After reading this article on CNN, I felt sick in my stomach about the current state of American values. As the current mortgage crisis continues to unfold, I’ve become more cynical. I had my reservations around the bail out of Bear Stearns, especially after JP Morgan quintupled it’s offer to $10. I still feel for many the Americans who are struggling in souring American Economy with mortgages they can’t afford. I have no such sympathy for the Copes whom CNN profiled.

It’s not because they worked in the heart of the subprime mortgage industry in Orange county. Employees are often as much victims of short sighted business practices as customers. Ask the numerous ex-employees of Enron.

I’ll let quotes from the article speak for themselves with some help from my own commentary :)

  • “The two didn’t say exactly how much money they made at their last jobs but Kent admitted they each had six-figure incomes.”
  • ‘”We’ve used up most of our reserves, cashed in her 401K,”‘ - Given they were making over 200k, you would think they wouldn’t have to resort to dipping into the 401k
  • “Today, they’re trying to get by on his unemployment benefits of about $450 a week, which covers only about an eighth of the basic payments they owe every month” - If basic payments are almost $10,000/month, I hate to think what their total expense are.
  • “And they’ve made cutbacks: trading in Kent’s Corvette for a Suburban and getting rid of the gardener, for example” - A Suburban is a cutback?
  • ‘”You know you could take a roller coaster ride down,” he said. “But you never envisioned it could be a free fall.”‘ - Aren’t you basically in a free fall on roller coaster on the way down

I feel bad for coming away from the article so critical of Copes. I actually don’t particularly like casting judgement, even though I do it all the time. We all have our financial shortcomings. I’ll be the first to admit that like the Copes, I eat out too much. However, having just come back from Southern California and Orange County, I readily see how things have gone wrong.

Orange county is amplification and microcosm of America. We’ve become a country too concerned with immediate gratification rather than long term satisfaction. The Copes are in their predicament not because they didn’t earn good money. They did. They are in their predicament because they had neither a contingency or sustainable plan. If you know you’re on a roller coaster, then you should know that you need to build and save energy (money) on the way up to use on the way down.