Systemic Failure

Human Events ^ | 3.20/09 | Pat Buchanan

[Luke21]

As the U.S. financial crisis broadens and deepens, wiping out the wealth and savings of tens of millions, destroying hopes and dreams, it is hard not to see in all of this history's verdict upon this generation.

We have been weighed in the balance and found wanting.

For how did this befall us, save through decisions that brushed aside lessons that history and experience had taught our fathers?

It all began with the corruption called sub-prime mortgages.

[Luke21]

Pat does fine when he stays off Israel.

[Toddsterpatriot]

It was the Dukes Joooos.

[unkus]

ping

[Petronski]

Herr Buchanan on economics?

Uh . . . . yeah.

[Kackikat]

To understand what happened with the subprime mortgages and how they infected all the mortgage backed securities learn about Black and Sholes CAPM, which one of them received a Nobel Prize. Now the subprimes were the beginning traced back to Demrats Community Reinvestment Act (Carter Admin), where it was decided to help the “ghetto poor” into a house.

Now the Swiss Bank group decided to creat a new accounting rule that brought lending to a dead stop....there is a thread on that on FR, or you can read it at CanadianFreePress.

The CAPM was full of systemic risk.

[Petronski]

My economics degree is only a BA, but I remember studying Black Sholes back in the day.

[rbg81]

Pat does fine when he stays off Israel.

---

Concur. This was indeed a systematic failure. The problem is that the people who helped cause it are the ones in charge of fixing it. I shake my head in disbelief Obama talks about “taking responsibility” in one breath, then proposes spending trillions in the next. Only a dribbling idiot could miss that contradiction, but (amazingly) people stand up and cheer. I wonder: How could so many supposedly “smart” Americans fall for this? I suspect that Pat is right: we fall for it because our fellow countrymen are morally bankrupt.

[wny]

what’s this “we” crap? I’m like millions of others that work hard, save, invest, borrow and save responsibly...play by the rules..and get screwed over by greedy a$$hole politicians that stay up nights trying to come up with another way to take my money....to transfer it to fools and losers.

[Kackikat]

This kind of bundling into tranches has happened before, and it didn’t work then (one professer said 4-5 times including the S&L bust)...it has huge systemic risk in the arena of the housing bust, and the $40 to 1 that SEC allowed those 6-7 banks to assume. I think that it was a combination of insane Demrat desire to get all poor people into a house they couldn’t afford, and the coming housing bubble bust, along with the greedy Bankers (not just CEO’s or USA bankers) but the real owners of banks that caused a perfect storm to crash our economy. The deriviatives (bets) are part and parcel of those foreign banks (Bildeberger bank owners), and we see that in the billions of CDS’s AIG had to pay off to cover those deriviatives, and which banks got the billions. I believe Sholes died, and Black got the Nobel Prize...or is it the reverse? Anyway CAPM was able to crash capitalism.

[RochesterFan]

Who is John Galt?