Forum Post: Thoughts about Debt Chains

Money that is borrowed from one to the other, from the other to a further one and so on causes a mulitple of its initial amount as liability.

If this money gets lost in the end of the chain suddenly the multiple of the amount is missing in the whole chain, even if no real money else got lost than the smaller initial amount.

A bail out that always at least saves the root of the chain needs always only the replacement of the initial amount of borrowed money, no matter where in the chain it is put. But where it is put chain upwards the liabilities are resolved and downwards they remain and lead potentially to bankruptcy. How many stages of the chain are saved has nothing to do with the volume of the bail out, that must always be the same, it has only to do with the place in the chain where it is provided.

This means in the mortgage crisis: With the SAME amount of money the US government could also have saved not only the banks but all the middle class families who have become or become now homeless. No Dollar more was needed for this. The bail out had just to be placed in the end of the chain directly to the owners of all those houses: This means, regardless of what they are telling, they were consciously ruining the life of ten thousands of middle class families by putting the money directly to the banks and not to the end of the debt chain!

How can you trust in such a government anymore that ruined the life of so many middle class people without need? They must be too stupid to govern or more probable be really evil ...

So far we did to little think about this! I think this is the real scandal about what was done by politics in this matter.