Thursday, September 18, 2008

The losing battle

Those of us that have read Ayn Rand are familiar with the term "looters". These are not the people who ransack businesses after natural disasters or riots. Instead they are the failing businesses that call on the government to save them from their deserved demise. These are the Bear Stearns, AIGs, Fannie & Freddies, Morgan Stanley, etc. They are taking your taxpayer money (really it is international debt), and padding their pockets so they can stay in existence as independent banks.

These companies haven't earned the right to continue as solvent entities. Instead they have bought and paid for the entire US government and convinced them to spend billions, if not trillions, of dollars to shore up their balance sheets. Readers of Atlas Shrugged would see the truth and a reenactment of current events written on all 1,000 pages of the novel.

Business is a Zero Sum game. For a business to create value, it must take that value from another business. Trading is no different. There are businesses that have made good loans and others that made bad loans but controlled their risk effectively. These are the businesses that should benefit from these banks poor decisions. These businesses would have risen to the forefront, with their risk controls and strong balance sheets to buy up assets at attractive rates of return. Instead the poor risk controllers will promise to make things better and not deliver. We will have more trouble fairly soon and they will ask for more money to bail them out. When will it ever stop?

So how will you stand up to the special interests that are screwing usover? I would suggest you sending a scathing letter to your elected representatives. Here's a link to your U.S. Senators and Representatives.


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