In the midst of the “subprime” mortgage “crisis,” it pays to remember the biggest losers are the investors who put up their own money so poor people normally considered “un-creditworthy” could actually get a home mortgage. One of those fellows who found that “no good deed goes unpunished” was Michael Lewis, who draws some lessons at Bloomberg.com:
2) Poor people don’t respect other people’s money in the way money deserves to be respected.
Call me a romantic: I want everyone to have a shot at the American dream. Even people who haven’t earned it. I did everything I could so that these schlubs could at least own their own place. The media is now making my generosity out to be some kind of scandal. Teaser rates weren’t a scandal. Teaser rates were a sign of misplaced trust: I trusted these people to get their teams of lawyers to vet anything before they signed it. Turns out, if you’re poor, you don’t need to pay lawyers. You don’t like the deal you just wave your hands in the air and moan about how poor you are. Then you default.
3) I’ve grown out of touch with “poor culture.”
Hard to say when this happened; it might have been when I stopped flying commercial. Or maybe it was when I gave up the bleacher seats and got the suite. But the first rule in this business is to know the people you’re in business with, and I broke it. People complain about the rich getting richer and the poor being left behind. Is it any wonder? Look at them! Did it ever occur to even one of them that they might pay me back by WORKING HARDER? I don’t think so.
But as I say, it was my fault, for not studying the poor more closely before I lent them the money. When the only time you’ve ever seen a lion is in his cage in the zoo, you start thinking of him as a pet cat. You forget that he wants to eat you.
Read it all at the link above. It’s a hoot. You gotta admire a guy who takes a beating and shrugs it off – sort of like the Black Knight in Monty Python and the Holy Grail.
Thanks to Instapundit for finding this column.