Dear friends,

Have you ever stopped to consider for a moment the true origin of the havoc and economic devastation we are going through all over the world?

To the best of my knowledge, the greatest financial and economist brains everywhere seem to be at a loss to understand how we have been able to reach the present slum, many consider the worst ever since the 1929 great crisis…

There is, however a certain consensus that the starting point has to be found in the sub prime mortgage loans that were contaminating the entire economic system with billions of dollars in the so called “toxic assets”.

And yet, I strongly believe that we are losing sight of the true and prior origin of this chaos. I would say it is just the normal consequence of the wave of materialism that have been flooding the whole world, but even more so, our “beloved” first and “civilized” world, as of the end of WWII…

Our culture has been, and still is, the culture of money, image, fast success and power. Each time, we want to have access to more riches and to enjoy life as much as possible, no matter at what cost. We have been used to live in many cases far beyond our true possibilities.

Those who were already rich wanted to be richer and it was of the utmost importance to succeed as fast as possible even at the risk of hurting other people…

Greediness and acquisitiveness are the basic ingredients to be able to get there and be respected and admired, to have our ego well overwhelmed by the conceit of what we have been able to achieve…

Eventually, this unlimited ambition opens the way to unmeasured corruption, as in those cases that have ended up in the collapse of the biggest banking or insurance corporations, not to speak of people like Madoff…

And now we are all shaking and fearing the nerve-racking consequences that lay ahead in the next years to come. But have we learnt the lesson? Or as soon as matters come back more or less to normal, we shall revert to pump up once more the bubble of materialism?
What do you, my friends, think?

Greed and mismanagement have led to this collapse.

Working people did not cause this, although we will be paying the tab to bail the banks out.

It is not the greed of the average taxpayer who is responsible for this mess.

While I agree that we are, as a whole, a materialistic bunch, it is unfair in my opinion to paint everybody with the billion dollar parachute payouts, reserved for a very special class of very greedy people with no conscience.

Reflection and accountability for this mess should be put squarely on the shoulders of those that caused it.

The rest of us are trying to put food on the table while our income decreases, we lose our jobs, and our houses are foreclosed on. 'We' are not the cause of the aftermath of gross mismanagement and government incompetence.

Sorry Jake,


OK. I’ll try to be more precise in my analysis.

Let me start by saying that I didn’t say that the average taxpayer is the ONLY responsible party for this mess. And we (I happen to be also an average taxpayer) certainly are not responsible of the mismanagement and government incompetence that is now provoking “the billion dollar parachute payouts”, as you put it very rightly.

However, the average taxpayer is not completely free from guilt.

The mismanagement and incompetence of great banking corporations is a consequence of mishandling colossal amounts of money, but the average taxpayer was the final addressee of a good deal of this money.

We do not have to forget that bankers profit largely depends of their loans at a given interest to as many millions of people as they can.

Who were the beneficiary parties of the sub prime mortgages that the big banks were granting at low interest rates?

In Spain, during the last decade apartment buildings were built by thousands along the Mediaterranean coast, where weather is mild and the sun shines most of the time. And as prices were steadily soaring month after month retired people from Germany, France, Great Britain and Scandinavian, came over to Spain to buy all this housing at prices out of any logic.

A 3 room apartment facing by the sea side in the Costa del Sol could sell in 2007 for anything between $200.000 to $300.000… A normal price in the year 2000 would have been maybe $45.000…

So everybody looking forward to a very fruitful and highly profitable eventual investment came over and didn’t hesitate to put in all their savings plus any eventual Bank loans they might have gotten, at very low rates…

As for the Spanish eventual customers a great amount bought apartments in Florida, for they were still cheaper than here, and they could boast among their friends of having an apartment in Boca Raton…

Families who had 2 cars with less than 30.000 miles each, decided it was high time to buy the latest model of Toyota Lexus or perhaps a Mercedes or both, so they applied their bankers for a loan which was immediately granted. Furthermore, many even decided that the best thing to do was to buy one car for each member of the family. One of my retired friends (grandpa, grandma, 2 sons and 3 grandsons of 23, 21 and 19, living all together in a rather big villa) ended up with 7 cars (their garage could only hold 3! ).

Money was cheap, could be borrowed without any problems, and millions of people thought this bonanza would last forever… They certainly didn’t remember the parable of the seven lean cows that devoured the seven fat and sleek cows…

And so the “house of cards” collapsed and millions now find themselves “trying to put food on the table while their income decreases, many lose their jobs, and their houses are foreclosed for lack of payment” as you say…

In Spanish we have a saying that could be translated as “stretch the arm over the sleeve” meaning to be a big spender beyond one’s possibilities.

And this is just the consequence of an excess of ambition and excesive materialism.

At least, this is how I see it