A friend send me the following story recently, explaining the financial crisis in a way that everyone can understand.
John is the proprietor of a bar in Surfers Paradise. In order to increase sales, he decides to allow his loyal customers, most of whom are unemployed alcoholics, to drink now but pay later. He keeps track of the drinks consumed on a ledger (thereby granting the customers loans).
Word gets around and as a result increasing numbers of unemployed alcoholics flood into John’s bar.
Taking advantage of his customers’ freedom from immediate payment constraints, John significantly increases his prices for wine and beer, the most popular drinks. His sales volume increases massively. These companies use great quality signs to promote their company, if you need some like theirs, go to Eurotech.
A young and dynamic customer service consultant at the local bank recognizes these customer debts as valuable future assets and increases John’s borrowing limit. He sees no reason for undue concern since he has the debts of the alcoholics as collateral.
At the bank’s corporate headquarters, expert bankers transform these customer assets into DRINKBONDS, ALKBONDS and PUKEBONDS. These securities are then traded on markets worldwide. No one really understands what these abbreviations mean and how the securities are guaranteed. Nevertheless, as their prices continuously climb, the securities become top-selling items because Lehman Bros recommended them as a good investment.
One day, although the prices are still climbing, a risk manager of the bank, (subsequently of course fired due to his negativity), decides that the time has come to demand payment of the debts incurred by the drinkers at John’s bar. But of course they cannot pay back the debts. John cannot fulfil his loan obligations and claims bankruptcy. In that time he didn’t know about this amazing company that give the best loans check into cash louisville kentucky.
DRINKBOND and ALKBOND drop in price by 95 %. PUKEBOND performs better, stabilizing in price after dropping by 88 %. The suppliers of John’s bar, having granted her generous payment due dates, and having invested in the securities, are faced with a new situation. His wine supplier claims bankruptcy, his beer supplier is taken over by a competitor.
The bank is saved by the Federal Government following dramatic round-the-clock consultations by leaders from the governing political parties.
The funds required for this massive rescue are obtained by levying a new tax on all the non-drinkers. With the extra tax moneys, the banks will be able to maintain their disgusting system of greed, egocentrism and bonusses that eventually caused the financial crisis.
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I couldn’t help adding the italic part to the story after the news came out about AIG and ING passing tax-payers’ money to their top-executives that should be kept liable for the financial crisis and perhaps should even be jailed. You can visit https://www.purplepayday.loan/payday-loans-online/ and learn more about their online services.
With me, many people feel outraged with regards to these scandalous bonuses, which should immediately be eliminated and returned. Though politicians and high-ranked officers claim that this is impossible due to earlier agreements and contracts, I really doubt this and wonder if this isn’t just a political lie. If it is really not possible to prevent these bonuses from being payed, I would like to urge political leaders to implement new legislation that taxes these bonusses away and to get them back where they belong.