Curse of Interest

Reason of world economic Meltdown?

If you ask a banker, economist or a politician the reason for this recent and continue world economic meltdown the answer unanimously will be “irresponsible lending to real estate sector” however the real reason of this economic crises or any in past or if any in future is same but surely it is not the real estate sector. 

How is our Financial System ?

From centuries the people have been blinded with the curse of interest. The truth is that the global financial system is simply crumbling. This is the horrifying truth whether we like it or not and it is only due to man made financial systems that this financial meltdown has occurred.

Action of US Government.

The situation has worsened so much that the US government has undertaken laudatory steps to save the financial sector from total collapse. The Senate and the House of Representative have approved the $700 billion bailout plan by Treasury Secretary Henry Paulson.

What are the Fault of  Current Financial System?

It proved again that no matter how good finance people might be, man made financial system can also crumble. A recent report shows that amidst this crisis, American International Group Inc spent $440,000 on a posh California retreat for its executives, complete with spa treatments, banquets and golf outings, according to lawmakers investigating the company's meltdown. AIG took $85 billion loan from the government in order to stave off bankruptcy. It is sad to hear that people still do not learn from mistakes. How could a bankrupt company send its executives to resorts for fun? Will we ever take any didactic lesson from this incident?

Why these financial institutions face Bankruptcy ?

Financial systems all over the world are more or less the same. Banks and financial institutions trust each other and therefore, easily lend to each other without much concern. They lend money with confidence. But when this confidence, which is nothing but faith, breaks down, banks stop lending to each other. This is exactly what is happening now.

The most crucial thing destructing  today's financial system ?

The financial system is not sure who holds what in terms of the toxic mortgage assets and are therefore suspicious of lending to each other. But we all are missing the main point. We all fail to understand the most crucial thing that plays a vital role in the destruction of today's financial system. It is due to nothing but the interest that banks implement on the borrowers. No one is talking about the curse of interest that is destroying the leading financial institutions of the world. As long there exists high interest rates.