The evening news stares at failed homes as it reports on increased rates of legal and illegal foreclosures. The financial industry, standing flat in front of the same house, demands that the object behave like money again. As long as it behaves like money, everything is fine. Now banks are forced to send, as a courtesy, friendly reminders to the house that it is a monetized object and that its very existence owes everything to that fact. Frustrated with the absolutely flagrant refusal of the house to conform to requests, banks must understandably withdraw their helpful demeanor and offload the chore of identity correction to collectors who are in a position to be more dispassionate.
Mold grows in the pool. The inhabitants, who, needless to say, should have recognized that the house was money, are long gone. Their offers to live in the house for less money were obviously both emotional and irrational. The only way to rationally recoup losses in this whole misunderstanding is for the bank to sell the house for less money—to return trust to a free market that at least offers a rational basis for negotiation, a level playing field and some shared sensitivity to the bank’s problem. This is economic science.