no.67 - Debt

Choosing debt is an act of optimism I cannot share. To put something on a credit card today in the hope that the money will turn up next week... well, it just reminds me of Wimpy from the Popeye cartoons, blinded by his aching desire for a hamburger. He truly would pay you back if he could, but where does he think the money is going to come from?

The problem, of course, is when debt dose not seem like a choice, such as when there is no other way to find a home. Shelter is hardly the same as a fleeting desire for a big screen television or a triple cheeseburger.

Ten days after my wife and I bought our home with a mortgage, our loan was sold to another company who began to bombard us with letters. They wanted to let us know we could borrow even more money. We could, they said. We should! They even sent us three and five thousand dollar checks and told us to go cash them. Have fun! Live it up!! They did not mention that the checks were actually little contracts which would shackle us us to absurd high interest loans and crippling debt.

Where did they think our money was going to come from? Did someone tell them I had started pooping five dollar bills?

When it comes to loans, I can never shake from my head the image of an organized crime family. I don't see much difference in their practices, except that the mafia is more clear about the terms.

I had to ask my mortgage company to stop sending these "offers", explaining that if I found myself in need of money, it would only be because I needed it to pay the mortgage.

These, of course, were not the most damaging of their programs. Lending money to people they knew drown under inflating interest rates was the most damaging. You could ask what they were thinking, but what they were thinking was "more." They figured that either your loan would be three companies down the road by the time you defaulted, or that they could throw enough money into betting against the poor suckers who got in over their heads, that they would make money no matter how thing shook out.

(Again, the mafia comes out with more scruples on this one. If Tony found out Joey Smudgepants couldn't pay his loan, he'd break a kneecap or take the guys car, but we wouldn't pass the problem off, or bet Uncle Junior that the guy wasn't going to pay up.)

What they didn't count on - what the greedy never really count on - is that they could lose this game of roulette. It turns out that they did not have a system in place for what happens a giant, bloated, financial institution is so overextended it needs to default too. Whoops. Now none of the banks trust each other, which is probably the wise choice, but terrible for the way they've lined up our economy.

Now it appears the murky 700 billion dollar plan to fix this mess isn't enough to keep everyone from panicking and selling their stocks.

But lest you should feel badly for those who are responsible for tanking the entire world economy, you can rest easy. The same greedy assholes who got us into the mess were the first ones to dump their stocks. Remember: that money is hemorrhaging from the stock market, but it is going into someone's pocket. You're 401K manager, on the other hand, may have been a little slower to act.