Journal Entry #4 The Financial Crisis and the Future of our Children

What about the future of our children?

The films that we viewed in class this week were truly an eye opener for me. We are all being affected by this economic recession , yet the average person has no idea how we got here to begin with. It is hard to believe that the start of the fall of our economy took place during the 1980's with the Reagan Administration, and even before that. We have seemed to carry on these bad seeds from one administration to the next. I cannot see how deregulation can possibly be a positive thing, the government basically allowed these companies to do whatever they wanted. They gave them too much freedom and they let things go way too far. I enjoyed watching To Big to Fail and I think this is a movie that every American should watch and can learn from. This gives us a behind the scenes perspective on what happened to our country's financial system and how it ultimately failed us. The documentary that we watched broke it down for us so we could understand how these corporations operated and how they acted illegally. It makes me wonder how Paulson could have been so shocked about the situation when he was involved with these acts during his time as CEO at Goldman Sachs. In my opinion it is hard to blame the general public for the economic recession. It is true that individuals did receive loans that they should not have been approved for. However, these people were basically misled. They thought if they were being approved then they must have the means to make the payments. The teaser rates were not explained properly and many people did not even know that these rates were adjustable or how much they would be going up. It is true that no one expected the housing market to fail, but honestly they should have seen it coming. We have the average person who is able to make his monthly mortgage payments because he does well and owns his own construction business, all of the sudden the recession hits and he losing his business. In turn that family no longer can make their monthly mortgage payment and the family has to foreclose on their home. These are the reasons I feel that we cannot blame this crisis on the American public. Certainly people took advantages of the massive credit options provided to them, but these corporations did not have any regulations in place and just gave out a loan to just about anyone. They invited this to happen. The question now is how to fix it, as it seems the loans are again being approved for low credit scores. I believe we need to have some regulations put in place I am worried about the future of our country and for the future of my son.