Trust Precedes Confidence

  Wanna do a deal? Why not?
 
A person who contracts with a lender to borrow money to purchase a home is a debtor. He is indebted to the actual owner of the house, the lender. He is not a house-owner, a home-owner, or an owner of the property. He is the owner of an obligation, a debtor.
A person of this status -- a debtor -- is not a home owner. He is a debtor with obligations as specified in precise detail in the contract he willingly signed, thereby acknowledging and agreeing to its requirements, covenants, and rules underlying its enforcement and his obligations. Only after all his obligations have been satisfied -- including his payment in full of all interest, principle, and penalties -- might he become a home owner.

President BO has a plan that will reduce mortgage debtors' principle and interest rate. The plan rewrites the terms of these peoples' contracts.
The result of this plan is to institutionalize the frailty of the already-weakening concept of what a contract is. People -- the mass of the population -- are learning that to sign a contract is not actually as binding as it was. They are learning a "why not" approach to signing their names, promising, and committing. People are learning that they can whine, complain, proclaim unfairness on the part of any counter party in any deal. Through such behavior, people may, and likely will, escape all or a portion of their obligations. Their new government is here to help... the whiners.
People are learning this new standard of performance from the organism that occupies the Office Of The President Of The United States Of America.

The purpose of -- and the need to have -- any contract is to: 1.) Specify all aspects of an arrangement, and 2.) To ensure that all parties involved understand and will be required to meet all specified obligations.
How many people would you trust to meet the terms of a contract that you might enter into for any purpose?
How many people would you trust to make a serious attempt to satisfy the terms of a contract?
Without trust, there can be no confidence.
Without confidence there can be no market functionality. All agreements and contracts gain a questionable aspect and become essentially unsecured.
How many people might you trust enough to do a deal with today? Even if they signed a contract and swore on the bible...?
There should be no surprise at, nor wondering why, capital markets, real estate markets, and personal relationships continue to deteriorate... or why savings rates are increasing. Markets will continue to deteriorate until honest, integrity-filled leadership takes control of the USA.
 
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