Tuesday, March 27, 2007

Mortgage Fiasco

A lot of people are making a big brouhaha about the sub-prime mortgages but I frankly can't get worked up about it. Some people who should never have been buying a home or at least as much home are losing their homes. They took on more debt than their finances could allow. Mortgage companies made some obscenely risky loans, they are going out of business. As a result home prices are falling. Bummer but big woop. Home prices were way out of whack in the first place because people were spending beyond their means, now we are seeing a correction. For some this correction will be painful but that is their own fault.

I do fear "corrective" policy actions that are likely to ensue. There has been some talk already about bailing those who have defaulted on their mortgages with a government subsidized loan. That's a brilliant signal Washington can send to the public. Make boneheaded financial decisions without fear, the government will rape sensible taxpayers on your behalf.

Thursday, March 22, 2007

Best Monologue Ever...

Danny Devito in Other People's Money (ht: Newmark's Door):

This company is dead.

I didn't kill it. Don't blame me.

It was dead when I got here. It's too late for prayers. For even if the prayers were answered and a miracle occurred . . . and the yen did this and the dollar did that . . . and the infrastructure did the other thing, we would still be dead.

You know why?
Fiber optics. New technologies. Obsolescence.

We're dead, all right. We're just not broke.

And do you know the surest way to go broke? Keep getting an increasing share of a shrinking market. Down the tubes. Slow but sure.

You know, at one time there must have been dozens of companies making buggy whips. And I'll bet the last company around was the one that made the best goddamn buggy whip you ever saw.

Now, how would you have liked to have been a stockholder in that company?

You invested in a business, and this business is dead. Let's have the intelligence--let's have the decency--to sign the death certificate, collect the insurance, and invest in something with a future. "

But we can't," goes the prayer. "We can't, because we have a responsibility, a responsibility to our employees, to our community. What will happen to them?"

I got two words for that: who cares?

Care about them? Why? They didn't care about you. They sucked you dry. You have no responsibility to them. For the last ten years, this company bled your money.
Did this community ever say, "We know times are tough. We'll lower taxes, reduce water and sewer"? Check it out. You're paying twice what you did ten years ago.

And our devoted employees who have taken no increases for the past three years . . . are still making twice what they made ten years ago.

And our stock, one-sixth what it was ten years ago.

Who cares?

I'll tell you.

Me.

I'm not your best friend. I'm your only friend.

I don't make anything? I'm making you money. And lest we forget, that's the only reason any of you became stockholders in the first place. You want to make money. You don't care if they manufacture wire and cable, fried chicken, or grow tangerines! You wanna make money!

I'm the only friend you've got. I'm making you money. Take the money. Invest it somewhere else. Maybe . . . maybe you'll get lucky, and it'll be used productively. And if it is, you'll create new jobs and provide a service for the economy and, God forbid, even make a few bucks for yourselves.

Thursday, March 15, 2007

Wednesday, March 14, 2007

NCAA Tournament For Pedigrees Only

With tournament time approaching, and basically an entire month of always having a basketball game to watch, here is a good editorial about the sad state of the NCAA basketball tournament.

Thursday, March 08, 2007

Reading for Anti

There's a good op-ed over at the New York Times weighing the merits of minimum wage against the earned income tax credit.

Tuesday, March 06, 2007

BTW

Scooter Libby was convicted on four of the five charges brought against him.