building wealth in the pursuit of happiness

Sep 30, 2008

how the bailout failure affects us

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NY Stock Exchange

I didn’t see that one coming. Then again, nobody did.  I’m a little bit shocked - our family’s net worth dropped about 10% in one afternoon, wiping out years of savings - but then again, I think the cure would have been worse than the disease.

In every analysis and op-ed I’ve read, I’ve failed to understand one point:  why should the government assume the risk taken on by private companies?  Yes, it’s all interconnected, and yes, there’s a trickledown to Main Street, etc., but wouldn’t there be a trickledown effect from taking on an additional $700 billion in debt?  The rule of capitalism is that risk is inversely proportionate to reward. Now we are seeing the market adjust itself to where it should truly be, sans government meddling.

I know the most likely scenario is a watered-down bill, similar but less expansive. That’s a good thing.  The pain we’re all feeling (and trust me, anyone with a toe in anything more complicated than a checking account feels this) is the cost of living in a capitalist society.  No socialized medicine, no socialized pensions, and hey - no socialized banking bailouts.  It’s philosophically consistent.

I’m tired of worrying about macroeconomics. I know that I’ve written more articles than usual on that subject, simply because it’s hard to pretend it’s not happening.  It is.  But let’s face it, the same things are true, over and over again, regardless of the Dow’s value, or the latest governmental power grab or the death throes of a theoretically conservative administration.  Here’s how the bailout failure does not affect us; you still need to:

  1. Spend less than you earn. If you don’t need it, don’t spend money on it.
  2. Find out ways to earn more. Don’t sit on your current income.  Hustle.  Make more.
  3. Stay healthy. Getting sick in America is going to be a more and more expensive event.
  4. Take care of your environment. Even if you don’t believe in climate change (and if you don’t I’m not sure what I could convince you of, anyway), keep your little corner of the world clean as you can.
  5. Be kind. Not much else matters in your interactions with the world.  There is evil in the world, and it must be fought, but let’s face it - in most human interactions, a moment of kindness is worth a month of assaults.
  6. Vote. I know presidential elections get all the attention, but let’s face it - yesterday’s events were the results of votes by congressmen, ALL of whom are up for re-election this November.  Make your voice heard.

So tomorrow try not to read the papers, and eat a piece of fruit.  The Vitamin C and fiber will do you good. Keep your chin up.

Creative Commons License photo credit: pheezy

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