Although I have my theories on how we've gotten to this point, I couldn't even begin to explain the complexity of the current economic crisis... So I had to do some research to back up my theories!
The Economic Crisis didn't get serious attention until September 2008, with the failure of several large Wall Street banks. Yet there were definitely signs prior to that... It mostly began with a mortgage crisis, following the end of 2007. This crisis was caused by a high rise in foreclosures, because people were unable to pay for their house loans. Why were people suddenly unable to pay for their houses? Its easy! They never had the money to begin with! They were victims of a corporate scheme to make more money! They were victims of Fannie Mae and Freddie Mac!
Lets take a step back further to FDR's "New Deal" days... One of his many programs to help a suffering economy, was to establish Fannie Mae which would make home mortgages more affordable to low-income families! This worked great for nearly 30 years, with the government controlling the company! Until some Business-minded politicians decided there was more money to be made! So why not De-Regulate these businesses, and let them run themselves. And to be fair, they decided to create Freddie Mac, so that Fannie Mae would not dominate the sector. Two companies with ultimate control over home mortgages!
Now to get back on what this all has to do with the current economic crisis, well here it is! The government wanted to increase home ownership so they encouraged Fannie Mae and Freddie Mac to lower their loaning standards... This meant more customers, more home ownership, and most importantly more money in the pockets of Fannie Mae and Freddie Mac! It would soon come to bite them in the ass, when they found that they were far too generous on giving out loans, and would result in the most foreclosures since the early days of the Depression!
Following this Mortgage Crisis, the government had to act, so they decided to once again take over Fannie Mae and Freddie Mac, like back in the old FDR days... Yet this quickly lead to panic on Wall Street, since these major banking and financing companies had large investments in these 2 mortgage companies! This fear and panic would eventually lead to a sharp drop in the stock market, along with bankrupting several finance companies such as Merrill Lynch, Lehman Brothers, AIG, Washington Mutual, Wachovia, etc!!
And thus would begin an economic chain reaction of FEAR, that would eventually spread over to Europe and Asia. As the stock market continued to decline, companies began downsizing by the thousands, in fear that they may not have sufficient funds to stay-afloat. The crisis also spread to other sectors such as the Automobile and Commercial sectors.
The government finally passed the highly debated Bailout-Bill, a 700 billion dollar proposal, to buy assets and bring capital back to these banks... I'm sure there are both sides to this, but i basically see it as money coming from the tax-payers to save rich bankers! Not to mention, none of these rich CEOS, actually went broke! Hell I even heard some walked away with bonuses... Tell me that's not messed up?
So after a transition of power and policy, the crisis continues and Obama finds himself knee-deep in the mess... One thing is for sure, Obama has the crisis to thank for being elected. Had it not happened at such an ideal time in the campaign, he may of not won by such a large margin!
Nonetheless, I know Obama is the right guy for the job! He has a whole different approach and mindset than the Free-Market Republicans. Unlike Bush, he believes in a more equal balance of wealth to stimulate the economy! Yet I Cannot put the blame entirely on Bush's administration... It's far too complex, and I know there are both sides to the problem! In the end I feel the best solution is More Government and More Regulation! We've given these private companies far too much power! They run and control the government, and are causing all the lower-middle class people to suffer! They are the reasons we are in this crisis. They have grown too greedy for wealth and power, and must be controlled! Hopefully in time, President Obama will mend this terrible mess!
One thing I've come to understand about this whole crisis, is the imensity of it! It goes beyond Wall Street or Washington DC, and has spread throughout the global economy like a virus that cannot be easily stopped. It is a on a destructive path, like a Forrest Fire, affecting all those near it! I know I myself am definitely feeling it's affects! Hopefully we can stop it before it gets worse!
Slumdog Millionaire is definitely worth seeing before the Oscars this Sunday! After watching it last night, I can understand why it has received so much hype! It did not disappoint like the overrated Benjamin Button did! It has an artistic approach to it, with a great story, amazing imagery, a spectacular soundtrack, and all around good acting! Oh and let me just add that Freida Pinto is an essential element in the movie! Her beauty is vividly captured in the backdrop of the poor slum-life of India, and she quite literally shines from the screen! It's all around good-stuff, full of suspense, romance, comedy, and drama. I would not be surprised if it won best picture of the year, although I still have to see the other contenders such as; The Wrestler, Milk, Frost/Nixon, Doubt, and The Reader... We shall see this Sunday!
