A Legacy of Debt

The other day I was explaining the national debt to my children. I used the round figure of thirty thousand dollars for each U.S. citizen and explained that each of them had that figure hanging over their heads. I had to stop when my eight year old nearly came to tears.*


What was sadder and more poignant that that, however, was my oldest son's response (who is just starting to work and earn money). With bravery and confidence he announced that he thought he could pay his portion off. That tore at my heart even more than the younger one's fear.

* My wife and I often cackle over how many wonderful stories our kids will have of our soul-damaging parenting.

Great Depression Flashbacks

I find myself groping for memories of my grandparents' memories these days. As a child, they would sometimes let drop an anecdote about hard times, but I didn't pay much attention. This article is a good refresher.

Rearview Mirror Fun

Please watch this entire clip, and then read the rest of this post. It's starts out kind of boring, but gets livelier.






For those of you not paying attention to the financial news, at least two of the companies recommended by the Pollyanna's have stock prices of zero.


My purpose in posting this video is not to pump up Schiff. At any given time there are thousands of Cassandra's running around screeching their own version of doomsday. A few are always bound to be right.


I sent this to a friend, and he had an insightful comment, which I want to underline. Hindsight is great, and can even provide a few rueful chuckles, as in this case. But what would have been our contemporaneous reaction? Would we have paid attention to Schiff? Would we have been swayed by the dismissive scorn of Schiff's critics?

TAL Does the Mortgage Mess

One of the best treatments of the financial disaster I've seen or heard, done by This American Life. The transcript is here (warning: long pdf).

When my cousin in the mortgage business told me a couple of years ago that if an applicant could fog a mirror with their breath, they got a loan. Turns out, he was describing the older, stricter standard:

Then the next one, came along, and it was no income, verified assets. So you don't have to tell the people what you do for a living. You don’t have to tell the people what you do for work. All you have to do is state you have a certain amount of money in your bank account. And then, the next one, is just no income, no asset. You don't have to state anything. Just have to have a credit score and a pulse. Actually that pulse thing. Also optional. Like the case in Ohio where 23 dead people were approved for mortgages.

Here's where I reveal my inner scrooge. Everyone wants to rant about Wall Street villains and congressional malfeasance. Yeah, they deserve every bit of it. But what about the people who took those loans? They were getting something for nothing. And losing their houses? Let's rewind the tape and play it back by the old rules. Under that scenario, they would never have had a house to lose in the first place. My fingers are going to get tired from all the pointing.