Bill Maher of HBO's "Real Time with Bill Maher" has had some pointed comments to make about the state of the U.S. economy for the past few weeks, namely the home foreclosures that had led to last year's subprime crisis and the current debt and lending problems affecting consumers. Maher's argument is that what we consider to be the American dream, namely the stereotypical home in the suburbs with the white picket fence and two-car garage, is actually the American fantasy. He says that the reality is, most Americans can not afford to have all the extravagances that are advertised to us, and we put ourselves in financial peril by buying a bunch of stuff that is well beyond our budget. While talking with San Francisco mayor Gavin Newsom, Maher said that about 1/3 of the U.S. rent their homes, 1/3 are homeowners who pay mortgage and only about 1/3 actually own their property outright. Maher made the point that it was unfair to bailout the mortgage holders, especially if they had unrealistic views of what they were entitled to own, and then neglect the renters who have a more realistic understanding of their financial standings. What we should do to "reward" renters isn't brought up, nor is there really an answer for it. But there is much wisdom is the dangers of bailouts. And I fear for the precendent this is setting. Both individuals and businesses are going to come away from this whole experience thinking that if they screw up badly enough, the government will swoop in to protect them from the consequences of their actions. Look, ultimately it comes down to responsibility. You should know that it's the job of salesmen to string you along and promise you the moon. If I believed every commercial I saw on television, I would think drinking Coca-Cola would make me a star athlete, Budweiser would make me a chick magnet and eating at Pizza Hut would give me a magical experience (as opposed to indigestion.) So why do people check their intelligence at the door when it comes to entering foolish loans? Look people, a two-story home is suburbia isn't your birthright. It isn't even normal as far as history goes. Most people in the U.S. prior to World War II tended to live in major cities in apartments or homes that were on the second floor of a building above the shops that they owned. There was a word for people who lived away from the city. Farmers. –Stephen Payne, Editor, Oil and Gas Investor This Week; www.OilandGasInvestor.com; spayne@hartenergy.com
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