# Brown bets the house…. But there is a better way!

- Link: https://fundraising.co.uk/2008/10/08/brown-bets-house-there-better-way/
- Published: 2008-10-08T20:30:24+01:00
- Author: Howard Lake

Well not his house, but maybe yours and mine. The only good news I can see is that
interest rates are falling by 0.5% – not enough but on their way.

Why is this such good news? My simple take is to blame Ben Benanke of the Federal
Reserve for the whole fiasco. Sub-prime mortgages were quite repayable when originally
sold as they were based on historically low interest rates, but Ben put them up 
three times in quick succession; so making it impossible to buyers to pay back their
loans and they defaulted en masse.

The reason there was no quick correction was because the current system of financial
over-sight is welded to not increasing inflation; which requires interest rates 
to rise at times to choke off demand. Once you weld part of the financial systems
checks and balances chaos ensues.

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So today’s orchestrated fall in rates, if pursued further over the next few days,
will allow some sub-prime payments to flow again and steadily reduce the poison 
in the system; which fat cat bailouts don’t achieve.

Lastly does anyone else feel the fundraising proposition “only £2 a month” reminds
them of sub-prime mortgages? With the lottery offering lower jackpots due to punters
feeling the pinch, maybe some charities investment may not pay-off at upgrading 
time?

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