Saturday, February 2, 2008

And Speaking Of Institutional Stupidity

This is a fascinating look into the world of banking.

How, you may have asked yourself, could the staid and conservative world of banking fall for such an obvious and dopey setup like the sub-prime mortgage mess. Although Glenn Reynolds has pointed out that the crime of not lending to high risk populations has been replaced by the crime of lending to high risk populations, it's clear that there's some grass-roots stupidity going on.

The damage, dear friends, comes from not being able to trust the banks to protect their own interests. I mean, that's how banks operate: However much you think they're going to screw you over (if that's what you believe, and I know I've felt that way from time-to-time), you at least expect them to cover their own asses.

At some point, you're going to feel better off with the neighborhood loan shark.

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