Essay about The Current Economy is Based on Greed

3814 Words 16 Pages
The main reason that large corporations are in dire need of money is simple, greed. Financial institutions went out and found people who wanted to purchase a house, but couldn’t afford it, because of bad credit reports, debt, income, etc. So the banks went out on a limb with these risky people, and loaned them “x” amount for the house. Banks were only trying to make some money off of the outrageous interest rates of the mortgages, because that’s what banks do, they make money. Now banks and other lenders did this type of business on a large scale. People loved the idea that they could go out and get a mortgage on let’s say a four hundred thousand dollar house, with a bad credit score and slightly above minimum wage salary. Can you see …show more content…
It is really sad that some people would rather be fashionable and in debt, than be unfashionable and without debt, just because of what society looks like. People have to realize that somewhere along the lines one has to draw the line and decide whether or not this month they would rather eat have a shelter or whether or not they would rather go out and buy that new pocketbook that is in style.
Patrick wrote an article “The 2008 Financial Crisis-Causes and Effects” that explains a little about how the economy works and why the economy is where it is currently. “The American economy is built on credit” (Patrick). Now credit can be a good thing when it is used wisely, because that is how people start a business or buy a vehicle. Its sort of like trust, I guess is how I would put it. Meaning that when you go purchase something on a credit card or write a check, money is withdrawn from your account and now you have a deficit of sorts. So when you make your monthly payment on the item that you bought, you get ‘recognized’ in the banking world as being a responsible person for paying your debt. “Recent Market instability was caused by many factors, chief among them a dramatic change in the ability to create new lines of credit” (Patrick). New lines of credit include remortgaging your house and refinancing your