英文阅读：Main Street vs. Wall Street
Reader question:Main Street, Wall Street, what's the difference?
My comments:
Currently in the news, there's a general sense of doom and gloom over the
global financial market due to problems from Wall Street, a real street in New
York City where major banks are located. Wall Street is the financial center of
America as well as the global capital market in general.
Spearheaded by failings first detected in mortgage firms whose managers
promised home buyers too good a deal to sustain, other investment banks are soon
found to have long been digging holes for themselves also. The upshot is, many –
perhaps most because they all operate on more or less the same fundamental
risk-reward principles – major banks are either insolvent or on the brink.
Hence the Bush Administration's highly necessary but unpopular bailout plan
that effectively asks tax payers to fork out a gargantuan US$700 billion to get
the banks back on their feet. That will help make sure banks are willing to lend
money to each other and to manufacturers again. That is the plan. It may work.
It will work to some extent because after all, money makes the world go round.
Anyways, if it works, the global financial system can function as normal
again.
And that, among other things, will probably start another vicious cycle,
leading to something like the present debacle once again some time in future.
That is, according to the innermost fears of the free-market advocate. Banks,
you see, will have the money to hedge and gamble again, enriching corporate
executives while perhaps accumulating more bad debts, till one day, the whole
thing collapses again like a paper house. And the tax payer represented by the
government has to step in do it again (so that banks can again have a clean
sheet to start the roulette running one more time).
That's just capitalism at work, or some say, at its worst.
Hence and therefore the unpopular Bush plan. Common folks rightfully ask
why they the people should pay for the failures of the fat cats. The fat cats
(bank managers) will have sold their stocks before the markets crash or had long
before resigned, or been fired, and landed safely with a golden parachute (we'll
talk about the parachute another day). In other words, there is no punishment
for corporate executives who run their banks to the ground.
This leads us to the chagrin on Main Street. Main Street is the generic
term for cities' busiest shopping centers. It's similar to High Street in
Britain. In contrast to Wall Street, where big money changes hands, the Main
Street is where common folks eke out a trade.
The financial crisis in America has united the two streets in that they are
often seen in the same sentence, such as for example: Dump Wall Street's Trash
on Main Street.
Not that the two streets will ever unite in the proper sense, but Main
Street does share some of the blame for Wall Street's woes in that every time
Wall Street executives come up with something rewarding (to Wall Street) but
risky (to Main Street), Main Street folks lap it up. Main Street, you see, takes
the bait and that is the problem. For example, if the American public doesn't
live on borrowed money (credit cards, etc.) so much, they'll probably not have
to pay so handsomely for the current credit crunch. Wall Street, of course, will
not have merited such a sweeping cleanup. Not so soon, at any rate.
Anyways, that's a light-hearted street talk on the serious business of
money matters on Wall Street. Please go check the news and correct me if you
can.
Here are a few headlines:
1. Main Street turns against Wall Street (Money.cnn.com, September 28,
2008).
2. Wall Street's troubles disable credit on Main Street (International
Herald Tribune, September 19, 2008).
3. Wall Street and Main Street: What Contributes to the Rise in the Highest
Incomes? (NBER.org, July, 2008).
4. From Wall Street to Main Street: Lessons from the Great Depression
(Voxeu.org, September 28, 2008).
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