Simple Enough To Understand

Much of the confusion and disagreement regarding the economic mess occurs because nobody can understand it all. Some say it was caused partially by the sale and purchase of mortgage “derivatives’’. Can you really understand and explain exactly what derivatives are? I can’t.   Every time one person explains why Obama’s plans are dead wrong, another person explains why his plans are wonderful and necessary. Most of the time, most of the people can’t pretend to understand what either person is talking about.   Ah, but then along came AIG bonuses and all that changed. Everybody can understand those bonuses. The guvmint gave AIG a fortune in bailout money to help straighten out the economy. AIG almost immediately gave a couple of hundred million of those dollars to the very executives who were running the company when the you-know-what hit the fan. The public is screaming that that ain’t right.   It’s a mistake for guvmint to do something stupid if the citizens can understand it. We haven’t seen such sign waving and hollering since the 1960s.   When the public disagrees so loudly and in such numbers, even presidents and congresspersons listen. Obama was so mad he set out to find a way to get the bonuses back. One idea is to tax the bonuses away.   Well, some seem to realize that (1) the bailout as written allowed for such bonuses, and (2) once a guvmint backs down on something that it agreed to, there is a cost involved. For example, right now the guvmint wants private investors to purchase much of the financial world’s “toxic†assets. That might be hard to do, if the guvmint backs down on what they agreed to in the bailout.   On the other hand, the stock market went up today, perhaps because of the guvmint saying private investors will be offered a good deal on toxic assets.   BTW, everybody says credit is nonexistent, but everywhere I look lenders are touting fast, cheap loans on everything from airplane purchases to quick cash.   Me, I’m just as confused as I was last week.   So, what’s it have to do with aviation? Everything. People and businesses usually don’t buy airplanes unless they have faith in the future. That kind of.a faith is rare, these days.   We’d love to post your comments. Please click on the comment tab at the top.