There's no doubt that the credit crisis is hurting manufacturers both small (record numbers of small business owners citing the uncertain economy as a business challenge) and large (even the mighty GE is feeling the pinch). Economic anxiety is at an all-time high, while stocks and retirement accounts are breaking records in the other direction.
Recently, an interesting campaign started up that attempts to pin the blame for the credit crisis on affordable housing programs for first-time and minority homebuyers.
Nonwithstanding the fact that this type of scapegoating in anxious economic times smacks of 1930s Germany, it's just not true. (But really, when has that ever stopped Neil "Civil War in Iraq is a good thing" Cavuto from saying anything before?)
I just read a McClatchy news service story that lays out the current argument, then uses things like logic and actual Federal housing data to knock the straw man down.
Here's the lede:
"Federal housing data reveal that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis."
In short, it was the holes in regulation that allowed for the really smart guys in big finance to get creative. These guys shouldn't be allowed to get creative. These guys should have their right brains lobotomized.
And as the son of an engineer, if I hear one more reference to the criminal activity they're now calling "financial engineering," I'm going to grab the nearest investment bank CEO and punch him in the face. (Seriously, click that last link -- it's a keeper.)