OT - Is Bowie responsible for the recession?
Posted: 14 Jan 2009 00:10I would prefer to blame Kanye West somehow, but . . .
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David Bowie is to blame for the recession and the current credit crunch, the U.K. press reports today. According to a BBC Today host, it was the Thin White Duke, Ziggy Stardust himself, who opened the flood gates for the current economic problems, all thanks to his “Bowie Bonds.” Back in 1997, Bowie issued “Bowie Bonds” as a way of getting his royalty money up front. He sold bonds of his future royalties to his fans for an immediate sum of money, figuring they’d be more patient about waiting for the royalties, plus it’d give them a stake in Bowie’s catalog.
Economically, the term for this action is “securitization.” The article speculates that banks were inspired by Bowie’s foresight and started to do the same thing, except with mortgages instead of Hunky Dory. The plan was so successful for banks that they lowered the bar on who got loans, figuring a deadbeat would be the problem of whoever scooped up the security, or the bundle of mortgages. Repeat this and multiply it by several thousand and you’re faced with one of the main reasons for the current recession.
We asked a friend of ours who works in real estate — and knows a lot more about these economic matters than we do — and he insists that “securitization” was taking place on Wall Street way before David Bowie masterminded his supposed scheme to cause a worldwide recession. In fact, the practice dates back to the 1970s, when “the U.S. Department of Housing and Urban Development created the transaction using a mortgage-backed security.”
In short, our Wall Street source says, “There is no chance in hell that David Bowie inspired banks to package loans into securities, have rating agencies rate them AAA blindly and sell them off to high leverage hedge funds.” We don’t know what any of that means, but it takes the blame of Bowie’s shoulders. Blame Bernie Madoff instead or something. Plus, keep in mind, the accusations against Bowie were printed in the U.K.’s infamous Mirror, proud authors of articles like “Michael Jackson is dying” and “Student puts her virginity up for auction.”
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David Bowie is to blame for the recession and the current credit crunch, the U.K. press reports today. According to a BBC Today host, it was the Thin White Duke, Ziggy Stardust himself, who opened the flood gates for the current economic problems, all thanks to his “Bowie Bonds.” Back in 1997, Bowie issued “Bowie Bonds” as a way of getting his royalty money up front. He sold bonds of his future royalties to his fans for an immediate sum of money, figuring they’d be more patient about waiting for the royalties, plus it’d give them a stake in Bowie’s catalog.
Economically, the term for this action is “securitization.” The article speculates that banks were inspired by Bowie’s foresight and started to do the same thing, except with mortgages instead of Hunky Dory. The plan was so successful for banks that they lowered the bar on who got loans, figuring a deadbeat would be the problem of whoever scooped up the security, or the bundle of mortgages. Repeat this and multiply it by several thousand and you’re faced with one of the main reasons for the current recession.
We asked a friend of ours who works in real estate — and knows a lot more about these economic matters than we do — and he insists that “securitization” was taking place on Wall Street way before David Bowie masterminded his supposed scheme to cause a worldwide recession. In fact, the practice dates back to the 1970s, when “the U.S. Department of Housing and Urban Development created the transaction using a mortgage-backed security.”
In short, our Wall Street source says, “There is no chance in hell that David Bowie inspired banks to package loans into securities, have rating agencies rate them AAA blindly and sell them off to high leverage hedge funds.” We don’t know what any of that means, but it takes the blame of Bowie’s shoulders. Blame Bernie Madoff instead or something. Plus, keep in mind, the accusations against Bowie were printed in the U.K.’s infamous Mirror, proud authors of articles like “Michael Jackson is dying” and “Student puts her virginity up for auction.”
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