Having worked in the mortgage department of a bank, I found this episode too realistic to be particularly amusing as poor Homer Simpson has once again gotten himself into trouble. After throwing an overly extravagant Mardi Gras party, he is asked by a friend how he can afford it. Homer replies by saying, “I got this magical thing called a home equity loan. I borrow all the money I want, and the house gets stuck with the bill!” No sooner does he finish his conversation when Marge receives an envelope in the mail stamped “Warning—your adjustable mortgage rate is about to reset.” When they go to see their mortgage broker, he reads them their charges off a computer screen. “Balloon payment…37% interest compounded every minute, not understanding the contract fee….oh wait I left out a zero.” When the family can’t afford the mortgage and their house is foreclosed, the banker tells them, “Don’t blame the bank…we fired our CEO and he barely got out with 50 million dollars!”
Though somewhat exaggerated, this exact situation is happening all over the country today, and it's a shame. People are spending more than they can afford, especially in the midst of this economic crisis, and they are forced into bankruptcy. And, as I have realized in my finance classes, it is partly because of the uneducated people like Homer Simpson that the country is in a financial crisis in the first place. Banks have made the mistake of loaning subprime mortgages, and even HELOC’s, to people who simply cannot afford them. What’s more, those same customers are taking out extra loans that they will never realistically be able to pay back. It is a huge problem in our economy today and I thought it was somewhat insensitive for the creators of The Simpsons to actually poke fun at the situation; especially when Homer was found hanging himself in the backyard. I did, however, enjoy that they added the comment about the CEO being fired from the bank with only $50 million, as another huge issue is the fact that banks are being bailed out, and then taking that money to offer bonuses to their executive officers.
Needless to say, the Simpson family is saved by their faithful neighbor, Ned Flanders; however, the problems in the episode are unfortunately not so easily solved in real life.
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I found this episode much like you did. Of course it would be Homer Simpson to be the someone that would keep taking out money on his sub prime mortgage. It is all the uneducated people like him that is the reason we are in such a horrible financial crisis, but it is even more the fault of the bankers for just allowing all of this to happen. You think that someone could have been able to stand back and say that giving this money out and expecting people to pay it back with unheard rates is unethical, for them as people asking for the loan, and for us as a business.
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