We_Won_t_Get_Fooled

							"We Won’t Get Fooled Again" (The Who)
3 Things we knew at the time – but it did us no good

First thing – the Iraq war in 2003. We knew it was a bad idea. We knew Saddam didn’t have weapons of mass
destruction; we knew that he was more bluster than action at least toward the United States; we knew he wasn’t support
Al Quaeda; we knew that invading Iraq would divert attention/resources from Afghanistan and the hunt from Osama Bin
Laden; we knew that an occupation would fail miserably.

So what happened? We invaded. Five years later, we don’t have Bin Laden; we confirmed that there weren’t any
weapons of mass destruction; we now have Al Quaeda active in Iraq where they weren’t before; we’ve spent about $500
billion with not all that much to show for it; the Taliban is active again in Afghanistan; and the occupation isn’t going that
well.

"We Won’t Get Fooled Again" – yeah, right. Second thing – during the stock market tech bubble in the late 90s, we knew it
wouldn’t last forever; we knew stocks were valued too highly; we knew companies with zero profits shouldn’t have that
high of stock prices. I had stock options in a company. When I joined them, the stock was at $40 a share. It split twice and
hit a high of close to $150. Everyone knew it couldn’t stay that high. Everyone knew it was going to crash. I cashed out my
options when the first set vested after a year at around $105; took the money, paid off my second mortgage. I mostly
cashed out as they vested after that – quarterly. I did hold off at one point, waiting for a new tax year, and the stock
dropped, so I got "only" $50 a share. But those around me – all the ones saying "it can’t last forever" – didn’t cash out.
The stock eventually hit $6 a share and they got nothing.

Was I smart? No, I’m not smart with money. But I’m risk-averse, and figured it was better to take the money and pay off a
second mortgage with a fixed interest rate than to trust the stock market. Were my co-workers smart? Yep, they were a
bright group of people. But they made horrible decisions. Although everyone "knew" what would happen – they acted as
though it wouldn’t.

"We Won’t Get Fooled Again" – yeah, right.Third thing – the housing bubble. Once again, we all knew it couldn’t last;
prices couldn’t go up forever; we knew zero down payment loans were a bad idea; we knew liar loans (where people don’t
give proof of income) were a bad idea; we knew poor people and people of color were being pushed into sub-prime loans
when they could have qualified for prime loans; we knew banks were being too aggressive on their loan practices and
were setting people up for failure.

I got lucky again – I sold in spring, 2005; moved out of the bay area to a rural town; now I just have a land payment,
because the profit in my house covered the cost of building the new house. But I was biting my nails the year before we
sold, wondering if the market would crash before we sold.

So we all knew it wouldn’t last. We all knew the bubble would pop. But again – we did nothing. Regulators didn’t crack
down on the risky loans; lenders didn’t change their behaviors; borrowers took the loans thinking real estate would always
go up.

"We Won’t Get Fooled Again" – yeah, rightBonus –

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"Only two things are infinite, the universe and human stupidity, and I'm not sure about the former. "

Albert Einstein

US (German-born) physicist (1879 - 1955)