Such as:
China is in more trouble than we are (they own most of our national debt, and Hong Kong is all
with Wall Street), and, there is a major problem for everyone. Trickle down economics is absolute bs, it all trickles up. Let me explain.
The general wealth of a country is its GDP, which by and large is generated by the working class. Te working class in America (which includes the rapidly shrinking middle class) is the largest consumer of goods worldwide. Our luxury loving populace powers the economies of most of the third world, Japan, China and pretty much any body who exports their goods here. Thanks to the massive tax breaks given to corporations who outsource their jobs, the American worker has become an unworthwile investment, leading to the stagnation of pay and benefits. Thanks to the way our culture thinks, having your own home is the largest indicator of economic success, you have a place to call your own, you have something you can borrow against in hard times, and when your children finish college getting a degree for a job that no longer exists, they can get their old room back. So, when the bank suddenly decides that you are now qualified for a loan to get a house, you jump on it faster than a New York governor and a hooker. The price of your home becomes overinflated, the banks pretty much force people to refinance at the higher rates, and now you can still make the payments, barely, pretty much zero of your paycheck goes to the bank, and if you are in pretty much any state that doesn't swing blue, joining a union is out of the question. Now come in speculators driving the price of gas up to over for dollars a gallon, food prices rising, a national debt that makes your money worth less and less.
You Europeans may be wondering 4$ a gallon so what? But remember that most Americans
have to drive more than twice in a day that you do in a month, and there are a hell of a lot more of us. Suddenly, people have to choose between food and work or losing their house. Since you can;t work if you can't eat, and you can't keep a house without a job, millions of homes are foreclosed on. Foreclosure costs the banks a hell of a lot of cash. Now come the fun part. The people you financed with sold your loans to investments banks, packaged up with a lot of other homes and sold as a security. Suddenly, they need some cash to conduct day to day business. This is quite common in the financial markets, as you can have trillions tied up in very profitable collateral, but they only pay off at certain times of the year.
You (the financial bank) pay back the loans when the money comes in, and keep a hefty profit for yourself. But your credit rating is now pretty much 0 because of your shitty securities that you own, and nobody will lend you any money or buy the craptastic properties from you. The market smells blood. Turns out the Republicans took the ban of off short selling stock. Suddenly, every floor trader and day trader worth their salt is shorting the stock because they know they will make a lot of cash, and they don't care that this will drive you bankrupt because they're making money [I[god damnit[/I] so let the system collapse. Suddenly, insurance firms like AIG and mother-fucking bull balled Merryl Lynch are going down the drain and nobody wants to lend any money to anybody.
There is no more credit.
At all.
The crisis wasn't because major firms were losing money, it was because all the credit lines dried up faster than Cindy Mcain's
<cough> when John comes to bed.
Every single damn business in America operates off of the credit system. All of them, every single damn one. You cut off the credit flow in the fucking great depression again in less than a month, and pretty much every other industrialized nation (save New Zealand, go figure) is pulled into the black hole of credit crisis. Inflation skyrockets, and the US starts to resemble Somalia, only the warring tribes have less trouble telling each other apart, as people fight for food and jobs. Okay that was an exaggeration, but still, the vast majority of Americans will lose their jobs and be forced onto the streets. The American worker drives the economy. The largest consumer of goods (25% last I checked) has suddenly gone on welfare.
So, because of lenders who didn't give a damn, companies devaluing our workforce and Washington deregulating the markets (cause the twenties were so much fucking fun I guess), we are all one poorly made decision from global depression.
But hey, War's are good for the economy (if your the US anyway) and Russia keeps fucking around with Georgia... next stop WWIII. Lets all get on the Doomtrain. Whoo-Whoo.
Tl;dr Strife is full of it.
And we should all move to New Zealand cause it has mountains, oceans, sheep and seems like a nice place to watch it all come crashing down from.
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Topic: AIG(and WaMu) is DOWN (Read 9852 times)