Sunday, 25 July 2010

Even the crash makes work - pointless work - for people to do

Prof Niall Ferguson's TV programme, The Ascent of Money is being shown again on TV at the moment. In the first episode, he shows how the poor people of Memphis are loaned money to buy a car, but they can't afford to pay back the loan so the loan is 'restructured' and the car repossessed and put back on sale possibly in the same dealership that sold it to the first hapless customer.

The people restructuring their loans go to see lawyers, who are in effect paid to change a subprime loan that should never have been made by the bankers, into a loan that has some prospect of being paid back. There's also work for auction houses selling the same cars over and over again as they cycle round from individual to bank to auctioneer, to car dealer, to individual ...

Nothing productive, nothing worthwhile, all just games with money, moving cars around physically, nd admin as the 'title' to the car changes hands.

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