Posted on 09/27/2008 4:10:18 PM PDT by sirchtruth
Alright! I'll grant you this one, but since this is a topic of the day (current event) I thought it would go in "news." My bad, sorry.
"Thank you sir, may I have another?" ;-)
I didn’t say the government didn’t directly cause everything. Businesses can manage to jump to the next step on their own. But they’d never be able to do it and not notice that they weren’t making money without the easy money, and easy money is the state’s baby.
That should be, “I didn’t say the government directly caused everything.”
“The government didn’t come up with negative amortization loans, no documentation loans, interest only loans. The government didn’t force mortgage brokers to give mortgages to people 30 time greater than their income. The mortgage brokers came up with that on their own.”
No, but borrowers salivated at the thought of them. And took them out in HUGE numbers. Here are subprime loans in California only (mostly in the inner-city and out in the Inland Empire). The second number is % ARM.
2001 63.6% 51,719
2002 60.4% 77,827
2003 54.6% 154,601
2004 57.2% 223,690
2005 72.4% 195,118
2006 66.8% 160,612
2007 64.9% 28,831
So, we peaked subprime originations in 2004 with a quarter of a million loans with over half being ARMs. Housing market started to cool in 2005 and ... kaboom!!!!
Why are you having such a problem with this? Go away if you don't want to contribute positively! Btw, it's exaclty why I psoted the question so we wouldn't have to wade thru a myriad of unrelated posts to get to the facts, however you've basically ruined this, ya namby!
Happy to help, FRiend. This has been a h00t!
“Also, borrowers need to receive a large chunk of the blame.”
Borrowers cannot borrow if there is no credit extended to them. Inflation is the problem.
Do we know that most of the $700M is to cover loans made by low income people? I'd expect many middle income and wealthy people could have got over their heads as well. I'd welcome stats along those lines on who defaulted.
But, at the very heart of this problem is our centrally planned monetary system and our banking cartel.
The monetarist economists running the Federal Reserve believe that they're smart enough to predict the economic actions of 300 million people. (Or should I say billions of people, given the new global economy we live in?)
They use their charts and computers and their mathematical models to predict how much money they need to inject into, or remove from the system in order to keep the general price level constant, or growing at a reasonable rate.
The problem is, they mess up sometimes. The housing bubble was enabled by the Greenspan fed's leaving the money spigots open for too long after 9/11.
The easy money essentially fooled a lot of people about the true cost of money, and that led to the bad investments that are clogging up the system now.
I know this sounds like a conspiracy theory, but it's all true. I wouldn't have believed it myself had I not started researching this a few months ago, as I watched my financial stocks tanking. I wanted to know what was happening, and now I know the whole truth... it's quite simply a failure of central planning (exacerbated by several other bad government decisions).
My recommendations to all FReepers is to educate themselves on economics - particularly the Austrian theory of the business cycle (yes, this is what Ron Paul keeps talking about.) The Austrian economists, in my non expert but reasoned opinion, are right... and the monetarist economists running the fed are wrong.
That's why we're in this mess. The monetarists are following a false theory.
Learn more here.
(Warning... you won't like what these libertarians say about the war, but please don't hold that against them. Read what they have to say about economics and decide for yourself. IMO, they're right.)
Amen.
And not just on those who’ve actually defaulted. On anyone covered by the bailout.
B-U-M-P everyone’s accusing me
...if the Feds say you must make loans in certain neighborhoods in order to stay in business and we will buy those loans.... bingo.... EVEN BANKERS CAN FIGURE OUT THE GAME PLAN...
Following the problems in the financial sector in the UK and USA, uncertainty has now hit Japan.
In the last 7 days Origami Bank has folded, Sumo Bank has gone belly up and Bonsai Bank announced plans to cut some of its branches.
Yesterday, it was announced that Karaoke Bank is up for sale and will likely go for a song, while today shares in Kamikaze Bank were suspended after they nose-dived.
While Samurai Bank is soldiering on following sharp cutbacks, Ninja Bank is reported to have taken a hit, but they remain in the black.
Furthermore, 500 staff at Karate Bank got the chop and analysts report that there is something fishy going on at Sushi Bank where it is feared that staff may get a raw deal.
So, borrowers have no responsibility?
If someone takes heroin, do we simply blame the dealer/pusher?
LOL! I guess I just want to cut thru all the crap and post only facts for this one thread. Thwarted, Rats!
Thank you to all those contributing, and a special shout-out to my homegirl, (Yes, I was born in Raliegh, and I own a Creative Spelling, Grammer, and Typo Dictionary) Tax-Chick!!
Let the facts continue. I want names!
LOL! I gonna remember that one!
Not a fair analogy. it is much easier to control credit than it is to control heroin. Usually, banks are more willing to stay within the bounds of the law than drug dealers. It just so happens that in this case, the law did all it could to greet drug dealers with open arms.
Well factually speaking isn't this what the whole bailout plan is all about? Borrows basically getting FREE HOMES and the responsiblity falls on the Gov't which there trying to pass on to us!
I rather go to my neighbor's up the street who I barely see and offer to buy their home for them than give the gov't one stinkin dime for a bailout!!
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