Sometimes I wonder.
Oh, I know some that aren’t dumb. My Dad isn’t dumb, for instance. Sure, he advocates crazy policies that have no chance of anything but spectacular civilization ruining failure, but he isn’t dumb about it.
Monique Stuart, a blogger from DC, isn’t dumb either. She seems quite astute actually. After hearing Lindsay Graham (Idiot-SC) say this:
I’ve got people in South Carolina who are thinking about buying a car but are having a very difficult time getting a car loan. But their biggest fear is they think they may get laid off in the next six months. So if we could get credit flowing in the consumer areas, I think it would stabilize the economy more than anything else
Monique wonders:
How exactly is getting credit flowing to unworthy borrowers going to stabilize the economy?
Exactly. Isn’t crazy credit what got us here? So isn’t getting crazy again likely to get us _here_ again?
You know the adage. Doing the same thing expecting different results isn’t a plan it’s hope. So I think we know the “hope” part of Obama. The “change” part… that must be the corruption. We didn’t really have a lot of that under either Bush.
H/T Instapundit
March 11th, 2009 at 8:04 pm
“having a very difficult time getting a car loan. But their biggest fear is they think they may get laid off in the next six months. So if we could get credit flowing in the consumer areas, I think it would stabilize the economy more than anything else”
We have here an analogy of the “mark-to-market” dilemma for banks. The present value of a worker with an uncertain employment situation cannot be determined with certainty. But the worker and the lender may have high estimates of the future value of the borrower. For example, he has a college degree and a history of good steady employment. If the government can do something to reduce the layoff probability, the borrower’s worth and confidence improves dramatically and a car purchase starts a virtuous circle of value added. The phenomenon is called stimulus.
March 11th, 2009 at 8:54 pm
The guy stated he isn’t worth lending too. I’m sorry but you can’t finagle out of he is likely a bad credit risk and should be avoided.
Banks also have to factor in that demand for cars in general is low, so the value if they repossess it is less.