I don't want to alarm you, but killer bees are no longer the biggest threat to this country.
It turns out we really are our own worst enemy. As a country, we've really screwed our own pooch so much we've turned a once proud and powerful free-enterprise system into the economical equivalent of falling on our keys.
On my own, I don't understand much of the current situation. When it comes to things financial – along with matters of basic hygiene, how I feel about people in our neighborhood and what I like to eat – I rely of my wife for information.
My wife is a brilliant woman and things like this are right up her alley. She's got a PhD in economics and she is always willing to teach me about the area of her expertise. Just the other night she told me all about supply and demand (apparently, it means that I have to supply whatever she demands).
Not to demean her accomplishments though, but it's not hard to look like a financial genius when standing next to me. I still have a ceramic Snoopy full of “just in case” pennies.
If not for her I would spend all my money on Mountain Dew and cheese.
From what she's told me, a lot of the problem stemmed from sub-prime mortgages which are mortgages that are given at a sub-prime rate, to sub-prime borrowers wearing sub-prime shoes.
Now, I may by new to this world of people who know that 401k is not just a whole lot of k, but even I could have told you this was going to lead to trouble. The name should have been everyone's first clue. I don't want sub-prime time TV. There's no way on earth I'd eat sub-prime beef. Why would I get a sub-prime loan?
And yet people did, at an alarming rate.
Speaking of alarming raters, the other problem with these loans was that many of them had an adjustable rate. “Adjustable” is an interesting word. Consumers look at the word “adjustable” and think, “hey, my pants are adjustable, the seat of my bicycle is adjustable, I like things that are adjustable. I want my loan to be adjustable too.”
The lenders on the other hand see the word and think “Hey, I bet we can use this to screw people up the back of their adjustable pants.”
And they did, rates shot up and – as was foretold by the name of the kind of loan – mortgage payments got “adjusted” much to the shock of many sub-prime borrowers who were under the impression that the bankers were going to be their friends.
Have you ever seen a movie where the bankers are a bunch of kindly old men looking for people to help with the wads of cash falling out of their pockets? No, you haven't, because in movies their always portrayed as a bunch of heartless, money-grubbing dillweeds.
Movies like this are natures way of warning us that bankers are, for the most part, heartless, money-grubbing dillweeds. The kind of guy who would kick a random stranger in the nards for $5.
The joke was on the money grubber this time. Not only did people not like the new much higher rates, they tried to pay off the difference with gummy bears.
Apparently if you're the kind of person that thinks a sup-prime anything is a good idea, there's also a high chance you consider your favorite candy to be legal tender.
The last straw in the camel breaking economy was when President Bush, because – according to reports – is a giant a-hole, took that little knob on his desk that says “economy” and cranking it all the way down passed “rocky” to “good crap we're boned.”
I hope this look at the economy and it's troubles has proven helpful. If you have any questions be sure to let me know. I'm putting together some helpful handouts to explain the whole thing with charts, graphs and a cartoon of the stock market waving it's genitals at everyone. I just need to find a Kinkos that will let me pay for printing with Swedish fish.
Steve Shinney is doing what he can to weather the current financial situation by hiding under the covers and clinging to to his IRA while crying. Calming comments can be left below.