No simple solutions in credit crisis
Published 10:00 pm Thursday, September 25, 2008
With ongoing debate about whether or not to approve a $700 billion government bailout of financial institutions, many Pike Countians may still be trying to figure out just what all of this means to us.
That’s a difficult question to answer. Predicting what will happen when, and if, Congress reaches an agreement on an economic package designed to stave off the weakened credit and mortgage sectors is challenging for even the most savvy business experts. Gather any six in a room and you’re likely to hear six different responses on the right approach to stabilizing these industries, freeing cash flow and staving off a tightening of the credit and banking market. And, trying to predict what will happen if Congress fails to act — or chooses to fund the proposal only partially — is even more difficult.
That’s why it’s important for the average American to take a deep breath and remain calm. Christopher Warden, a professor at Troy University and former writer for Investors Business Daily, summed it up this way: “It’s tough to predict because it’s still in the very early formative stages of what this bailout is, but the general outline suggests there is going to be more credit available,” Warden said. “They will be able to make safer loans.”
If the bailout plan passes, the funding will come primarily from taxpayer dollars. As one analyst stated on Thursday, it’s best to view the plan as an investment – with the expectation that the money “loaned” through the bailout will be repaid, by the financial institutions and investment companies and, ultimately, by the homeowners themselves.
There are no simple solutions to this situation; we must hope, and pray, that our leaders find the wisdom and insight to craft the best possible plan for our economy, our nation and our future.
It’s time to put politics aside and focus on serving the country.