Averthan D'Souza wrote:
>
> What needs to be debated is the nature and the extent of regulations
> which need to be put in place in order to ensure that Social Justice
> prevails.
>
Mario responds:
>
Averthan,
>
If you have some notion of social justice, you are free to follow that in your
personal investing, but any attempt to impose notions of social justice on
everyone else in the form of regulations is harmful and counterproductive. To
begin with, who decides what the appropriate "social justice" is?
>
In fact, it was an attempt by the political liberals, mostly Democrats, since
Jimmy Carter to engage in "social justice" by forcing banks to lend money to
risky low-income borrowers, who normally rent until they can afford to buy,
that caused this mess in the first place.
>
Real "social justice" in investing is when the investor gets his or her money
back with interest or a capital gain, without any coercion by anyone else.
>
Any sensible regulations should be such that the intermediaries i.e. the
banking and investment banking system, do not engage in risky schemes like
sub-prime lending and 100% plus lending and lending to risky borrowers, which
is what was being forced on the banking system by the Democrats since the
Carter administration. The Republicans resisted, but not hard enough, because
they were being called racist for opposing the social engineering that was
taking place and did not have sufficient votes to go any further.
>
Date: Mon, 13 Oct 2008 13:02:30 -0700 (PDT)
From: Mervyn Lobo <[EMAIL PROTECTED]>
>
> If we now know the answer to that question, the first resolve has to be
> to re-instate the regulations that were in place. Re-instate the laws
> that worked for eighty years before the current US administration were
> lobbied to remove the laws.
>
Mario responds:
>
This is factually false. It was the Carter administration that started social
engineering in lending, and the Clinton administration that pushed the banking
system to increase their risky lending to low income borrowers and even
threatened them with legal action if they cut back on such lending. Besides,
the oversight of the Financial Services industry has been in the hands of
Congressional Committees since the 2006 elections and they were publicly
proclaiming that everything was fine, while receiving huge political
contributions from the same people they were supposed to be over-seeing.
>
Officials in the current administration as well as John McCain all warned that
the system was getting too risky, but they were unable to garner enough votes
to do get any legislation passed that would impose additional regulations that
would slow down lending to low income borrowers.
>
Mervyn wrote:
>
> The current systems of Govt giving a helping hand to those who
> bankrupted the companies they were running, only serves to worsen the
> economy. The Russian economy collapsed because of this and the US
> economy is about to follow.
>
Mario responds:
>
As we have seen with Bear Stearns, Merrill Lynch, Lehman Bros., Washington
Mutual and Wachovia Bank no one is giving a helping hand to those who
bankrupted the companies they were running. These have all been acquired by
other entities for pennies on the dollar and the executives are being
investigated by the FBI to see if they broke any laws.
>
Any comparison between the US and Russian systems is simply absurd.
>
Mervyn wrote:
>
> PS. Those fleeing to the 'safety' of US treasury bonds are the people
> who are essentially sponsoring the wars in Iraq and Afghanistan. The US
> govt does not have the ability to finance these wars on its own.
>
Mario responds:
>
Here we see Mervyn contradicting himself from one paragraph to the next. In
this same post he previously wrote, "If you are in the markets, you are there
for only one reason: to make money." Now he is trying to make a bogus
connection between investing in US treasury bonds and the liberation of 50
million Muslims from Muslim tyrants.
>
On the other hand, Averthan should be applauding investors in US treasury bonds
if this is funding the liberation of 50 million Muslims.
>
Mervyn apparently has a problem with providing freedom and democracy for
millions of Muslims who have never experienced this before, even while he
chooses to live in a free democracy.
>
