is going to pay for all of this bailout? It is you and I. We didn't go out and buy homes beyond our means. We may have been tempted but logic prevailed.
You're probably like me. I hate seeing the value of my home go down. But when home prices reach a bottom, the prices of our homes will still probably be far higher than when this price appreciation began.
Many areas of our country did not participate in this home price appreciation event. But yet they suffer from the greed and stupid decisions made by credit institutions and borrowers in other parts of the country. They will experience inflation, higher taxes, and a slow economy like everyone else.
Here is the Action You Should Take
As I stated in my original article on the Fannie Mae and Freddie Mac bailout, you can't take lightly what is happening in the U.S. economy. Many other countries will also be feeling the effect of this.
Don't just sit back and expect that everything will be ok. I strongly urge you to evaluate your current financial situation and consider the alternatives you have. If you are planning to retire, consider staying on with your company or finding another job. I have found the best way to supplement retirement income is by choosing the best network marketing business.
I wish you the very best.
Scott Hubbard has retired from 25 years as a Chief Financial Officer in Corporate America. He now enjoys teaching corporate professionals and network marketers how to apply attraction marketing online and how to generate free qualified MLM leads on the internet.
He is happy to give a free consultation for those having a serious interest in being an entrepreneur. You can reach him toll-free at 877-878-4036 or by email at Scott.Hubbard3@gmail.com. You can learn more about Scott by going to his blog at http://www.YourGuideToRetirement.com.
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