Democrats say the darndest things!

Submitted by Timmy the Wonder Dog on Thu, 10/02/2008 - 4:46pm. Tags:

Frank being Frank

The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see.

Harry being Harry

"We don't have a lot of leeway on time," Reid told reporters in the Capitol. "One of the individuals in the caucus today talked about a major insurance company -- a major insurance company -- one with a name that everyone knows that's on the verge of going bankrupt. That's what this is all about."

Harry, actually a Harry surogate, taking a "MacGregor"

"Senator Reid is not personally aware of any particular company being on the verge of bankruptcy," Manley wrote in an e-mail to ABCNews.com. "Rather, his comments were meant to refer to the conditions in the financial sector generally. He regrets any confusion his comments may have caused."

More from Frank

Rep. Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .

Maxine dazzles us with her wisdon.

Secretary Martinez, if it ain't broke, why do you want to fix it? Have the GSEs [government-sponsored enterprises] ever missed their housing goals?

Frank has a conversation with an "expert"

Let me ask [George] Gould and [Franklin] Raines on behalf of Freddie Mac and Fannie Mae, do you feel that over the past years you have been substantially under-regulated?

Mr. Raines?

Mr. Raines: No, sir.

Mr. Frank: Mr. Gould?

Mr. Gould: No, sir. . . .

Mr. Frank: OK. Then I am not entirely sure why we are here. . . .

Rep. Frank: I believe there has been more alarm raised about potential unsafety and unsoundness than, in fact, exists.

Same "expert" only this time he speaking to Chucky Schumer

And my worry is that we're using the recent safety and soundness concerns, particularly with Freddie, and with a poor regulator, as a straw man to curtail Fannie and Freddie's mission. And I don't think there is any doubt that there are some in the administration who don't believe in Fannie and Freddie altogether, say let the private sector do it. That would be sort of an ideological position.

Mr. Raines: But more importantly, banks are in a far more risky business than we are.

I'll round out the diary with a Republican.

Hagel (R., Neb.): Mr. Chairman, what we're dealing with is an astounding failure of management and board responsibility, driven clearly by self interest and greed. And when we reference this issue in the context of -- the best we can say is, "It's no Enron." Now, that's a hell of a high standard.

The "self interest" and "greed" would be referring to D.C. not Wall St. There is no need for me to fillin the balance.

The link

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"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

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Thomas Frank puts this one to bed (#126186)
by Spartacvs on Thu, 10/02/2008 - 5:28pm

Also in the WSJWSJ.

The GOP Blames the Victim

Capitalism sure is fragile if subprime borrowers can ruin it.

When some free-market scheme blows up, one needs only find an institution of government in close proximity to the wreckage and commence accusing. Thus we hear from some on the right that the disaster on Wall Street was the handiwork not of those with unbridled pecuniary motives but of Fannie Mae and Freddie Mac, which were government-sponsored enterprises and therefore partially exempt from market discipline and of theoretical necessity the sole culprits.

Ah, but truth is no ally to a conservative with his back to the wall. So much more helpful are the trusty narratives on which the movement was built. So when we have dispatched this first canard, we learn from other conservatives that it is the sub-prime people who are to blame; that by taking out loans they couldn't possibly pay off, these undesirable borrowers have ruined us all.

There is no way to measure the number of people who took out mortgages they knew they couldn't afford, of course, but for what it's worth, a 2007 report by the Mortgage Bankers Association reports that the FBI estimates "80 percent of all reported fraud losses arise from fraud for profit schemes that involve industry insiders." That means the lenders, not the borrowers.

Just imagine the flights of fancy that the theory of borrower malevolence and Wall Street victimization requires conservatives to take: All these no-account folks, you see, got together and forced investment banks to engineer subprime mortgages into highly leveraged securities. Then they tricked all manner of hedge funds and pension funds and financial institutions into buying these lousy products. Just for good measure, these struggling homeowners then persuaded bond-rating agencies to misrepresent the risk associated with these securities.

Now imagine what such a fantastic scheme, if true, would mean for capitalism itself. This economic system, glorified by all, dominates the globe today, bidding prices up and down, forcing entire nations to change their ways to better suit its needs, and yet it is so fragile that when challenged by the weakest members of society and a handful of community organizers it simply crumbles. Thank goodness the Soviets never figured this out.

Exactly.

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GW Bush, leading contender for worst President ever.

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just imagine, if Freddie or Fannie (#126228)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 6:59pm

hadn't wrapped a guarantee around that trash, which was the point of the regulation.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Are you saying (#126245)
by Spartacvs on Thu, 10/02/2008 - 7:11pm

the wizards on Wall St. knew they were over leveraging guaranteed trash, with no thought for the consequences of a housing bubble that could burst?

--

GW Bush, leading contender for worst President ever.

( | parent )
you keep on using the term "over leveraging" (#126281)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 8:13pm

and i'm not sure what you mean by that.

but the failure not to look through a transaction(s) because of the guarantees wrapped around it isn't an unusual situation (when you are buying and structuring assets, buying and selling bonds) in fact when entering into a derivative transaction counterparty risk is the key driver.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Over-leveraging? How about 100:1 on securities (#126417)
by Jordan on Fri, 10/03/2008 - 7:07am

that never get, and generally can't be, "marked-to-market"?

--

Before you criticize someone, you should walk a mile in their shoes. That way when you criticize them, you're a mile away and you have their shoes. -JH

( | parent )
you keep on saying that (#126666)
by Timmy the Wonder Dog on Fri, 10/03/2008 - 4:31pm

and I keep on asking how did they over-leverage.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Can there be such a thing (#126676)
by Spartacvs on Fri, 10/03/2008 - 4:38pm

is that what you're asking? You're the expert, supposedly. Define the threshold for us.

--

GW Bush, leading contender for worst President ever.

( | parent )
I had the naive thought that the threshold was passed (#126686)
by tomsyl on Fri, 10/03/2008 - 5:01pm

the moment the margin trader exceeded his ability to cover any margin call on the spot. That's certainly the case for you, me, or any other individual investor daring/foolish enough to buy on margin; why not the pros who made millions a year doing the same thing?

--

Even a dead midget is far from light. - Confucius

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The rules are different (#126707)
by Spartacvs on Fri, 10/03/2008 - 5:41pm

apparently, when you are just making a lowly commission on investing other peoples money and not your own. But the numbers are much, much larger, as I suspect are the 'lowly' commissions.

--

GW Bush, leading contender for worst President ever.

( | parent )
So the mantle of victimhood now descends on people (#126210)
by tomsyl on Thu, 10/02/2008 - 6:36pm

who bought houses they couldn't afford and now can't make the payments? Can I buy a badly needed BMW M-6 that way?

--

Even a dead midget is far from light. - Confucius

( | parent )
As a taxpayer (#126230)
by Spartacvs on Thu, 10/02/2008 - 7:01pm

I would instruct my Congressperson to tell those people to take a hike, unless they can be put into re-configured loans that would allow them to make payments and keep their homes. But only in respect to primary residencies, not second homes, non-resident condos or investment property. The middleman who enabled their every flight of fancy with every bogus boutique mortgage product under the sun, of which few made any effort to determine the ability to make payments beyond the date of the commission check? They should probably do time, if we can catch them and document their fraud. The shy stirrers on Wall St. who took that money and leveraged it up the ying yang while thinking only of the upside and who are primarily responsible for producing the current crisis? They should be gibbeted, their worldly possessions seized and distributed to the poor. But they won't be. Because unfortunately it seems we need them or at least most of them, in order to avoid economic Armageddon and restore 'confidence' in the markets, after we give them a new stake to play with of course.

--

GW Bush, leading contender for worst President ever.

( | parent )
thank you (#126283)
by heet on Thu, 10/02/2008 - 8:25pm

for making me google gibbet

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Over here on E Street, we're proud to support Obama for President. - Bruce Springsteen

( | parent )
My pleasure (#126495)
by Spartacvs on Fri, 10/03/2008 - 12:10pm

Sometimes, being told "I will make them famous, and you will know their names" just isn't enough.

--

GW Bush, leading contender for worst President ever.

( | parent )
You can bronze this reply, Sparti: (#126249)
by tomsyl on Thu, 10/02/2008 - 7:18pm

I agree point-for-point with that comment.

--

Even a dead midget is far from light. - Confucius

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I don't think we were ever really that far apart (#126500)
by Spartacvs on Fri, 10/03/2008 - 12:17pm

at least not on this issue.

But I'm not ready to share a cabin just yet, so please don't make a scene.

--

GW Bush, leading contender for worst President ever.

( | parent )
And here I thought we'd be picking out china patterns together (#126717)
by tomsyl on Fri, 10/03/2008 - 5:50pm

over the weekend. Dang.

--

Even a dead midget is far from light. - Confucius

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No, they were stupid (#126215)
by HankP on Thu, 10/02/2008 - 6:45pm

but they weren't leveraging up 70-1 either, and they have the excuse of not having MBAs and finance degrees.

--

I blame it all on the Internet

( | parent )
I'm even less in favor of bailing out Wall Street than you seem (#126224)
by tomsyl on Thu, 10/02/2008 - 6:53pm

to be, but that really has nothing to do with calling mortgage defaulters "victims", does it? Meaning yours is a clever but off-point comment which doesn't rehabilitate Frank's piece in the slightest.

--

Even a dead midget is far from light. - Confucius

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Some of them were victims (#126234)
by HankP on Thu, 10/02/2008 - 7:04pm

I know when I refinanced my house I had mortgage brokers tell me things that I knew were untrue. I'm fairly well educated and you're a lawyer, what about people who were neither?

I'm sure there were some sharp buyers who got away with fraud, but for problems on the level we're seeing it's a bit surreal to blame the least educated and knowledgeable people in the whole chain of transactions.

--

I blame it all on the Internet

( | parent )
The important point is that many went to subprime lenders (#126252)
by tomsyl on Thu, 10/02/2008 - 7:23pm

after being turned down by mainstream banks because they didn't have enough monthly income, has a work history that was too brief or erratic, couldn't make the down payment, were trying to borrow more than the appraisal merited on a L/V basis, or some combination of the above. Then they tired again through a mortgage broker and magically got the loan on worse terms. No rocket science needed.

Based on experience involving them, I assume mortgage "brokers" (many doing the work don't even have that rudimentary license) are criminals until proven otherwise, at least in this real property-happy jurisdiction. By try catching them and getting money out of them.

--

Even a dead midget is far from light. - Confucius

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I think you're making my point (#126256)
by HankP on Thu, 10/02/2008 - 7:27pm

if you go to a "mortgage professional" (yes, that's what some of them call themselves) and they tell you it's no problem, how many people are going to do a thorough check of other lenders and their standards? Heck, even I didn't do that, I just carefully read the proposals I got and picked the one that was best for me.

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I blame it all on the Internet

( | parent )
blame the least educated and knowledgeable (#126240)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 7:07pm

but that was Freddie and Fannie target mkt; the mkt necessary to manage the Dems in Congress.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

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Mortgage brokers lied both ways (#126244)
by HankP on Thu, 10/02/2008 - 7:10pm

down to the buyers and up to the originators and packagers.

Besides, my other post pretty much destroys the "Fannie/Freddie were the cause of all this" idea.

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I blame it all on the Internet

( | parent )
my other post pretty much destroys (#126669)
by Timmy the Wonder Dog on Fri, 10/03/2008 - 4:33pm

but then again it doesn't. that is, if Freddie and Fannie hadn't wrapped their guarantees and made a secondary mkt, we wouldn't be having this problem.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
What a ridiculous tool that man is. (#126195)
by vinteuil on Thu, 10/02/2008 - 5:55pm

And what a hard time he seems to have noticing (let alone quoting) the actual arguments offered by those who disagree with him.

One might almost take him for a forvm commenter!

--

God help the while, a bad world I say.

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Got it (#126203)
by Spartacvs on Thu, 10/02/2008 - 6:32pm

Don't forget to turn off your TV tonight, from 9:00 to 10:30pm.

--

GW Bush, leading contender for worst President ever.

( | parent )
And this has what to do with the current crisis? (#126185)
by HankP on Thu, 10/02/2008 - 5:28pm

Nothing, that's what. I found a great summary of why CRA and Fannie and Freddie have little to nothing to do with the current problems:


Let's clarify the causes of current circumstances. Ask yourself the following questions about the impact of the Community Reinvestment Act and/or the role of Fannie & Freddie:

• Did the 1977 legislation, or any other legislation since, require banks to not verify income or payment history of mortgage applicants?

• 50% of subprime loans were made by mortgage service companies not subject comprehensive federal supervision; another 30% were made by banks or thrifts which are not subject to routine supervision or examinations. How was this caused by either CRA or GSEs ?

• What about "No Money Down" Mortgages (0% down payments) ? Were they required by the CRA? Fannie? Freddie?

• Explain the shift in Loan to value from 80% to 120%: What was it in the Act that changed this traditional lending requirement?

• Did any Federal legislation require real estate agents and mortgage writers to use the same corrupt appraisers again and again? How did they manage to always come in at exactly the purchase price, no matter what?

• Did the CRA require banks to develop automated underwriting (AU) systems that emphasized speed rather than accuracy in order to process the greatest number of mortgage apps as quickly as possible?

• How exactly did legislation force Moody's, S&Ps and Fitch to rate junk paper as Triple AAA?

• What about piggy back loans? Were banks required by Congress to lend the first mortgage and do a HELOC for the down payment -- at the same time?

• Internal bank memos showed employees how to cheat the system to get poor mortgages prospects approved that shouldn't have been: Titled How to Get an "Iffy" loan approved at JPM Chase. (Was circulating that memo also a FNM/FRE/CRA requirement?)

• The four biggest problem areas for housing (by price decreases) are: Phoenix, Arizona; Las Vegas, Nevada; Miami, Florida, and San Diego, California. Explain exactly how these affluent, non-minority regions were impacted by the Community Reinvesment Act ?

• Did the GSEs require banks to not check credit scores? Assets? Income?

• What was it about the CRA or GSEs that mandated fund managers load up on an investment product that was hard to value, thinly traded, and poorly understood

• What was it in the Act that forced banks to make "interest only" loans? Were "Neg Am loans" also part of the legislative requirements also?

• Consider this February 2003 speech by Countrywide CEO Angelo Mozlilo at the American Bankers National Real Estate Conference. He advocated zero down payment mortgages -- was that a CRA requirement too, or just a grab for more market share, and bad banking?

The answer to all of the above questions is no, none, and nothing at all.

So please stop this transparent propaganda attack. You're only trying to fool the rubes, even someone like me who's only educated myself on the issue by reading what I can on the internet can see right though it.

(The excerpt is from The Big Picture, which is highly recommended for people who want facts rather than bovine byproduct in their reading and analysis.)

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I blame it all on the Internet

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you missed the the 92 amendment (#126229)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 7:01pm

and the subsequent actions by the DoJ.

but more importantly, there is absolutely no mention of the CRA in the diary.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Two birds with one stone (#126241)
by HankP on Thu, 10/02/2008 - 7:08pm

since you've been mentioning the CRA repeatedly. If you're given up on that line, good for you.

I'd like to hear how the 92 revisions caused a problem that didn't really get going until 10 years later. Remember that the vast majority of the mortgage mess was during 2002-2007.

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I blame it all on the Internet

( | parent )
the 92 revisions changed the parameters (#126673)
by Timmy the Wonder Dog on Fri, 10/03/2008 - 4:35pm

open the opportunties and Congress kept pushing for higher targets.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Republicans say the darndest things too! (#126184)
by Spin Doctor on Thu, 10/02/2008 - 5:28pm

Just a few hours ago, a McCain campaign spokesman confirmed that McCain is pulling out of Michigan. According to the campaign, they are going to focus their efforts on, among other places, Wisconsin! So notwithstanding the fact that they have the favorite son of the former Michigan Governor pimping for John McCain in Michigan, they are going to focus on Wisconsin which, according to Nate Silver, is more of a lock for Obama than Michigan.

Change you can believe in!

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Patriotism is supporting your country all the time, and your government when it deserves it. -Mark Twain

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Thanks, Timmy (#126168)
by Harley on Thu, 10/02/2008 - 4:59pm

I'm glad there's a place to see what Democrats not named Barak Obama said about Freddie and Fannie five years ago. Great stuff. Except I think you already posted the videos in another diary. About the same hearings.

Hey. Maybe next time you can come to each of our houses and interpret these same hearings in modern dance.

--

To think is not enough; you must think of something -- Jules Renard

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Shorter Harley: (#126180)
by vinteuil on Thu, 10/02/2008 - 5:11pm

Facts don't matter. We want power now. And we want it so badly, and we're typing so fast, that we can't even be bothered to spell our own candidate's name right.

O-BA-MA!

O-BA-MA!

O-BA-MA!

--

God help the while, a bad world I say.

( | parent )
Once again (#126217)
by HankP on Thu, 10/02/2008 - 6:46pm

any facts in any of these rants?

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I blame it all on the Internet

( | parent )
The Only Value In This Limp Comment (#126200)
by Harley on Thu, 10/02/2008 - 6:18pm

Is if it catches the eye of a feisty mod.

--

To think is not enough; you must think of something -- Jules Renard

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On the plus side... (#126204)
by vinteuil on Thu, 10/02/2008 - 6:33pm

...you didn't add "wristed" to "Limp."

You so subtle.

But, on the minus side, a mod sufficiently feisty to call me out for the above comment might as well just shut down all worthwhile discussion, here.

Oh...wait...

--

God help the while, a bad world I say.

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Biskit. (#126239)
by tomsyl on Thu, 10/02/2008 - 7:06pm

There, I said it.

--

Even a dead midget is far from light. - Confucius

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Heaven Forbid (#126212)
by Harley on Thu, 10/02/2008 - 6:40pm

I always figured you for a bear.

--

To think is not enough; you must think of something -- Jules Renard

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Jeez, Harley... (#126262)
by vinteuil on Thu, 10/02/2008 - 7:34pm

...don't you know *anything?*

Bears, invariably, have the limpest wrists of all.

That's why they try to compensate with lots of body hair, multiple piercings, and all the rest of it.

Poor dears.

--

God help the while, a bad world I say.

( | parent )
Fannie and Freddie (#126192)
by Gabriel on Thu, 10/02/2008 - 5:43pm

have little to nothing to do with the present crisis.

Of course if they were mismanaged by all means let's find out why. But the current crisis is not related to them or to the CRA.

Or to the abolition of Glass Steagall, as many at DKos seem to think.

--

This place is my vacation.

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the current crisis is directly related to both (#126235)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 7:04pm

as well the Dems stopping the necessary regulation of Freddie and Fannie, given your leverage meme.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Show me the numbers (#126265)
by Gabriel on Thu, 10/02/2008 - 7:40pm

And I will change my mind.

Fannie and Freddie were simply not players in the subprime market. That's what a subprime mortgage is, one that can't be sold to them (leave aside jumbos). They bought some stuff in the secondary market but that was way after the problems developed and way too little to make a difference.

--

This place is my vacation.

( | parent )
And I will change my mind. (#126674)
by Timmy the Wonder Dog on Fri, 10/03/2008 - 4:37pm

Freddie and Fannie packaged about 40% of the subprime mkt. No Fannie and Freddie the subprime is just a footnote.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Subprime is irrelevant. (#126767)
by Punditus Maximus on Fri, 10/03/2008 - 10:14pm

Bubbles are bubbles are bubbles.

--

It's impossible to debate if people simply hold beliefs that have no grounding in reality.

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I disagree about glass steagal (#126214)
by HankP on Thu, 10/02/2008 - 6:43pm

I think the combination of allowing FDIC banks into investment along with blocking all regulation of derivatives helped move the investment banks, broker dealers and insurance companies into the more highly leveraged types of investments. FDIC insured assets are a much higher quality asset and acts as an effective government subsidy of regulated bank assets, which the other financial companies didn't have access to.

I don't think that's the whole reason, but I don't think it helped either.

--

I blame it all on the Internet

( | parent )
Lack of regulation of derivatives (#126218)
by Gabriel on Thu, 10/02/2008 - 6:48pm

Yes, that may be an issue.

But that's not the repeal of Glass Steagall. If anything the repeal has helped since we see the healthier commercial banks buying the investment banks.

We should have had regulation of hedge funds and investment banks after the LTCM collapse and maybe we'll get it now.

--

This place is my vacation.

( | parent )
LTCM collapse (#126232)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 7:02pm

has very little to with either.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Directly related (#126268)
by Gabriel on Thu, 10/02/2008 - 7:42pm

Once the Fed showed it would bail out highly leveraged institutions whose collapse could impact the markets, regulation became mandatory.

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This place is my vacation.

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But the Fed didn't bail it out (#126677)
by Timmy the Wonder Dog on Fri, 10/03/2008 - 4:39pm

although it tried. LTCM was an excellent source of liquidity but it had problems with bank lines.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
I know they're not the same thing (#126227)
by HankP on Thu, 10/02/2008 - 6:59pm

but in combination I think they helped create the current problem.

I don't think the repeal has helped, we're now getting consolidation so that every bank is too big to fail. It's a temporary fix but setting up up for even more problems in the future. I think we should be putting a limit on how big these financial combines can get for that reason alone.

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I blame it all on the Internet

( | parent )
Yes (#126269)
by Gabriel on Thu, 10/02/2008 - 7:43pm

I can agree with that. But I guess right now we need to put out the fire.

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This place is my vacation.

( | parent )
Yup (#126270)
by HankP on Thu, 10/02/2008 - 7:46pm

which is why I reluctantly agree with the current bailout plan, as complicated and pork laden as it's become. This is turning into a global crisis, I don't think people realize how bad it could get.

--

I blame it all on the Internet

( | parent )
I know you know, and I'm not suggesting subprime defaults (#126236)
by tomsyl on Thu, 10/02/2008 - 7:05pm

caused the problems we're dealing with now. I just disagree strongly with Frank's meme that defaulters are victims, even though about half of Congress is muttering the same thing.

I'm not any happier than you are about marginalists getting bailed out by the taxpayers,either, not a bit.

--

Even a dead midget is far from light. - Confucius

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tomsyl, there are reasons we punish drug sellers (#126421)
by Bill White on Fri, 10/03/2008 - 8:46am

more harshly than drug users.

Yes, some homeowners were greedy or foolish but they weren't the pushers. The pushers are the middlemen earning commissions helping borrowers qualify for loans the brokers KNEW wouldn't be repaid and those brokers sell that same junk paper to others.

Bad loans have also arisen from loan brokers altering the paperwork AFTER the customer submitted it and loan brokers conspiring with real estate agents to fluff up false front buyers either for modest compensation or via simple identity theft.

--

Fence post turtles -- They don't get up there by themselves, some moron had to put 'em there.

( | parent )
Like I said (#126250)
by HankP on Thu, 10/02/2008 - 7:19pm

going by my experience when I refinanced about 5 years ago, there was a lot of lying going on. I tend to blame people who do mortgages for a living more than those who do it only a couple three times in their lifetime.

I also said that there was fraud by buyers. There was also a lot of stupidity (or naivete if you want a nicer sounding word). However, the lenders threw out their standards on who could get a loan, that was a much bigger factor. They're supposed to be the pros, they're the ones who are supposed to determine whether they should loan money to someone. When I heard that there was an actual loan type called a NINJA (no income, no job, no assets) I knew there were big problems ahead. The home buyers aren't the ones who set up those loan programs.

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I blame it all on the Internet

( | parent )
bta, you probably should (#126243)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 7:08pm

and yes subprimes are one of the key drivers to this situation.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
Key drivers...at about 1:70 of all cases. -nt- (#126418)
by Jordan on Fri, 10/03/2008 - 7:11am

.

--

Before you criticize someone, you should walk a mile in their shoes. That way when you criticize them, you're a mile away and you have their shoes. -JH

( | parent )
So Gabriel (#126206)
by catchy on Thu, 10/02/2008 - 6:35pm

in your view has deregulation played any role?

Does the gov. bear any responsibility for this?

( | parent )
Yes (#126223)
by Gabriel on Thu, 10/02/2008 - 6:50pm

In that since the govt showed in the LTCM bailout in 98 that even unregulated hedge funds would have to be bailed out in a crisis they should have begun to regulate them at the time, imposing limits on leverage.

--

This place is my vacation.

( | parent )
Live by the sig. (#126189)
by Spartacvs on Thu, 10/02/2008 - 5:36pm

n/t

--

GW Bush, leading contender for worst President ever.

( | parent )
Present (#126171)
by Timmy the Wonder Dog on Thu, 10/02/2008 - 5:04pm

and thank you for the very large donations.

--

"Making sure your tires are properly inflated, simple thing, but we could save all the oil that they're talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much." Ob

( | parent )
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