Our financial crisis is not an obscure, unpredictable event that overwhelmed good practices. Housing policy, government control, and unconstrained lending to buy votes was obviously dangerous. It required active disregard for the rules, in the House Financial Services Committee under Congressman Barney Frank (D-MA), among others. The government put up a sign “We buy bad loans made to poor people”, and banks and financial institutions supplied those loans as requested.
When you drive 120 mph, have an accident, and kill someone, is it really an accident?
Diagnosis is everything. Don’t just blame ACORN, the lawyers, or the bankers. The government has a big sign up “Favors for sale. Votes bought here”. They are doing this with your money, your opportunities, your future, and the future of your children.
Don’t just think “It happened under the Democrats or Republicans”. That makes as much sense as being blamed for what your co-worker did. Investigate the facts. Start here:
The government’s ability to issue guarantees is an unlimited, off-budget, extremely dangerous power. Government granted guarantees to Fannie Mae and Freddie Mac, among other institutions, under the table. They used them to borrow and lend massive capital resources, to build houses that could not be paid for. This has caused our financial crisis.
Government borrowing and guarantees have got to stop. Either we will stop voluntarily, or financial collapse will stop us anyway.
The present housing bubble is just a replay of the S&L scandal on a greater scale. Both were a matter of privatizing the gains and socializing the losses, whether it was the taxpayers on the hook for the folly and greed of the S&L executives or the folly and greed of the Fannie Mae and Freddy Mac executives. Crony capitalism works fine, if you’re one of the cronies. Just ask Barney Frank and Senator Dodd.
I watched more than my share of hearings on C-Span about the financial meltdown. Lending to poor folks was a problem. To lenders, the risk was small because one could always foreclose on the property. But the value of the property was set in part by a market of poor folks who could get financing. Once there was a minor break in house values due to overbuilding, the poor-folks market vaporized and housing prices dropped even more. Poor lending standards were wrong by themselves, but our foolishness would not explain the chaos in England.
The effect of refinancing probably was a greater factor for the meltdown in that lots of people got income for no effort. That is OK for some risk takers, but can’t hold for almost everybody. the mortgage interest deduction has this fault too. When everybody is advantaged, nobody is advantaged.
The main problem for the financial mess of 2008, in my opinion, was the demographic structure in the world where people wanted to save for retirement because of not having large families to depend upon. Our Social Security benefits can not be pre-funded as in a private pension plan because the reserves would exceed the total value of everything in America. There isn’t enough ways for the world to allow all to save for retirement.
Republicans say we should not tax the job providers. But there is a trillion and a half dollars of cash just sitting on the books of job providers, which funds are doing nothing. Those funds should be taxed to reduce our deficit. We now have the ridiculous policy of low taxes on rich folks so they can purchase the bonds that finance their tax breaks.
Great comment, Jack Olson. Wait? Olson? The liberal brother that has been hidden in the closet? How did you finally escape? We sent a team out for you once. They got lost.
A good book written by an economist is Thomas Sowell’s The Housing Boom and Bust. It’s great to have an easy to find bad guy, but there are a lot of layers where each contributed.
And I’ll take capitalist greed over anything the fascists, communists, or any government planned economy have in mind.
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Our financial crisis is not an obscure, unpredictable event that overwhelmed good practices. Housing policy, government control, and unconstrained lending to buy votes was obviously dangerous. It required active disregard for the rules, in the House Financial Services Committee under Congressman Barney Frank (D-MA), among others. The government put up a sign “We buy bad loans made to poor people”, and banks and financial institutions supplied those loans as requested.
When you drive 120 mph, have an accident, and kill someone, is it really an accident?
Diagnosis is everything. Don’t just blame ACORN, the lawyers, or the bankers. The government has a big sign up “Favors for sale. Votes bought here”. They are doing this with your money, your opportunities, your future, and the future of your children.
Don’t just think “It happened under the Democrats or Republicans”. That makes as much sense as being blamed for what your co-worker did. Investigate the facts. Start here:
We Guarantee It – The Government Caused the Economic Crisis
The government’s ability to issue guarantees is an unlimited, off-budget, extremely dangerous power. Government granted guarantees to Fannie Mae and Freddie Mac, among other institutions, under the table. They used them to borrow and lend massive capital resources, to build houses that could not be paid for. This has caused our financial crisis.
Government borrowing and guarantees have got to stop. Either we will stop voluntarily, or financial collapse will stop us anyway.
The present housing bubble is just a replay of the S&L scandal on a greater scale. Both were a matter of privatizing the gains and socializing the losses, whether it was the taxpayers on the hook for the folly and greed of the S&L executives or the folly and greed of the Fannie Mae and Freddy Mac executives. Crony capitalism works fine, if you’re one of the cronies. Just ask Barney Frank and Senator Dodd.
I watched more than my share of hearings on C-Span about the financial meltdown. Lending to poor folks was a problem. To lenders, the risk was small because one could always foreclose on the property. But the value of the property was set in part by a market of poor folks who could get financing. Once there was a minor break in house values due to overbuilding, the poor-folks market vaporized and housing prices dropped even more. Poor lending standards were wrong by themselves, but our foolishness would not explain the chaos in England.
The effect of refinancing probably was a greater factor for the meltdown in that lots of people got income for no effort. That is OK for some risk takers, but can’t hold for almost everybody. the mortgage interest deduction has this fault too. When everybody is advantaged, nobody is advantaged.
The main problem for the financial mess of 2008, in my opinion, was the demographic structure in the world where people wanted to save for retirement because of not having large families to depend upon. Our Social Security benefits can not be pre-funded as in a private pension plan because the reserves would exceed the total value of everything in America. There isn’t enough ways for the world to allow all to save for retirement.
Republicans say we should not tax the job providers. But there is a trillion and a half dollars of cash just sitting on the books of job providers, which funds are doing nothing. Those funds should be taxed to reduce our deficit. We now have the ridiculous policy of low taxes on rich folks so they can purchase the bonds that finance their tax breaks.
Great comment, Jack Olson. Wait? Olson? The liberal brother that has been hidden in the closet? How did you finally escape? We sent a team out for you once. They got lost.
A good book written by an economist is Thomas Sowell’s The Housing Boom and Bust. It’s great to have an easy to find bad guy, but there are a lot of layers where each contributed.
And I’ll take capitalist greed over anything the fascists, communists, or any government planned economy have in mind.