How Do We Get Ourselves Out Of This Crisis?
I have been accused by some readers of being a "Monday morning quartback", of critisizing and not offering solutions and of getting the facts wrong about why we are in the mess we are in. The fact of the matter is that the only one in that list that I am actually guilty of is not being able to offer a credible solution to a problem that is slowly sucking the country and the world down.
Now I am a pretty smart guy, but not smart enough to have the answer to a problem that the "best" minds on Wall Street created (of course with the help of the politicians of both party's), and that the "best" minds on Wall Street, Washington, academia and elsewhere can't seem to solve.
If only they had used their power for good instead of evil.
In any event, as I have mentioned before when it comes to macro-economic issues as well as the inner workings of markets, I find Jim Cramer to be an extremely knowledgable source. Not the greatest stock picker in the world, but that's alright.
These are his thoughts on how we can get out of this problem, which is much more definitive than the ever changing drivel that keeps coming out of Washington.
Love him or hate him, the man has actionable and definitive ideas based on an extremely extensive and successful background on Wall Street and as an observer of the markets and economy.
"According to Cramer, neither nationalization, which does too much, or euthanasia, which does too little, will work to save the financial system. He said what will fix it, however, would be offering 40-year, 4% fixed rate mortgages to everyone, especially to those whose mortgages are based on current appraisals. He again advocated forbearance for the banks, with no "mark-to-market" rules enforced.
Cramer said we simply cannot let the chips fall where they may, and the alternative of nationalizing will wipe out the preferred stock and so much more."
This is a short synopsis of his idea, but to me it sounds as if it makes more sense than any of the start and stop plans that we have gotten out of Washington so far. I know the same critics will say that Obama has now ony been in office for _____ days, but Tim Geithner has been on the scene for a lot longer than that (the guy the administration just had to have despite his tax problems), as have the members of congress, and all of them still can't seem to be able to grab their own a___s with both hands.
Maybe they should bring in some new outside advisors.