Buying Banks

The most recent stock market crash will forever be remembered throughout history for being the largest drop in stock; even greater than Black Tuesday in the 1930’s.  Who would have guessed that something that large could ever happen again.  Hopefully, we will not experience such a devastating depression as there was in 30’s.  As a result of the crash, the government has decided to bailout the banking sector of Wall Street.  Good move? Not so much.  In reading a commentary article from economics lecturer, Jeffery A. Miron, from Harvard University, I discovered much more about the future implications from the government economy patch than I had realized. Those who plan to keep their money in banks should be concerned with just who will be making decisions about their money, because the future of our country is at risk. 

The bailout, to those who only see the surface, seems to be a great fix for an economy that is failing.  At first, I was this person.  Luckily, my economics class has intrigued me to look further into just what will result from the government bailout. My eyes have been opened.

Jeffrey Miron explains that the government, in an effort to help an ailing economy, is planning on buying stocks from banks in order to help banks increase lending, and thus “minimizing the chance of a recession” (Miron).  On the surface, this seems like a favorable idea. People see quick surface results for a big problem.  But what most people do not realize is that the government of the United States will become a significant stockholder in banking, and thus a big decision maker for what will happen in the future.  As scary as this may sound, it is now a reality.

What does this mean for the future?  The Government will be able to control banking decisions based on party beliefs, not what is best for the economy.  Miron goes further to explain that there is no guarantee that the government will relinquish its holdings once the economy is better, as they so claim.  “This is crony capitalism, pure and simple” (Miron).

It was this line that caused concern.  Our government has found a way to gain more control over its citizens than it should have.  As more and more people realize this, will they lose their faith in banks and refuse to use them?  Without a way to enforce the government’s relinquishment of stock, will it follow through as it claims?  All of this uncertainty will cause people to possibly not use banks, making it harder for stability to be reached.  What appears to be good for the economy immediately will only cause more problems down the road.

Thus, what can be said for the new government bailout?  It is a temporary fix that could lead to even greater problems in the future.  Principles of economics state that the market will take care of itself without intervention.  Unfortunately, the government now has greater control of decisions made with citizens’ money, and thus, potentially, greater control of our lives.  Adhere warning because the bad might just get a whole lot worse.

http://www.cnn.com/2008/POLITICS/10/14/miron.banks/index.html

A Growing Experience

On my way to the Umphree Lee Dining Hall on September 24, 2008, for a bite to eat after a long and exhausting chemistry class, I happened to catch a glimpse of a headline on the cover of The Daily Campus that read, “Taking a year off.”  My curiosity for the topic, given I had taken a year off between high school and college, drove me to investigate further.

The article by Sommer Saadi described how there is a growing interest among students who decide to take year off from school, and some of the advantages from it.  Some advantages include a year’s worth of experience living in society, and a better understanding for the world around them without the demands of school.  In addition, students hopefully will be able to narrow their decisions about intended career paths and gain a better appreciation for the maturity and responsibility that comes with being an adult.  This comes at an important time given that tuition for college continues to get more expensive, and students are taking longer to finish their undergraduate degrees.  The year off can certainly help undecided students narrow their interests without the cost of more semesters of college to do the same.  Karl Haigler, co-author of “The Gap Year Advantage” believes that the year can have quite an impact on attitudes of students, including behaviors and skills.  Students will have a better appreciation for what life will demand from them, and thus will hopefully have a greater focus when they return to school.  In my opinion, these statements could not have been more correct in my case.

Upon my graduation from high school in 2007, I made the decision to take a year deferment from Southern Methodist University to pursue personal interests.  What I was about to undertake was, without doubt, one of the greatest maturing experiences of my life.  The summer of 2007 was very important because I was the frontrunner for the presidential position of an international 31,000+ member youth organization called the American Quarter Horse Youth Association.  If elected, my duties would take me around the country, and potentially world, visiting enthusiastic youth members, bolstering excitement for new programs, and representing the American Quarter Horse Breed.  In June of that summer, I was fortunate to be elected president.  For one year, I travelled the country, talking to youth interested in horses, carrying out nation-wide community service projects and ultimately, gaining the experience of a lifetime.  As I look back now, the experience in communication skills and maturity that I obtained from my deferment were worth every minute away from the classroom.  I made connections with people from all over the world.  However, my activities for the year did not solely include the Presidency.

Ever since I was born, I have grown up on a farm with horses.  My passion for competing began early as I got my start at state 4-H competitions, riding and showing.  In 2000, I began to train and ride with a quarter horse trainer from Indiana.  I broadened my competition horizons to now national quarter horse events, a different league of competition from 4-H.  For 8 years I competed as a youth, building a hard-working reputation as a great showman.  Upon taking a year off from school in 2007, I also made the decision that I was going to hold a job in the time that I was not fulfilling duties of my presidency.  I was hired as assistant to my trainer, riding and breaking horses for clients from all over the country.  7 days a week from 8 in the morning until well beyond 5 in the evening, I was riding horses, travelling the country for shows, giving lessons, and fulfilling my love for the sport.  In my position, I learned how vital responsibility is throughout your work.  Driving a seven-horse trailer across the country with close to, if not over, a million dollars in value of horses demands nothing less than your full attention and maturity.

My experience with the gap year was not about whether or not I wanted to become a horse trainer, but rather a lesson in growth and maturity that will only further my development into an adult.  It helped me to gain experience in communication, and make connections with people from around the country that I can use later in life.  To me, the benefits I gained are now greatly vital to my success as a student.  To anyone considering a year off, I would strongly recommend this alternative.  The experience and practical skills I acquired have helped me realize the importance of staying committed to my studies in school when distractions are so prevalent.  I am glad that The Daily Campus has published this piece so that more students consider this alternative that will only help them in the future.

http://media.www.smudailycampus.com/media/storage/paper949/news/2008/09/24/News/Taking.A.Year.Off-3448504.shtml