Wes Kelley

Mint.com is a very handy and easy to use personal finance manager that has won my heart.  Beginning last January, I dumped Quicken and went exclusively to Mint. (Not to be outdone, Intuit, the maker of Quicken, has now bought Mint.)  The addition of an iPhone app and other modest improvements over the last year has given me confidence in my decision.

Mint recently posted the following on their blog.  Just like I love graphs, I love infographics of any kind. This summary of charity shines a light on the importance of doing good with what we’ve been given.

Mike Mandel has put together a collection of graphs that he thinks sums up the Great Recession.  An analyst for Atlantic magazine has suggested that the following graph from the St. Louis branch of the Federal Reserve sums it up best.  This graph shows the skyrocketing of household debt.

There is no doubt that our recent economic tumult will supply countless grad students with ample material for master theses and doctoral dissertations for years to come.

I won’t pretend to understand all the nuisances of the financial sector meltdown, but it is shocking to hear terms like “socialism” and its close cousin “nationalized” returning to polite and intelligent conversation.  Jack Shedd pointed out this post from Willem Buiter of the Financial Times where he suggests that maybe we should stop kidding ourselves and just nationalize our banks (the FDIC, Fannie Mae and Freddie Mac being part of the joke).  

If financial behemoths like AIG are too large and/or too interconnected to fail but not too smart to get themselves into situations where they need to be bailed out, then what is the case for letting private firms engage in such kinds of activities in the first place?

There is a long-standing argument that there is no real case for private ownership of deposit-taking banking institutions, because these cannot exist safely without a deposit guarantee and/or lender of last resort facilities, that are ultimately underwritten by the taxpayer.

Alexander Hamilton created the first Bank of the United States to encourage financial stability, shore up our currency and develop a source of credit for our cash-starved country.  Perhaps what was old will be new again.  Sadly, it is hard in this circumstance to know what is the frying pan and what is the fire.

Congress wanted people to own their own houses, so they created Fannie Mae and Freddie Mac to inject money into the system. These institutions were allowed to capitalize on their mortgages and inject ever increasing amounts of money into the housing market. With all that money chasing houses, the prices went up to where people could not afford a house. Enter junk quality loans. The bubble was inevitable.

Quote from Dr. Jerry Pournelle