This is a wonderful world that we live in! With more than one billion people living on less than one dollar per day, and problems of incredible magnitude affecting billions more all over the world, we here in America are preoccupied with whether or not OJ Simpson legally or illegally entered a hotel room in Las Vegas to get back some of his twenty year old sports memorabilia. Meanwhile, the newspapers are preoccupied with the sub-prime mortgage problems and predicting a potential US economic meltdown. What they don’t tell you is that there are approximately fifteen trillion dollars worth of mortgages outstanding in the US today. Of this amount, a maximum of one trillion can be categorized as sub-prime, or loaned to people who do not have sufficient credit to carry their increased mortgage payments. Of the one trillion dollars in sub-prime mortgage debt, perhaps 10% of that, or one hundred billion dollars is in default or at risk of going into default. But these houses do not disappear and lose 100% of their value. They are merely revalued downward by the marketplace, resold for a lesser amount than before, and reoccupied by new homeowners. Bottom line? The very best calculations suggest that there may be losses of as much as thirty-six billion dollars before the sub-prime problems are ironed out and the real estate market reestablishes itself on a straight and level keel. This is a large amount of money, but compared to the thirteen trillion dollar ($13,000,000,000,000) economy, it is an amount that primarily large banks and investors, nationally and internationally, can and will absorb. Life will go on. Don’t get excited. The situation in Iraq appears to be improving. Regardless of your opinion of the war, it must be prosecuted intelligently and brought to a proper end. The primary reasons for going into Iraq were the threats of weapons of mass destruction, to which all the major intelligence agencies in the world (US, Canada, British, German, French, Russian and Chinese) agreed existed. We are facing an enemy, “Islamo fascist extremism” that believes that all that do not bow down to Allah should be immediately murdered, including men, woman and children, even if they are Muslims but do not except a particular and extreme interpretation of the Koran. It is hard to deal diplomatically or intelligently with people, like those who flew into the twin trade towers in New York, who believe that mass murder is a legitimate way of expressing their hatred for all who disagree with their way of believing and their way of life. If we were to pull out of Iraq abruptly, the first thing that would happen would be a blood bath on a scale unimaginable since the Second World War. Hundreds of thousands of innocent people would be murdered by one faction or another, and the US would be held responsible. In addition, if the US were to pull out of Iraq precipitously, it would confirm what Osama Bin Ladin has been saying, that the US is a “paper tiger” and lacks the character or guts for a sustained fight. This would encourage and embolden Muslim extremists from all over the world to commit even more mass murder. Freedom loving peoples, who inherently dislike war of any kind, would eventually have to respond to defend themselves. The consequences of such a belated response, in the face of an enemy that wants to annihilate us, could be more severe than anyone today imagines. The most important thing is to stay calm. Read the news with an open mind. Refuse to allow the extremist fringes in American politics to sway your thinking. Above all, think long term. The true mark of intelligence is your ability to think into the future and to accurately calculate what might happen then, based on what you do today. This ability to play down the chessboard of life is the hallmark of true wisdom. I’ll talk to you again soon. Best regards,
Brian
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