Under the rainbow: capitalism/the subprime mortgage crash

May 9, 2010 § Leave a comment

One Sunday afternoon some years ago, run down with life, I fell asleep watching a football game, the game itself a low-scoring grind in which I had little interest. When I woke the game was over and I was looking instead at two gentleman, not tall at all, both gracious and reassuring, showing me their yacht and cars and palatial home, which dwarfed them, telling me how easily I, too, could have these things. They had to have been the Rice twins, John and Greg, and what I was watching was an infomercial hawking the Cash Flow Generator, a scheme to cash in on the housing boom, though specifics were never mentioned I suppose because that would have dispelled the magic. I was still groggy and in a mood, like all of us then, to be entranced. I thought I had awakened on the other side of the rainbow. I have a very modest income from teaching and live in a rental in Silicon Valley, one of the most expensive places in the country. Obviously I had done something wrong to be in such a position, but watching the twins I felt the problem wasn’t that I didn’t work hard enough or hadn’t made the right decisions in life, but that I was just being obtuse. There were real opportunities out there and all I had to do was make a simple call. For it was the time of our other national pastime, flipping houses, and seeing the twins was one more piece of evidence confirming my suspicion we weren’t in Kansas anymore.

A few years later, we were all looking at the other side of this curve:

The Dow Jones.

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