The president’s speech about the economy spoke volumes to regular Americans but did nothing for Wall Street. The markets are still down though people are anxious and ready for improvement.

“There’s a lot of nervousness,” said Terry L. Morris, senior equity manager at National Penn Investors Trust. “It’s a tug-of-war between the news that’s out there and the fact that the market has already gotten pounded.”

“I think the market is cheap where it is, but it seems to want to get cheaper,” he said. 

There is a shakeup going on in the market. People are doing what they want to do by spending less, not making major purchases, because they are scared. Scared that they will not have a job, and unable to get the credit they formerly did. It is not easy to do what you wanted to do without money or dwindling assets.

Ben Bernanke suggests that bad borrowers should be bailed out as well. Though I disagree with his suggestion that those who took out loans that they couldn’t afford, though they are a drain on the economy, should be assisted.

“Some borrowers presumably knew what they were getting into,” Bernanke said before the House Financial Services Committee. “But from a public policy point of view, the large amount of foreclosures are detrimental not just to the borrower and lender but to the broader system.”

On the other hand, those who could afford to repay a loan but faced some sort of difficulty along the way, such as a job loss or health issue then definitely help those who want to repay their loans. The people who were unable to repay and were high risk  borrowers should not have received loans in the first place.

As Bernanke says that foreclosures are detrimental to the broader system, this is true, but the system needs a shakeup and greater accountability on an individual lending level. If a person says they make a certain amount of money, can’t verify it and regardless of their poise, charm and wit, if they can’t repay, they shouldn’t receive a loan. Of course now we know that greed and common sense are diametrically opposed so it is a challenge for people to be responsible. If the government bails out people who took out loans that they knew they couldn’t repay or had no proof of being able to repay then this would just be rewarding bad behavior. Large corporations are being chastised for using government money unwisely, so why should individuals be held to a different standard?

The only people affected by plummeting real estate prices are the ones who bought a house that cost more than they could afford, hoping for a spike in value so they could sell at a profit or take out a new loan based on an increased value. Their home wasn’t just a place to live; it was an investment they thought they could liquefy at will. If we’re saving these poor souls from the 26.7% drop in their investment, we should give twice as much aid to everyone who has lost approximately 50% in the stock market since its peak.