Quote:
Originally Posted by peter12
The problem isn't capitalism or the free markets though. Honestly, the reason why these institutions are dominant is probably because they are the economic/choice systems that are the best at managing complex and large societies. Judging from what we see in nature, the reciprocity involved probably corresponds to our deepest instincts of social cooperation.
No, the problem is greed and entitlement that has become central to our lending system. It's the average individual's fault for thinking he "deserves" a certain type of lifestyle that neither he nor the economy can afford. Consumption levels need to go down and we need to get more in touch with the true costs of the products we purchase.
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I think this is the big one. Entitlement.
Entitlement is what crippled the auto industry. Entitlement is what forced governments into enacting dangerous banking and loan legislations. Entitlement is what got into people's heads when they wanted a house, two cottages, three cars and a boat, with a median salary.
The banks saw a way to increase their market share, so they went along with it, hoping it wouldn't backfire.
I think people need to come to grips with the reality of the situation. We screwed up, and it hurts. However, this isn't 1929. Not even close. Realistically, we are facing a mean recession, but not a depression. Things will improve reasonably soon so long as people/governments don't do anything overly stupid (Smoot-Hawley Act type things, or total retreat on consumption). In some regimes, the media would be dragged out and shot for the sensationalist press that is making the situation worse.