Over the past several days, America has watched the pandemonium occurring as a result of banks and other financial institutions failing. The dust has not had time to settle, yet the finger pointing has already reached a fever pitch, and the politicians have seized every opportunity to incorporate the issue into stump speeches, and to even blame those currently running for office.

Now I am just a simple man, with a simple life. I have a home, with no outstanding mortgage payments on it thank goodness, a decent job with long term prospects, and both my wife and I have investments and 401k's that we monitor on a weekly basis. We are among the middle income Americans that politicians speak of.

As a simple man, I don't pretend to know everything there is to know about investing or how how banks operate. I can't sit here and pass judgment as to a clear and precise reason why those at the helm of our financial institutions, have failed to do what they should have been doing to prevent what is playing out in front of all of us.

I think it's clear to all that the current mortgage crisis is at the core of all of this, probably because it is almost always raised as a factor in all of these stories. It's also crystal clear to me that there is not one person, nor one institution responsible for a rise in defaults in mortgages. There are many reasons why this has happened. And I don't care who points their finger at someone else, the fact is that from the poorest American to the richest politician, we all share some blame in one way or another for what is now plaguing this nation.

Some things are simply common sense when it comes to what has led to all of this. Some of these things defy explanation.

Americans as a general rule live way beyond their means. We like easy credit. We like loading up credit cards and taking out loans for purchases of goods that more often than not, will be defaulted upon should something disrupt our flow of income for any period of time. That can be for some, a few months. For others, it might only take a week without pay to start money woes. People rarely plan for those rainy days. Savings accounts are at an all time low in this nation.

When it comes to the banking industry, it is no secret that the more money that a bank can loan, the more potential profit they can make. Mortgages represent the lowest and more prolonged rates of return, and of course it's easy to understand why banks don't want to to wait out thirty years to reap the harvest. So in 1938, with the stock market crash barely behind us, a governmental agency was created and named the National Mortgage Association of Washington. It was renamed to Federal National Mortgage Association, or what we now know it to be referred to as "Fannie Mae". Before it was allowed to be privatized by Congress in 1968, the US government owned a corporation that bought FHA and VA mortgages on the secondary market, pooled them, and then sold them as "mortgage-backed securities" to investors on the open market.

In 1970, the Emergency Home Finance Act was created to provide a new secondary mortgage buying entity. It was named the Federal Home Loan Mortgage Corporation, which we now refer to as "Freddie Mac". It was born to provide secondary mortgage support for conventional mortgages originated by thrift institutions. Freddie Mac was also allowed to buy conventional mortgages in addition to FHA & VA. Believe it or not, this was done to supposedly create competition for Fannie Mae, since they held what was viewed as a "monopoly" in the arena of buying mortgages and selling them as investments.

All hummed along well for the next thirty years or so, because there were standards and requirements that still had to be met in order to obtain mortgages, and they were documented very well. For sure, there were defaults on loans, and there were foreclosures. Bad things happen to good people and they sometimes just can't recover from those bad things. And the rates of default never got out of hand.

In 1999, Bill Clinton signed a piece of legislation that may well have contributed to the housing crisis. The Gramm-Leach-Bliley Act, also known as the Gramm-Leach-Bliley Financial Services Modernization Act was instituted, repealing the Glass-Stegall of 1933. Never heard of either of these regulatory rules? Most people haven't.

The Glass-Stegall Act was put in place to prevent the EXACT issue we are facing today. It was specifically instituted to prohibit banks from offering investment, commercial banking, and insurance services. The Gramm-Leach-Bliley Act allowed commercial and investment banks to consolidate with other investment institutions. It also legitimized and rubber stamped the previously illegal act of banks being allowed to offer stock and insurance brokerage services. These were already occurring prior to the signing of Gramm-Leach-Bliley, but were done very low key and without fanfare, because they were technically illegal. In 1998 Citibank began a merger with Travelers Group, an insurance company, now known as Citigroup, creating a corportation that combined banking and insurance underwriting services. Gramm-Leach-Bliley allowed a previously prohibited merger of this kind to be completed.

Another large piece of the blame pie belongs to those lending institutions that jumped on the "ARM" and the sub-prime loan bandwagon. Adjustable rate mortgages, more often than not are totally misunderstood by those that sign for them. People previously denied a home loan will jump when the means in which to own a home is dangled in front of them. Be it not being given all the details, or simply refusing to consider the implications of an ARM, the fact remains that these kind of loans represent almost 43% of the current mortgages that have been foreclosed upon. There is equal blame to be shared by those offering loans to those who cannot afford them, at any interest rate. Sub-prime loans, given to those with checkered or no credit histories, at higher interest rates, are a reckless proposition, especially when we are talking of what can often be hundreds of thousands of dollars at a time being handed over to sellers of property.

And let's not leave mortgage brokers out the mix either. Imagine if you will, loan officers at banks approving mortgages submitted to them for approval, without the loan officer being given all the facts. Mortgage brokers are estimated to originate nearly 70% of all home loans in this country today, and they do not get paid a dime for their documentations if the loan is denied. So of course, it's easy to imagine that financial figures were manipulated in order to get loans shoved through that otherwise would be denied. It's inevitable.

And last but not least, the bundling of these loans and offered as investment opportunities on the stock market is a recipe for disaster. All of this is similar, if not completely repetitive of what led to the stock market crash of 1929.

I don't like to see financial institutions fail. I don't like to see people lose jobs. But what I like even less, is for the Government to bail out these greedy, and haphazardly run companies, who have over the years made billions of dollars off the backs of the working men and women of this nation,which will only lead to more of the same kind of business to resume once the dust settles.

I don't know if this is about to come to a conclusion or not. We may be in for more of a wild ride on this roller-coaster to nowhere. But what I want to see happen, is to bring to justice ALL of those responsible for this mess, and to impose strict regulations again on what banks are allowed to do in the course of seeking to make a profit. Politicians share a great deal of responsibility each and every time they respond to lobbyists and cash contributions to relax standards that were imposed to prevent this crap.

And as for the common people in this nation, it's high time we all took a little responsibility for our own financial futures. Cut up the credit cards. Put back some money for the hard times. And if you want to have a home of your own, save up the cash to pay down on it, and get a traditional loan through an institution you know and trust.

Personally, I detest corporate banks and I will not go near one of them for so much as to get some cash from one of their ATM's. I like small town banks and I absolutely love credit unions. They've never let me down once when I needed them.

Unfortunately though, my 401K is rather screwed at the moment. So I guess they've got me by the short hairs after all.

What A Week!!

The conventions are over, and the race for the top spot is well underway. There is much confusion however, as to who exactly is running for President, after seeing the Republican convention, at least the way I see it.

We were not only introduced to John McCain, we were entertained with the spectacle of meeting Sarah Palin, who made it a point to join in bashing Barack Obama almost immediately in her speech. Am I alone in finding it a bit offensive that she did this, given the fact that she is much like the new kid on the block? You'd have thought she would at least wait until she was familiar with the neighborhood and accepted first. Of course, those who squarely find themselves Republican found this to be acceptable of course. But really, who is this woman, and what right does she have acting as if she has been on the national scene for years, and why would she go on the attack so soon after being shoved to the front of the political line?

If this were not bad enough, we were introduced to the baby daddy of the daughter of the veep pick, who most certainly by now has some pock marks underneath his clothing, from the rifle barrels being used to persuade the young man to do the right thing.

I'm really confused. For as long as I can remember, the ultra-conservatives have been the ones to push abstinence as the best way to prevent teen pregnancy and pre-marital sex. Here we have a woman who is rushed to the forefront of politics, who pushed for exactly that same solution spreading performed within schools in her home state, and now she is parading her knocked-up daughter on stage along with the reluctant father in proud fashion, and forgive me, but I find it quite odd. Don't get me wrong. This kind of thing happens quite more often than one might think, but to make a spectacle of it in front of the American people is a bit too much.

I don't think for a second that John McCain knew about this little family dilemma prior to selecting her as a running mate. I see all of this parading on stage as a weak and pathetic attempt to do damage control. It might make me feel as if Sarah Palin is indeed a bit more normal and able to relate to average Americans out there, but it certainly doesn't make me want to feel the conservatism that she is wearing on her sleeve.

For months, the right wing folks have made immense fun of people that are mesmerized by Barack Obama and his message of change. Yet this past week, you'd have thought that Sarah Palin was running for President, rather than the man who invited her to be on the ticket. I've even wondered if she actually knows that she is not running for President. The radio talk show hosts have all but drank her bath water, in their absolute fawning over the prospect of her becoming the veep.

And what, if anything came from the week of speeches and messages emitted from the Republican nominee? He has now adopted using the word "change" to describe his intentions if elected. He introduced Sarah Palin as the person most likely to help him achieve changing Washington. I don't see too many people falling for this newfound strategy.

Barack Obama also had something else right. He was quoted as saying that "the Republicans have had lots to say about me, but not much to say about you," referring to the American people. It's great that two people are claiming that they are going to reform the way business is going to be done in Washington, but what are they going to do, to bridge the gaps in what has deeply divided this country over the past decade or so? I didn't come away from hearing these two people speak, with any lasting impression of anything at all that would persuade me that they are doing anything at all but trying to win the White House.

McCain has been hammering away at Obama about his proposals to adjust tax rates, which he has clearly stated would not be done on those below what we all know to be lower income levels, and more importantly, those who are living from week to week on what they make. Obama knows that people making a higher than average income, should be paying taxes relevant to that income.

Now I've heard all the arguments. I've read the statistics. I know who pays what taxes. But the simple fact is that regardless of how one looks at it, the tax system in this country allows those who make more income, or who are tremendously rich, to pay or transfer the burden of taxes upon those who are least afforded a break in those taxes when times are tough.

In addition to this, there is no way to salvage the Social Security system in this nation, unless the cap is raised on income that is taxed to fund the system. We are long past the arguments as to whether it should have ever been implemented. The fact is that people have been paying into it for all of their working lives, and they deserve to draw their benefits if they should live long enough to qualify for them.

As one American who has opened my eyes to a thing or two, especially by taking the time to listen to the other side of things for a change, I think it is high time to reverse the trend of providing corporations an environment to thrive like mold in a damp basement. For decades, politicians have provided the rampant escalation of an elite few to amass wealth that most can only dream of, and to use it to influence all politicians through manipulation of election funding to perpetuate that the system that is choking the life out of this country.

If Barack Obama has proven one thing that everyone in this nation should take notice of, even if he should lose the election in November, it is that it is still possible to be President of this nation without ignoring the little people. For the most part, they have contributed in small quantities to help him achieve what was almost impossible in the eyes of many.

And he will be getting a small check from myself and my wife this week to nudge him on too. You see, I don't have the cash laying around that I once did, and I don't make as much as I once did either. And forgive me, but despite all that lingers in the back of my mind after listening to years of Republican rhetoric, I find myself believing in a man who doesn't have years in political office, nor an admirable military history that can be lauded at every opportunity for effect.

I like him because he made his way, in spite of all, to become a man who does capture the attention of people because he knows how what people relate to, and what they are going through at the moment, because he is not that far removed from it himself.