The markets have been very volatile lately and according to most experts the United States has entered a recession. All of this uncertainty and financial difficulties is a result of the credit crises that was sparked by the collapse of the subprime mortgage market. We have now seen the downfall of three major investment banks and a number or mainstream banks. To restore the financial system and to fend off a depression the US government would like to bail out Wall Street with a whopping $700.<\/p>\n
But while everyone is focusing on the banks and financial institutions that are in trouble because of the credit crunch, few are focusing on the people that are getting hurt. Many people got into a three- or five- year ARM (Adjustable Rate Mortgage) and when their mortgage adjusted to a higher rate, they could no longer afford payments and their homes went into foreclosure. As more homes were taken back by the banks the housing market in many areas started to fall. People who borrowed one hundred percent for their home immediately started to have negative equity issues. With nothing to lose many have walked away from their homes, leaving the banks with further loses and their mortgage-backed securities significantly unvaluable.<\/p>\n
It Take Two to Tango<\/strong><\/p>\n Clearly it takes two to tango and this credit mess is the combined fault of both the banks and borrowers—they were both deceptive with each other. Borrowers were able to get home loans without having to prove their income; many therefore deceived the lenders regarding their real salaries. Lenders for their part were offering people with bad credit interest-only loans for above-market interest rates that seemed manageable at the time of the transaction. In many cases they were not, however, up-front about what would happen when the rate adjusted. Any reasonable outsider was able to see that this deception would come crashing down at some point, to everyone’s detriment.<\/p>\n Indeed this is what has been happening over the last eight months or so. <\/span>Banks no longer trust people and there is virtually no such thing as a no-doc-loan anymore—if you want a loan you have to prove your income. Banks don’t even trust their fellow banks anymore.<\/p>\n The Torah Predicts a Crises<\/strong><\/p>\n The Torah discusses the guilt offering that was brought up on the Alter in the Temple by a person who had sinned. There are numerous reasons why a person would bring a guilt offering. One of them is for dishonesty. The Torah says (Leviticus, 5:21–26), “If a person sins … by falsely denying to his fellow concerning a deposit, or money given in hand, or an object taken by robbery, or he withheld funds from his fellow … <\/span>[he] shall then bring his guilt offering to the Lord: an unblemished ram from the flock with the [same] value, for a guilt offering, to the kohen.”<\/p>\n It seems clear to me that the fall of the mighty the great Wall Street titans and the shaky US economy and the volatility in the markets are a result of dishonesty that has taken place over the last seven years and Bear Stearns was the first of many sacrifices offered as a result of this. In fact the liquidity crisis is a direct result of a lack of trust between banks.<\/p>\n If the economy is to recover, all of us—financial institutions, Wall Street professionals, and regular people alike—must take the Torah’s advice to heart and there must be a collective repentance and atonement for the dishonesty of the past. <\/p>\n","protected":false},"excerpt":{"rendered":" The markets have been very volatile lately and according to most experts the United States has entered a recession. All of this uncertainty and financial difficulties is a result of the credit crises that was sparked by the collapse of the subprime mortgage market. We have now seen the downfall…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[37],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=\/wp\/v2\/posts\/1738"}],"collection":[{"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1738"}],"version-history":[{"count":1,"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=\/wp\/v2\/posts\/1738\/revisions"}],"predecessor-version":[{"id":2239,"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=\/wp\/v2\/posts\/1738\/revisions\/2239"}],"wp:attachment":[{"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1738"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1738"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.levibrackman.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1738"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}