This is a great discussion and I am happy to participate.
jdcpapa,
Again, we agree on most but you leave me puzzled when you say:
jdcpapa wrote:Debt is not a by-product of spending more than you earn.
What else is it? You say:
jdcpapa wrote:Debt is a result of borrowing money to fund your lifestyle.
Well yes, exactly. More precisely, only the part of the lifestyle that is not financed by earnings. Or in other words, when someone spends more than he earns.
John,
I love your blog, but I have noticed, over the years, your sometimes seemingly rosy and apologetic description of the Baby Boomers and a vilifying tone when you talk about Generation Xers. That's why I initially responded.
But you got me intrigued when you said:
John wrote:If it were just up to the Gen-Xers, then it wouldn't have happened, because an ethical Boomer generation would have stopped their Gen-Xer employees from committing fraud.
So you are saying the Baby Boomers are an unethical generation, allowing (as their bosses) the Generation Xers to go ahead and commit fraud.
Instead, of calling the baby boomers outright unethical, I would characterize our generation more as self-indulgent with a sense of entitlement. And then the cause (i.e. self-indulgence) justifies the means (any, I guess). Baby boomers seem to think they have the right to take the resources of the generation before and after them, just as happened with the roaring twenties generation.
It is true, the Generation Xers have maybe contributed to the prolongation of creation period the debt mountain (or, "debt heap", as I like to call it), mainly with their ruthless move towards complexification (which makes it much easier to lie to others and to oneself).
But when you say:
John wrote:If it were just up to the Boomers, then it wouldn't have happened, since hardly any Boomer could create a residential mortgage backed collateralized debt obligation if his life depended on it.
I do not think that this is a valid hypothesis, as many engineers behind these products were/are baby boomers. Actually, many, if not most, of the engineers behind this giant ponzi fraud that we are still witnessing are baby boomers.
Examples:
Joseph Cassano of AIG
Ira Wagner of Bear Sterns
Just to name a few.
And yes, I could not agree more, when you say:
John wrote:And incidentally, it doesn't just depend on the particular securities of our time.
Yes, for example, CDOs existed in the 1920s, they just carried other names.
But I would like to point to the following:
Are the Generation Xers with their flaws largely a product of the tone that we set, when we were dominant. I just want to say:
Gordon Gekko, Wall Street wrote:Greed is good.
John, as an expert, what went wrong in the handover between post-war generation and the baby boomers?
Also, I suggest the following read:
http://ilene.typepad.com/ourfavorites/2 ... kind-.htmlThis is a great discussion and I am happy to participate.
jdcpapa,
Again, we agree on most but you leave me puzzled when you say:
[quote="jdcpapa"]Debt is not a by-product of spending more than you earn. [/quote]
What else is it? You say:
[quote="jdcpapa"]Debt is a result of borrowing money to fund your lifestyle. [/quote]
Well yes, exactly. More precisely, only the part of the lifestyle that is not financed by earnings. Or in other words, when someone spends more than he earns.
John,
I love your blog, but I have noticed, over the years, your sometimes seemingly rosy and apologetic description of the Baby Boomers and a vilifying tone when you talk about Generation Xers. That's why I initially responded.
But you got me intrigued when you said:
[quote="John"]If it were just up to the Gen-Xers, then it wouldn't have happened, because an ethical Boomer generation would have stopped their Gen-Xer employees from committing fraud. [/quote]
So you are saying the Baby Boomers are an unethical generation, allowing (as their bosses) the Generation Xers to go ahead and commit fraud.
Instead, of calling the baby boomers outright unethical, I would characterize our generation more as self-indulgent with a sense of entitlement. And then the cause (i.e. self-indulgence) justifies the means (any, I guess). Baby boomers seem to think they have the right to take the resources of the generation before and after them, just as happened with the roaring twenties generation.
It is true, the Generation Xers have maybe contributed to the prolongation of creation period the debt mountain (or, "debt heap", as I like to call it), mainly with their ruthless move towards complexification (which makes it much easier to lie to others and to oneself).
But when you say:
[quote="John"]If it were just up to the Boomers, then it wouldn't have happened, since hardly any Boomer could create a residential mortgage backed collateralized debt obligation if his life depended on it. [/quote]
I do not think that this is a valid hypothesis, as many engineers behind these products were/are baby boomers. Actually, many, if not most, of the engineers behind this giant ponzi fraud that we are still witnessing are baby boomers.
Examples:
Joseph Cassano of AIG
Ira Wagner of Bear Sterns
Just to name a few.
And yes, I could not agree more, when you say:
[quote="John"]And incidentally, it doesn't just depend on the particular securities of our time. [/quote]
Yes, for example, CDOs existed in the 1920s, they just carried other names.
But I would like to point to the following:
Are the Generation Xers with their flaws largely a product of the tone that we set, when we were dominant. I just want to say:
[quote="Gordon Gekko, Wall Street"]Greed is good.[/quote]
[b]John, as an expert, what went wrong in the handover between post-war generation and the baby boomers?[/b]
Also, I suggest the following read:
[url]http://ilene.typepad.com/ourfavorites/2011/03/the-inimical-inflation-kind-.html[/url]