Any spare change?

So, I'm no financial expert, just a guy trying to do the right things. Like many people I have savings that rely on the health of the financial markets so I've been as concerned as the next bloke about the plummet of the numbers over the past few weeks. There's been a lot of talk about the sub-prime crisis, the broken financial system, government bailouts, looming recession, financial crisis, etc etc.


But let's be clear on one thing: this whole thing was caused by bad business practices. This is a crisis of greed.


A stable society places it's trust in the law, government, health, education and finance. If we act within the law we expect to live in relative freedom and safety, and we also expect that those who do not obey our laws are punished appropriately. We trust those whom we elect to represent our needs. If we are sick, we expect to be given competent and appropriate care. We expect to be educated without bias or propaganda. And, when we give our money to banks or to investment institutions, we trust that those bodies will temper their decisions and actions with objectivity and morality.

What we are seeing now is a betrayal of that trust in the banking system. In the U.S., the constant drive for financial growth-spurts and elephantine profits has resulted in a plague of sub-prime lending. In short, money was thrown at borrowers who were unlikely to pay it back.

And that is the root of the problem; very simple but requiring a complex fix.

When it became clear that this course of action would affect some executive bonuses, the banks tried to fix the problem by putting the financial equivalent of short skirts and lipstick on the debts and pimping them off to other banks and brokerages as attractive investment vehicles. Again, greed was the driving factor, making a quick buck out of the common man's misfortune.

But this was like putting a band aid on leprosy and, very quickly, these investments were dumped like the crack whores they were. Investors moved into commodities for safety, driving the prices of oil, grain and others through the roof. Banks reigned back on lending to each other and to businesses, which suffered or died, as did some major U.S. financial institutions. The rest of the financial world, being an active participant in the credit market orgy, felt the same pain as the money-men realised the mistakes they'd made.

But this orgy between the banks, this selfish, lazy, inbreeding has produced offspring.
What we have now is a six-fingered, buck-toothed, sloping-foreheaded financial system that has low intelligence, doesn't really understand what is going on and is easily swayed by outside suggestion.

Which brings me to the subject of George Bush.

It's interesting to consider that George's eight-year term has been bookended by two of the biggest crises the world has ever known. It started with 9/11 and ended with the near collapse of a financial system that, if it did go down, would take most of us with it like a suicide bomber.

Think of your pension, savings, mortgage, ability to borrow money. Think of how society would react if these things were suddenly lost.

It would be easy to blame George for this, last great exclamation mark on his presidency but it wouldn't be fair. This has a much more fundamental cause, that being our perpetual drive for growth, it being the fact that the very mechanics of our society are based on greed, on making more money than the other guy, on the mantra of EBITDA and on the paradox of the investor as being both served and screwed.

It would be nice to think that a better way could come out of all of this but it won't. The mother of all corrections will occur (helped along by those dumb taxpayer schmucks) and we'll all carry on, buying SUV's and MP3's, ignoring the third world and worrying about China (who, if you're American or European, you now owe a lot of money.)

I would worry about it more, but I'm going to play on my XBOX360.