Madam, - James Doorley (March 20th) is partly correct in his analysis of the current crisis in financial markets. However, there are more culprits than he identifies.
Clearly, reckless lending is at the root of the crisis. But I am not convinced that all sub-prime borrowers are without blame. Many borrowed recklessly and provided false information (which was not checked) in order to obtain loans. Gullible banks bought loan books without proper due diligence. There are also claims that some unscrupulous investors manipulated share prices by spreading rumours about banks.
As well as the honest borrowers who have lost their homes, the other losers in the crisis are people with pension funds and savers generally. Pension funds have suffered serious diminution in value as a result of this crisis. Savers are facing a period of very low returns as central banks drive interest rates down in an attempt to stave off a recession.
Mr Doorley is correct in highlighting the fact that senior executives in banks which created this mess are departing with golden handshakes. They should be dismissed without compensation. I can only hope that those involved in share price manipulation are jailed and their companies fined heavily. - Yours, etc,
SEAN HIGGINS, Rathfarnham, Dublin 16.
Madam, - If you were to flick through the letters received in the aftermath of the technology bubble bursting in 2001, would you uncover similar themes to those in letters I have read in your paper over the past few days - unscrupulous executives of big investment banks making fortunes at the expense of honest, hard workers; rabid capitalism shattering the fabric of communities as people lose everything; and a grim economic outlook as correcting asset prices lead to job losses and general misery.
The unpalatable truth in the recent turmoil is that we - yes, the ordinary, hard-working Joes - are as culpable as top executives and capitalism. We applied for the overstretched mortgages to buy ridiculously inflated houses, we upgraded the car to compete with the Joneses next door and we maxed the credit card to buy the 42-inch plasma screen TV.
Interest rates may have been low and banks may have loosened their lending criteria, but we - the insatiatable consumers - hoovered up the available credit.
It is human nature to blame others for our misfortune but the reality is that we must take responsibility for our part in all of this. We can count ourselves lucky that global liquidity is strong, long-term interest rates are low and capital can move more freely around the globe than at any time in history.
It is highly unlikely that we will return to 1979 conditions - 15 per cent inflation and 20 per cent interest rates - but we should at least acknowledge our own parts in this bursting credit bubble and stop whingeing and blaming others. - Yours, etc,
MARK HENDERSON, Navigation Road, Mallow, Co Cork.