Posted on 03/15/2007 10:59:26 PM PDT by ANTIROCKEFELLER
“Innovation has brought about a multitude of new products, such as subprime loans and niche credit programs for immigrants… With these advances in technology, lenders have taken advantage of credit scoring models and other techniques for efficiently extending credit to a broader spectrum of consumers… Where once more marginal applicants would simply have been denied credit, lenders are now able to quite efficiently judge the risk posed by individual applicants and to price that risk appropriately. These improvements have led to rapid growth in subprime mortgage lending,… fostering constructive innovation that is both responsive to market demand and beneficial to consumers.”-- Alan Greenspan, April 2005
(Excerpt) Read more at marketoracle.co.uk ...
Well, load up on Krugerrands, then.
I'm pro-Rockefeller. When I die, I want to go out with a smile on my face like Nelson...not screaming and crying like Megan Marshack.
I prefer gold eagles.
Very deep thinking.
I was with ya in the first half...and then the anti free trade rant. Nafta is not the cause of our problems.
I am not anti-free trade. The current use of the phrase "Free Trade" has nothing to do with free market capitalism. If we were to have an in depth discussion between us regarding what free trade should be, I bet we would both agree.
Perhaps....I would agree that the statements coming out of the bodies of the republic these days are out and out lies.
I heard Larry Kudlow bleating about "subprime lending" on Hugh Hewitt's show a couple of days ago.
How big is the "subprime" mortgage industry? Sure, with consumer lending, from everything to check-cashing spots to your neighborhood loanshark, it's fairly obvious. But who would write an outrageously-risky mortgage, what with personal bankruptcy still (despite recent legal changes) so easy to attain?
"When I die, I want to go out with a smile on my face like Nelson...not screaming and crying like Megan Marshack."
I couldn't find a picture of her, the young guys are probably wondering who she is.
Google news articles regarding sub-prime loans from two years ago. You will see they were touted by the experts as great products. Don't believe the disinformation that sub-prime loans are loans to people with poor credit. A large percentage of sub-prime loans were investor loans or second home loans or 100% LTV loans and many other types that were made to people with strong credit. The bottom line is that the FED made money cheap and easy to create an up business cycle they then tightened the money supply and are creating a down cycle.
I see. Makes sense from an economic POV, but you would then wonder who would accept a subprime instrument for (presumably) speculative/short-term gain.
100% LTV? What responsible, publically-traded institution would write such a thing?
In short, such a thing is plausible, but not as intuitively-tangible as you might believe. There are many competing sharks in the water. Lending is an easy buck for those with liquidity, and a few foreigners are dipping their toes into the US lending market, regardless of our monetarism. Still, I'll keep an open mind. Great article.
Fails to cite sources, unfortunately. 10 percent doesn't really match my (admittedly) anecdotal experience, even with fuel and commodity-pricing fluctuations. I'll cede the housing stat to, perhaps, regional differences between the extremes. Growth is likely best measured in GDP. I just don't see the problem, though I'm glad you pointed my attention to monetarism, certainly. There are likely institutional types who can pocket millions on every announcement from the Fed. Obviously, the publisher is not a big fan of floating, fiat currencies.
He did actually site the source. Here is the link http://www.shadowstats.com/cgi-bin/sgs?
I'm no Rockefeller but I do all right and better than my parents or grandparents. Anecdotal evidence in my own life is much more important to me than stuff I read on the internet.
Another deep thinking comment.
Oh I see...a deep thinker just accepts everything he reads on the internet.
No, you see nothing.
It would help if you used a handle other than "ANTIROCKEFELLER" which sounds like a John Birch Society member and hence not very serious.
So, what is your take on Greenspan's statement?
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