How the Democrats Created the Financial Crisis

[Scotty2Hotty]

Efficient is doing more with less. Capable is an ability to do something. Being capable doesn't mean you're efficient, but being efficient implies you are capable. I might be capable of building a bird house, but that doesn't mean I can efficiently build one. Now if I could build bird houses efficiently, that implies I'm capable.

[slow4now]

i agree with brandon, and i listened to all the way left votes that obama cast. i dont like mccain either, but i HATE the idea of a bigger government. and if you try to tell me that obama wont make it bigger, youre going to lose a lot of respect.

 

In the last 8 years REPUBLICANS have controlled EVERY BRANCH of government with the exception of the last 20 months, and NO Government in HISTORY has been bigger. So please stop perpetuating this myth that Democrats = bigger government, Republicans = smaller government.

[Science Abuse]

"Bigger gubmint vs smaller gubmit", just buzz words to tack onto a campaign slogan that ultimately have no real meaning what so ever.

 

"I'm for smaller governement"

"the fuck does that mean, John?"

"Well..umm...back in Vietnam... ehh, my record...umm...MAVERICK!"

[slow4now]

Ok. I read this article and applied some critical thinking to it since the original poster didn't seem to bother. Blame poor people, blah blah blah.

 

“But really, it isn't. Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.”

 

Nothing like factless colorful language to illustrate a point. Ugh.

 

“Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street's efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.”

 

This is simply not true on every level. 50% of subprime loans were made by mortgage service companies that are not subject to federal supervision. Another 30% were made by banks or thrifts not subject to routine supervision. Not only that but Fannie and Freddie’s biggest problem wasn’t their subprime loans, it was Alt A mortgages (rated better than subprime.) These were loans that were initially given out by other companies which did not attempt to verify income or net worth and were for principal balances significantly higher than what is typically made to low-income borrowers. See: Jose Conseco http://latimesblogs.latimes.com/laland/2008/05/celebrity-forec.html

 

 

“Take away Fannie and Freddie, or regulate them more wisely, and it's hard to imagine how these highly liquid markets would ever have emerged. This whole mess would never have happened.”

 

Uh, no it isn’t. Taking them away or regulating them more doesn’t change the fact that mortgage service companies are unregulated, or that Credit Default Swaps are unregulated, or that Alan Greenspan reduced interest rates to 1% creating a feeding frenzy and worsening the boom, or that the Commodity Futures Modernization Act of 2000 exempted derivatives from regulation, or failing to adequately oversee ratings agencies that slapped a triple AAA ratings on junk.

 

That article is a hack job.

 

http://online.barrons.com/article/SB121884860106946277.html

http://bigpicture.typepad.com/comments/2008/09/a-simple-explan.html

[Orion]

In the last 8 years REPUBLICANS have controlled EVERY BRANCH of government with the exception of the last 20 months, and NO Government in HISTORY has been bigger. So please stop perpetuating this myth that Democrats = bigger government, Republicans = smaller government.

 

um...

 

im completely aware that the government got huge(er) under dubya

 

you want to quote me? fine, but read what i fuckin said first, moron. now shut the fuck up and let the grown ups talk.

 

a government exists to protect the borders and producers. thats it. a "bigger" government is one that taxes more to do less, passes laws that govern things that it shouldnt be sticking its nose into, takes away choices from its people. examples of "big" government; smoking ban, casino law, social security, medicaid...anything that perpetuates the "handout mentality" of americans. im not even a fan of seatbelt law. should cars have them? hell yes, but i shouldnt be required by law to wear one.

[Science Abuse]

im not even a fan of seatbelt law. should cars have them? hell yes, but i shouldnt be required by law to wear one.

Yes you should. Without your seatbelt, you are a X00lb unsecured load hauling downt he highway at 80mph. If you biff it, I don't want your carcass coming into my vehicle. There have been many deaths from this, you buckle up because you are a projectile.

 

Governemnt protects it's people from what? Everything that threatens their well being, right?

[slow4now]

um...

 

 

 

you want to quote me? fine, but read what i fuckin said first, moron. now shut the fuck up and let the grown ups talk.

 

a government exists to protect the borders and producers. thats it. a "bigger" government is one that taxes more to do less, passes laws that govern things that it shouldnt be sticking its nose into, takes away choices from its people. examples of "big" government; smoking ban, casino law, social security, medicaid...anything that perpetuates the "handout mentality" of americans. im not even a fan of seatbelt law. should cars have them? hell yes, but i shouldnt be required by law to wear one.

 

All of these years and you haven't grown up a bit, I see.

 

Acknowledging the fact that the government has gotten bigger doesn't paint an accurate picture. The government has gotten it's BIGGEST under W. It may sound like nit-picking but when someone makes the argument that they're not voting for O'Bama but rather McCain because they want a smaller government it is an important distinction to make.

 

George W Bush also claimed to want a smaller government with less regulatory power. Well we now have the biggest government in history, Wall Street has been unregulated to the brink of financial collapse, and we're the most highly monitored (regulated if you will) citizens in the history of the US. Oh yeah I hear we're getting into the banking business too. John McCain has offered almost zero opposition to any of this, agreeing with Bush 90% of the time compared to Obama's 47% (Congressional Quarterly).

 

So I guess I'm not sure why you are so certain that a vote for McCain means we'll have a smaller government.

[Scotty2Hotty]

Governemnt protects it's people from what? Everything that threatens their well being, right?

[Orion]

So I guess I'm not sure why you are so certain that a vote for McCain means we'll have a smaller government.

 

well i guess im not sure where i said anything about voting for mccain? in fact, i beleive i said "i dont like him either".

 

as far as the government being the biggest its ever been, well, of course it is. that trend began all the way back with fdr. and it continues to this day. i had this discussion with eric the other day on im. im not a republican. i dont wish to be confused with one. however, i usually vote along those lines, because the main issue with me is "what other things are the government going to tell me i cant do, or regulate for me?" and historically, republicans have favored less regulation, as oppsed to democrats, who favor more of it. mccain is a closet liberal, and im sure the gov. will get bigger under him, but of the two options, its that or a man who has one of the most left leaning voting records in history. are there other issues? sure, but the one that concerns me most is that.

 

eric, please. the seatbelt law was passed because of one thing, money. insurance companies wanted the law so that people cost less to fix, and a bunch of other folks jumped in on the whole "were safegaurding our americans!" tip. sure, it looks good, morally, but its about money. if youre going to justify it by saying "it protects others from your flying severed limbs!", you may as well call for legislation putting fences up around all roads so that no one can hit a deer, or wrapping us all in saran wrap to keep us safe from other peoples germies. if YOU dont want MY carcass coming into your car, then YOU can take steps to prevent that. government not required.

 

and no, a gov't doesnt protect its people form everything that effects their well being. if individuals CHOOSE to do stupid things, then they also CHOOSE to deal with the consequences of those stupid things. lets take the smoking ban for example. having a smoking section in a resturant is like having a pissing section in a pool. i hate smoking. however, if a resturant chooses to have a smoking section, then i will choose to eat elsewhere, and probably write a letter to the corporate office explaining why i chose to do so. eventually, we would have places that catered towards smokers, and places that didnt. see how easy that was? dont want someone smoking all up on your baby? go somewhere else. this is a capitalist society, so vote with your wallet. no need for big brother to even get up in that mess.

[kenny]

I knew there was a reason I liked your black ass.

[caseyctsv]

Ok. I read this article and applied some critical thinking to it since the original poster didn't seem to bother. Blame poor people, blah blah blah.

 

“But really, it isn't. Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.”

 

Nothing like factless colorful language to illustrate a point. Ugh.

 

“Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street's efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.”

 

This is simply not true on every level. 50% of subprime loans were made by mortgage service companies that are not subject to federal supervision. Another 30% were made by banks or thrifts not subject to routine supervision. Not only that but Fannie and Freddie’s biggest problem wasn’t their subprime loans, it was Alt A mortgages (rated better than subprime.) These were loans that were initially given out by other companies which did not attempt to verify income or net worth and were for principal balances significantly higher than what is typically made to low-income borrowers. See: Jose Conseco http://latimesblogs.latimes.com/laland/2008/05/celebrity-forec.html

 

 

“Take away Fannie and Freddie, or regulate them more wisely, and it's hard to imagine how these highly liquid markets would ever have emerged. This whole mess would never have happened.”

 

Uh, no it isn’t. Taking them away or regulating them more doesn’t change the fact that mortgage service companies are unregulated, or that Credit Default Swaps are unregulated, or that Alan Greenspan reduced interest rates to 1% creating a feeding frenzy and worsening the boom, or that the Commodity Futures Modernization Act of 2000 exempted derivatives from regulation, or failing to adequately oversee ratings agencies that slapped a triple AAA ratings on junk.

 

That article is a hack job.

 

http://online.barrons.com/article/SB121884860106946277.html

http://bigpicture.typepad.com/comments/2008/09/a-simple-explan.html

 

You sir are a hack job. Are you seriously going to try to argue that FNMA and Freddie were not the key to this mortgage meltdown? Clearly you have no clue how the mortgage market works. It doesn't matter who originates the loans - these Mortgage Service Co's as you call them - it matters who ends up owning the asset. You see the "Mortgage Service Companies" don't end up owning the mortgage because that would tie up their cash and keep them from making more loans. So the originating company looks for someone to buy the mortgages. Gee who could possibly be in the market to buy these mortgages I have so I can make more loans? You guessed it FNMA and FHLMC. While Fannie and Freddie did not buy all of the mortgage loans the mortgages they did buy allowed the "mortgage servicers" to go out and take bigger risks. For the record, Fannie and Freddie were both buying subprime and Alt A as well - not just conforming.

 

Do I really think the Dems caused all of this? No - it was pure greed. Most politicians are worthless and will only do or say what they need to to keep their cushy 200K a year job. Ever seen the legal history of our Givernment - I had the e-mail around here somewhere - no way to know if it was true or not.

[caseyctsv]

While I don't think the dems are solely to blame - from your article link:

 

Earlier in the current decade Fannie and Freddie successfully fought a full-scale attempt by the White House and some brave Republican legislators to clamp down on their operations, after they were caught perpetrating accounting frauds