The financial crisis of 2008 was delivered on a tsunami of personal (mostly mortgage) debt, packaged by bankers as instruments by which they could gamble on the future movements of the level of interest rates. Much of the mortgage debt was taken on by Don and Donna Dope, who had been enticed by commission-hungry fraudsters to overeach themselves.
Don and Donna had also binged on credit cards. Yet, this gormless couple are part of that new classification of greed – the aspiring class – who hypocritically repeat right-wing warnings of the vast expansion of government debt, whilst gorging on their own debt like pigs in a trough. What is obviously OK for them is not what governments should do. What governments should do is to prop up Don and Donna by retaining a near zero level of interest rates. Oh what shocks await! Interest rates are likely to rise “significantly” over the next five years, according to PriceWaterhouseCoopers, the international accountancy and advisory company, who believe interest rates on mortgages may end up higher than before the recession.
In October 2014, in the UK, 67,701 mortgages worth £10.5billion were approved, the highest total since February 2008, spurred by the government’s intervention in the housing market, in which the ‘Help to Buy Scheme’, to quote: ‘helps you buy a home with a deposit of 5% of the purchase price. It’s open to both first-time buyers and home movers for new-build and older homes in the UK with a purchase price up to £600,000 … The guarantee is provided to your mortgage lender by the government – not to you’. Put simply, the UK Government offers lenders the option to purchase a guarantee on risky mortgage loans, and so offer home buyers more high-loan-to-value mortgages. So, pre-Crash conditions are created, with Dopes borrowing £10,000 on a credit card, to put down as a 5% deposit on a £200,000 home. Many also take on (cheaper) interest only mortgages, so will never own their house – a disguised form of renting. This at least carries a benefit of the government not being able to steal a house to pay for future nursing home costs.
If you think that Don and Donna Dope are a class of British idiot, then think again. In America, the average credit card debt of indebted households has reached $15,609, according to Federal Reserve statistics. The same source shows that total student loan debt has reached $1.2 trillion, with the average student loan debt being $32,956, some of which is being ‘serviced’ by middle-class girls turning to prostitution.
Americans have an $8.2 trillion mortgage noose around their necks. According to the Mortgage Bankers Association, 8 million Americans are at least one month behind on their mortgage payments. The knot tightens.
Don and Donna Dope drive to work in their debtmobiles – 70% of all car purchases in America involve car loans – then get home to a letter telling them to go to their hospital for tests. That’s OK, they innocently think, we’re covered by insurance. Wrong! Even those ‘aspirants’ like Mr. and Mrs. Dope who have health insurance, end up with medical debt headaches. They can not meet the cost of their ‘co-payment’- the portion of their treatment costs that the glossy brochures do not focus on. The American Journal of Medicine claim that 60% of American bankruptcies are the result of medical debt.
Today America, tomorrow Britain.
Not to worry, the Dopes can always borrow money to pay off what they already owe! In December 2014, the Dope class borrowed another $19.3 billion, bringing the total Dope debt to $2.5 trillion. Will some of this be paid back quickly? Oh No! Not much profit in that for the debt-dealers of credit, who extract a slow death by charging an average interest of over 13%. Thus, the Dopes will take over 25 years to pay back a $10,000 credit card debt, if making a minimum payment, which is all they can afford!
How do the banks and their ex-politician directors get away with this? Surely, as defaulters are fed to the debt collection sharks, the supply of Dopes is diminished. Not so. Dopes breed Dopes. As some drop out of the Debt-A-Dope game, ready made replacements are on the conveyor belt – the next generation of Dopes. They have been told by politicians that they are “risk takers” and “aspirers”.
Rarely in history have so many egos been manipulated by so few.
Don’t buy in to this rotten system.
Save for what you need, and do not go into debt for what their manipulative ads make you want.
Tell them all to go to hell.
lenin nightingale 2015