This episode deals with the tailspin of supply and demand. I had a different take on this episode, though. Actions that we take in life are never the real problem, they are only the symptom to a state of mind, myself included.
What you have are people playing in a foolish way on both sides of the fence.
The here-and-gone collectives that package the loans to sell are in it to make as much money as they can. They break countless rules in the process with no desire to build a long-term quality product. In a race against what other brands offer, they continually decline standards to meet the needs of a lowest common denominator.
Their existence, however, is determined by a demand. A demand by many people hoping to achieve what they understand as the “American Dream”. In many ways the idea of taking out a loan on a $300,000 house when they can’t afford to pay groceries is something that is programmed by what we are exposed to as a symbol of status. Excessive acquirement is something that is trained in a repetitive way, by continual exposure on a daily basis without alternative.
The alternative, unfortunately, is something that is more real to previous generations. It’s simple responsibility, living within your means, and realizing that the real value in life are the things we cannot acquire by monetary exchange. Not enough people listen to their grandparents or know how people survived BEFORE the days of no-doc loans. In an ironic and sad way, it’s as if the spending habits of government have trickled down to the individual.
If every person did their part, there would be no more demand for competing companies to offer a ridiculous financial product and the cycle would be broken. It starts and ends with us.
A special program about the housing crisis. We explain it all to you. What does the housing crisis have to do with the collapse of the investment bank Bear Stearns? Why did banks make half-million dollar loans to people without jobs or income? And why is everyone talking so much about the 1930s? It all comes back to the Giant Pool of Money.