The credit crunch

What an amazing, incredible and ridiculous situation we are now in, caused by unbelievably greedy people who the rest of the world had grown to trust almost blindly for the peace and security of their personal and business finances.

The Queen of England recently wondered why and how is it possible that such a huge catastrophic mess could not have been foreseen by the people strategically placed just to ensure that this type of situation doesn't happen?

Now what has happened has happened and governments all over the world are pouring trillions of various currencies into their economies, trying to support and remove the bottleneck and mistrust that has been brought about by the unashamed gamblers of the financial world.

This mess was created by irresponsible people selling financial packages to other irresponsible people who didn't even know or check what they were buying with other people's money .The end result was, surprise, surprise, the amazing mess that is causing such hardship to the ordinary man in the street.

Because of the euphoria of well-being created by the financial world, the ordinary people, in many countries (thank goodness, not in Malta) were bombarded with amazing mortgage deals for their homes. Credit cards were thrown at every one, no matter what security they possessed. Deals on goods were offered to everyone to pay over a long period irrespective as to whether in five years' time or whatever they had the money to pay for the items they purchased. Why? Because the lending establishments needed the interest they received to pay out on the ever-increasing mounds of money deposited in their banks. Many, many of these loans proved to be absolutely worthless and, added together, we have today's unfortunate result.

Ok. Enough of the past. We all know the vast problems resulting from greed and irresponsibility. But what is happening now? Amazingly, the same people are still out there and still causing chaos.

Governments have poured billions of euros into the banking system; which caused the mess in the first place, with the object of getting the economies moving again. However, surprise, surprise, the banks do not trust each other and, therefore, will not lend money to each other and they will neither lend to ordinary businesses, which desperately need regular loans to survive.

Due to their irresponsibility and amazing recklessness, some major banks got themselves and the rest of the world into enormous trouble. Governments bailed them out with billions of euros in tax payers' money and, yet, they are still not allowing the world's businesses and life to return to normal. (Thank goodness for our banks, which acted with a lot more common sense.)

Now, with all the money being poured into the world's economies, and the various governments guaranteeing that banks will not be allowed to go bankrupt, you may ask why are the world's economies going into recession.

Let me tell you what I believe is the main reason.

The main reason, apart from the attitude of a lot of the people who still control the financial and banking sectors of the world, is the fact that we are all being told, every minute of the day, that the world's economies are going into recession.

Listen to and see what practically every news station and current affairs programme anywhere on the planet is saying and showing. Experts are all predicting doom and gloom. Probably the same experts that caused the problems in the first place by advising clients on financial affairs that went so horribly wrong.

They are saying that things are going to get worst before they get better. These "experts" also predict the actual dates when they think all will be better.

Sky news and others are telling everyone that people are not doing any shopping and are not purchasing things they would normally purchase to keep the economies moving. People are told that everyone is saving money as they might not have a job tomorrow and, guess what, once again people do not buy so much, thus causing problems in shops and in some cases massive closures.

It would be better, in my opinion, if these programmes just stopped creating confusion and became a lot more optimistic, thus giving people confidence to go out and spend as usual.

The world media has a lot to answer for with regard to the present situation. They must be much more responsible in order for the markets to stabilise. Creating panic causes panic. Suggesting normality brings about calm and normality. I hope that, whatever happens in the future, the people involved in the financial and media world understand this.

The people who caused the problems we face today are financial gamblers. If gamblers lose, they normally lose their own money, therefore it is their personal problem. These financial gamblers, risked money that was not theirs and when they lost, due to greed and stupidity, they lost money that did not belong to them. That in my book is criminal.

Christmas is gone. A new year has started. Let the world and, especially, our little country, look to the future with confidence and act responsibly and calmly. By doing so we can quickly brush the chaos aside, start afresh but still, hopefully, keep a watchful eye on what is happening around us.