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Morgan Stanley Just Walks Away From Five San Fran Office Towers
Cold Cost/Benefit analysis is the ethic we have chosen.
Steve Waldman at Interfluidity has a post on this issue:
"Businesses walk away from contracts all the time, whenever the benefits of doing so exceed the costs under the terms by which they are bound."
"Individuals must operate in a competitive economic environment dominated by entities constitutionally incapable of overriding self-interest to “do the right thing”. Virtuous individuals can expect no reciprocity from the firms with which they contract. They have two choices: live nobly and get screwed, or adopt the amoral norms of their counterparties. It has taken some time, but we are all coming around to the only supportable view. “It’s just business,” we shrug, even if we never wanted to be businessmen."
David Pylyp; If I buy a home / house /condo and realise some years down the road that I am underwater (over financed) on my Investment or purchase I can merely [GIVE BACK] that asset and walk away from any other financial consequences and personal obligation in Canada.
UMMM... No [They] liquidate all the assets of the borrower to repay all the debts starting with local and municipal taxes, condo management maintenance fees then interest arrears and they will chase you for the balance.
The US markets just paid a horrific price for bailouts and other "LEADER" is continuing in exactly the same vein. Did we miss a lesson?
This sets an incredible example for our children and future generations in that; at any point in time if they do not like the result of their choices, yes choices! they can walk away with impunity. Life without consequences. Is anyone responsible for anything?
What do yo think?
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