Against the tide

Personal Finance: Hudson City provides model for financial institutions in the current crisis | David Bahnsen

Handout

(Note to readers: This article is intended solely to provide readers of WORLD an example of fiscal responsibility in these otherwise irresponsible times. The author has not analyzed Hudson for investment purposes, and this article is in no way an investment recommendation or solicitation.)

Martin Luther made famous the image of a drunken peasant who, according to Luther, "climbed up on one side of the horse only to fall off of it on the other." The point the famed reformer was making is that it does us no good to move from one extreme if we are only going to land on another.

In evaluating the current credit crisis, some believe the entire mess is the fault of Washington, D.C., and some see it entirely as the fault of Wall Street. The truth is probably found right on the "top of the horse," where a fair amount of blame can be applied to Wall Street (greed and incompetence), as well as to our civic leaders (poor regulation, excessive encouragement of irresponsible lending practices, and a monetary policy from the Federal Reserve that served to really saturate this whole mess). Many people have individual responsibility as well: no default on Wall Street, and no credit crunch, if some individuals did not default in obligations they voluntarily took on.