Saturday, October 25, 2008

The Stupidest Housing Crash Idea

The most distressing part of the housing crash is how everyone is willing to throw away capitalism, over a crisis which hasn't even caused a recession yet. Having caused this crisis largely through idiotic government policy encouraging lenient lending standards, politicians now claim to be our saviors. Even they have not approached the idiocy of this idea though.

Napoleoni said that in Islamist finance, banks do not charge interest for loans and that this encourages entrepreneurs."

Money has to be invested," she said. "It has to be invested in the real economy, and through real growth, they can produce more money. This system could help us to get out of the current crisis."

Charles Kalm, a graduate assistant from the International Studies Institute, said Americans need to heed the advice of economists like Napoleoni."I think that we can all agree that our economic system is malfunctioning," he said.

"There are a number of things that are going to have to happen to help the average guy, all of the working people, the banks and to help with the main problem, which is faith in the economy."



Yeah, and exactly how well has this financial vehicle worked out for the Islamic world? Even with all of their oil resources, the UN has to do special reports on the economic disaster that is the Arab world. Despite all this wealth, their financial insitutions are a joke. For example:

With few exceptions, the region is plagued by corrupt, state-dominated economies, excessive regulation and bureaucracy, and poorly constructed legal and regulatory frameworks that hinder private sector development, foreign direct investment, and job creation. The 280 million people of the 22 Arab countries combined have a gross domestic product less than that of Spain; 25 percent of Arabs live below the poverty line; foreign direct investment rose everywhere last year, except the Middle East; total nonfossil fuel exports from the entire region amount to less than the total exports of Finland; the Arab world has witnessed a near zero percent growth rate over the past 30 years, while all other developing countries grew at 2.5 percent per annum.

2 comments:

Thomas said...

We're in a recession, dude.

Moreover, the economic growth of much of the late 90s and early 2000s is not based in anything other than financial manipulation and real estate value.

Face it, the elitist Republicans you love and the bankers' Democrats have sold us out to free trade, free immigration, and deregulation. We are going to the poorhouse. Get it in your head and get independent!

James B. said...

A recession is technically defined as 2 quarters of negative GDP growth, as of this week's announcement, we have (barely) had one. It is usually one of those things that is not identified until it is over.

The housing crisis not caused by free trade or deregulation, in fact it was bad government regulations that contributed towards it. You might have a point as far as immigration, in the sense that many of the subprimes were given to illegal immigrants. Good luck with your indepedent movement, but I am still sticking with my friends Adam Smith and David Ricardo.