JustinSpeak

I think Peter Schiff is an idiot, but not because of his economic views. He is way more qualified to an advanced opinion of our current economic woes than I am. However, he is doing more harm than good with his constant negativity and crankiness. People need optimism to move forward and get things done. Going out on countless radio shows and trumpeting your prediction of the economic meltdown and constantly saying the worst is yet to come is simply irresponsible. Yes, he has been pretty accurate with a lot of what he says, but that doesn’t give him the green light to fear monger.

Peter Schiff’s Agenda

Watch some of his videos on youtube. The guy never has anything positive to stay! All he wants to do is scare people into buying into his firm, buying his books, and making commissions. If John McCain won the election, then he’d be barking up his tree too. If he was really interested in helping people out, he’d be proactive and positive, not scaring people to death.

Treat what he says with a grain of salt. He is no doubt a highly intelligent man and has some very interesting things to say about the current state of the world economy. However, his negativity does more damage than his economic advice can help. He’s riding high in the middle of his fifteen minutes. Ron Paul liked him, so the Digg community likes him. He made a spot on prediction of the housing collapse, so he’s got more attention there too. He’s a perfect guest for cable news shows since he’s so doom and gloom, so he’s got even more attention. Peter, use this new found opportunity to say something positive.

My dearest reader, these are crazy times indeed. I’ve been hearing a lot of ballyhoo about the credit default swaps and what they mean for the future of the financial system.  Well, after watching the following video from Marketplace, I have a much better idea of what is going on.  It is a long video, about ten minutes, but it will explain the thing for you in pretty simple English.

Enjoy.

Untangling credit default swaps from Marketplace on Vimeo.

So there we go. The current financial system allows for bets to be placed with nothing really backing up the person making the bet, and the people that have to pay up on the bet are set up in such a way that they have to bring other institutions down with them when the fit hits the shan. This is very similar to what went down in the housing market.  People could buy houses, with no money down, on risky adjustable rate mortgages with the assumption that they will hold on to the house only for a few years and then sell it for a profit.  If it works, the home buyer keeps the profits. If it does not work, then the lender basically has to take the fall. The bank could call the buyer and say, “You owe us money.” but if the buyer can’t pay it, then there really isn’t anything that can be done.

Essentially, you’ve got a situation where people could do whatever they want because the risk was, more or less, assumed by someone else. When you’re playing with the house’s money you don’t truly appreciate the repercussions when things go south. 

My advice? Spend less than you earn, and don’t get paralyzed by fear. Live your life with optimism and keep a cool head. Even if this financial crisis causes the world to descend into chaos, which is highly unlikely, cooler heads will eventually prevail.

I can count on two fingers how many times presidential candidates actually answer a question in these debates.  Okay, that’s a lie, I can’t count any examples at all. They are so skilled at taking a question, answering it for a split second, and then launching into the benefits of their platform.  Wouldn’t it be great if something like this happened?

Moderator: Who would you pick for your Secretary of Defense?

Candidate 1: Well, you have to pick someone who blah blah blah blah blah.

Candidate 2: General Wesley Clark

Moderator: What would you do about the Israel and Palestine fight?

Candidate 1: I would reach out to the International community to bring our allies together blah blah blah blah.

Candidate 2: I would press Israel to give them the land they want, respect their border, and get on with it.

Unfortunately for all of us, we’ll just get bullshitted over and over again. That being said, some politicians are better than others.  What you have to do, besides registering to vote and casting a ballot, is pick the person who is closest to your views.  You won’t find anyone perfect.  However, you will find someone who is the “least incompatible” with you.

Also, know that nothing in our political system will change overnight.  Everything has to be incremental. The radical candidates from Ross Perot to Ron Paul to Ralph Nader have brilliant ideas, but they are too much at once for our pea-brained country.  One step at a time.