kestrel

kestrel
Ad 2:
2021-06-05 21:09:57 (UTC)

Prompt 122: '07-'09 Financial Crisis

122. The late 2000s saw a global economic crisis. Do you feel like you were impacted by the crisis? Why or why not? How might you stop another crisis from happening in the future?
///

It's amusing to note the wording of this prompt... "How might you stop another crisis from happening in the future?" As if it's some sort of grassroots phenomenon that was up to us, the common people, the population at large, to start and stop. As if it's a natural phenomenon. That's kind of cute. However, I clearly have no room to criticize because my own engagement in the realm of finance is childish at best (as I will explain below).

As I understand it, the financial crisis from 2007 - 2009 was a man-made problem. Financiers made out loans to people they strongly-suspected wouldn't be able to pay them back, and then bet money (they took out insurance policies) that the loans would default. Some banks actually created fake accounts and did the same thing, literally creating non-existent people to take out more loans, rack up debt, and then of course default and fail to pay back the loans.

I may be conflating the so-called Enron scandal with the financial scheme in general, but it's doubtful Enron was unique. They were just the ones who were caught. In both cases, however: what did those rich, clever bastards expect would happen?

So then the Obama administration bailed them out. Those in this fancy club were left with their early retirements and golden parachutes. The average taxpayer, on the other hand, was left holding the bag. Instead of these financiers crashing and burning (like they would have, had they been considered typical businesses), we heard the phrase, "too big to fail" and that was enough of a justification to siphon tax dollars into transitioning these killer corporations back into solvency. Through this process, the rich folks took even more money from the lower classes.

I'm not convinced that the wealthy class of the world have anyone else's interests in mind when they are pursuing their day-to-day. The effect they have on the world at large doesn't seem to enter into their decision-making process. It seems to be all about pursuing power, pursuing the ability to live above the law. What else could be the explanation of Enron's mulcting of life insurance and pension plans... Bernie Madoff's pyramid scheme... Fracking... The 2008 financial crisis... And of course, President Obama's massive bail-out of the corporate financiers that caused it?

We could look at the current pandemic and how that has affected the world. I remember very early in 2020. There was a financial reporter, or an interview of a financier or consultant or something, where they described how they wished everyone "would just get COVID-19 so we can get it over with." I just did a search for the excerpt of the video, and a search for the article, but I was unable to find it. I doubt this is just a self-delusion, because I remember seeing the article mentioned on Anti-War or Common Dreams, a website like that. But the person interviewed was excoriated as a rich parasite providing more evidence of the wealthy elite's disdain for the elderly, the underclasses, the uninsured, the non-rich.

The pandemic facilitated this again, and due to the complexities that influence the financial world - and the rest of the world as a result - no clear picture makes its way into the average person's brain. Meanwhile, the rich live in their insulated, work-from-home lives, making money in their zombie corporations or like Bezos they offset the consequences of spreading the virus by proclaiming warehouse staff and healthcare staff as "essential workers" that "keep the economy rolling" while putting themselves in danger through mandatory overtime, terrible working conditions, and overpriced shit for healthcare.

Rich folks just don't care. And I always wonder what can change that. It's like the flip-side of being told, "Oh, it's just one of those things you need to find out on your own, because when someone tells you, you won't believe them." Or maybe it's like, "He's just not that into you." I'm not sure why these kinds of comparisons come to mind, since comparing an intensely personal relationship to a completely dissociated, completely impersonal, objectified relationship really makes no sense.

Meanwhile... It will happen again as long as there's overpriced healthcare. It will happen again as long as the axe of debt hovers over the heads of "essential workers." It will happen again as long as there's a terrible education system that cannot adequately prepare young people to think for themselves instead of seeing a future as either a drug dealer or a mindless consumer and baby factory, all the while funneling more of their economic power upwards to the rich.

There are so many systems - economic, social, political, cultural - that reinforce the funneling of money and power upwards, and too little that distributes it fairly and equitably to everyone who "chips in" to the economic engine of the USA. Those who are in charge really don't want to change these systems, and the rest of us are unable to make substantive changes to them, so I really don't see prevention as a possibility. It seems more an eventuality, and the pattern will repeat itself over again, sucking more wealth away from us commoners and depositing it in the bank accounts of the rich.

Solutions? Well, the rule-makers emphasize this funneling of spending power upward, so equitable solutions are undesirable and not considered. So it goes.

///

At the time of the 2008 financial crisis, it was early in my current career and I was working at the workforce non-profit, the same I work at now. I don't even remember the time distinctly, and how it affected the work we were doing. I do remember one winter - maybe this was that year - when we were struggling up until literally the last weeks of December to see if we could record a certain number of clients served... I think it was 250. For a team of maybe 6 or 8 people, not all of whom were job coaches, that was a tremendous challenge. In the end we had been able to record that quantity of clients somehow.

It was a lean time for the day job, and now I remember that in fact a government grant dried up overnight. Fortunately, our executive director (who still holds the same post today) quickly diversified our income streams, preventing the loss of one grant to be as devastating as that one had. Personally speaking, I think I had proved to be useful enough to not be laid off at the time, though I do know it was shaky for a while - even for our executive director.

How have I personally insulated myself since then? In a nut-shell, I'd describe it as "financial cowardice." In general, I pay myself and forget about it. I've paid off all debt, and am currently debt-free. I rent instead of own where I live. I bought all my cars in the past 10 years primarily in cash. My savings account is the largest its ever been, and I automatically deposit several hundred dollars per month into savings (equivalent to more than a month's rent). I also deposit the max amount possible into my workplace retirement contributions, although I'm shaky on the particulars of this.

In addition, I have a life insurance policy and an AD&D policy, with my brother as the beneficiary. There was a time I joked with my brother that I was worth more dead than alive, and that after I die he can take my life insurance policy and buy a nice pizza dinner for himself and his family with it.

I have only a small understanding of how well my retirement investments have performed. I receive periodic notices of "their performance" as if they are a living, breathing entity working hard on my behalf, complete with pie charts and graphs and tables. I am intensely skeptical and averse to any "investment opportunities" that come along, and have largely avoided even entertaining the thought of purchasing stock.

This is clearly an amateurish attitude and juvenile fear, but I simply don't trust others enough - especially financiers, whom I cannot appreciate on a personal, visceral level - to bring myself to actively invest money and monitor investment "performance." I also have the opinion that people who look to the stock market as an investment opportunity as vultures and parasites who seek to "make their money for nothing."

I know this is an attitude that holds me back from some varieties of progress and opportunity. Others who are more financially-savvy would consider my financial reserves, and call me daft for essentially stuffing it in a mattress instead of "doing something with it." That's just how it is for me right now.

However, now that I think about it I do want to contact our company's financial advisors, so that I have a clearer picture of my "investment portfolio" and so that it's less of an unknown. I will do this before July. One consultation with these folks can fuel me with enough information that I can reduce my level of ignorance and anxiety about it, and then pretty much forget about it (for real, for real) until next fiscal year.


Ad:0