Originally posted by ProfEmeritus
reply to post by dalan.
The Fed aided and abetted, but again, the ultimate cause was allowing people who COULD NOT AFFORD to pay back the loans, to receive them. Standards
that HAD been in place to prevent such loans, were FORCED by the people I mentioned to be loosened or IGNORED, with severe penalties to any lender
that FAILED to APPROVE SUCH LOANS.
The Fed SHOULD be eliminated. I agree;however the ultimate cause of our present world-wide financial crisis was the Housing crisis, and that was
caused by the steps I mentioned above. This is not a partisan issue. These are the facts, and any honest economist will tell you that. There is plenty
of blame to go around- the government, ACORN, the lenders, AND the buyers, who should have READ the mortgage contracts that they signed. You
shouldn't make the purchase of your life without investigating the consequences, and the costs. Unfortunately, those 95% of us that did nothing
wrong, and were responsible, are now stuck picking up the bill for the 5% that were responsible, and the crooked lenders and government officials walk
away scott free. America, what a country!
umm...let me see if I can get this into perspective here....
they have thrown enough money at this problem that it would cover half of the mortgages in our country.....
and, it hasn't even touched the problem....
it seems to me, that half of the mortgages in this country aren't that dangerously in trouble anyways. and well, to put it more bluntly, if half of
these mortgages are considered to be sub-prime, well, we have bigger problems than some bad mortgages...
now, they are saying that alot of the commercial real estate will be going down also....
there is no way that it all adds up in a way that you can blame a group of subprime borrowers for the problem, or a few laws that were passed a decade
or so ago.....if that was the problem, wouldn't we be seeing the problems pop up earlier in the bush administration?
bush and company removed alot of the gov't regulations within the economy, gave the business community free reign and they grabbed it and ran. not
only did the fed government refuse to regulate these lenders, but they prevented states that had enough foresight to see the train wreck ahead to
regulate them! he wanted the illlusion that all was fine and dandy in the economy so his two wars and massive tax cuts to the richest amoung us could
be more easily justified to the masses. the last four or five years have been a grand illusion of a decent economy.....but an illusion that was based
on us all going deep into debt. and the ptb clung to that illusion to the bitter end, thus, one week bush is saying how great our economy is, then
the next, well....we need to swipe $700 billion from ya all or we will be facing a depression....
they screwed up when they made our debt a commodity that can be exchanged in the markets for a profit....
Companies have survived plenty of downturns, but economists see this one playing out like never before. In the past, when businesses hit rough
patches, owners negotiated with banks or refinanced their loans.
But many banks no longer hold the loans they made. Over the past decade, banks have increasingly bundled mortgages and sold them to investors. Pension
funds, insurance companies, and hedge funds bought the seemingly safe securities and are now bracing for losses that could ripple through the
"It's a toxic drug and nobody knows how bad it's going to be," said Paul Miller, an analyst with Friedman, Billings, Ramsey, who was among the
first to sound alarm bells in the residential market.
the loans are spread out all over the place, no one knows who owns what, they can't be refinanced, they can be renegotiated....
heck, in some of these foreclosures, the business trying to foreclose can't even come up with the paperwork to prove they have any rights to the
property. it was a free for all and it's crashing and burning!
the little subprimer with his little modest home isn't the problem, I've been window shopping at one of the auctions that is handling some of these
for some reason, this doesn't strike me as a subprime loan being bought by someone who couldn't afford to buy a home, it strikes more as someone who
wanted luxury, more home than he could afford, but well....they definately could afford to buy a home!!