Posted on 09/03/2009 4:39:19 PM PDT by all the best
"The CRA created some demand which was satisfied with higher rate loans."
Only some demand? This must be joke: home-ownership went from 65%, where it stayed for decades, to 69% in just a few years. You are talking about 4% of the U.S. population.
You also misunderstand the role of diffussion and market dynamics. Once the prices started to rise consistently, it changes people's perception of the future, hence valuation of assets. The push created sustained impact on the prices.
"demand which was satisfied with higher rate loans"
Demand can be satisfied only by supply. You should re-read basic economics and, until then, suspend your judgment about matters that you appear to know nothing about.
"The bulk of the real estate bubble however, came from moronic flippers or flipper wannabees"
That is also an old canard: blame the speculators. The truth is, speculators cannot cannot possibly provide sufficient demand for that effect. It is also illogical: speculators buy and sell, hence put both upward and downward pressure on prices.
Last year people of your ilk were blaming oil prices on speculators, which is equally ridiculous: it takes demand from China and India combined to move price from $11 to $146 in just a decade.
"Loans for tract mansions were/are the bulk of the bubble."
I'll stop commenting here. This is pure nonsense.
It is unfortunate, but you indicate no awareness of pertinent facts on any of the points you raise. And yet, you do not ask, just make claims. You want a contest, not knowledge.
OK, you win, I lose. Have a good day.
It was you who brought up the fact that you have numerous degrees, not me. Secondly, yes I do know people who have went to Harvard and MIT. In fact a good friend of my son is a freshman at Harvard this year, on scholarship. Believe it or not a southern boy from GA!
I may be simple in your mind but I know it is better not to spend money I don’t have. I know I should not borrow unless I can pay back. I have to keep my house and finances in check in order to survive. I can’t print money out of thin air, I don’t get do-overs. Average American business owners don’t get bail outs when they run their companies to the ground, they go out of business.
If the Federal Reserve is so essential to our government why all the secrecy? Oh, that’s right, the Federal Reserve has nothing to do with our government, they are a private enterprise that tells US what to do, we have no business looking into their dealings.
This false and, in fact, insane. You asked me a question about sources of my knowledge, and I answered your question. If you read my answer, you'd find that the degree was only one of the many sources I listed. I have subsequently said that, no I was not trying to impress anybody (in fact, I measure people by their character, not degrees); I was only answering your question.
No matter; nothing can help you. As it stands, I am tired of your unfounded insults. Go find someone else to feed you inferiority complex.
Have a good day, Mam.
I never asked you your sources of knowledge, someone else did.
The CRA, Fannie Mae and Freddie Mac are not new to me.
But who engineered all of these things?
Who dreamed up derivatives?
Some backwoods redneck?
No. The Harvard, Yale, Columbia intelligentsia whose ego tells them that they are smart enough to run things better left to a combination of individualism and chance.
But back to the federal reserve....
Which of course I can't possibly critique because I don't have a doctorate...
So I ask another question: Why are all five of Canada's major banks on the list of the most secure banks in the world when the USA has only three? And we are, unless England has passed us, supposedly the financial center of the world with our dollar the world currency?
We should have had a couple of dozen on that list of least likely to have problems.
And of the world's banks, why is our best about half way down the list in rank?
And why has Canada's new job creation numbers increased while ours keeps going to pot?
The bottom line is that there is so much corruption in DC that this country must take some of the power vested in Washington away from Washington and transfer it back to the states as was intended by our Constitution.
Yes, you win, our policy was and still is bad. But the Fed exacerbates that policy with loose credit and the Fed enables the policy (where is the 8k per new homeowner coming from?)
All of these were engineered by Congress, as I already stated.
Incidentally, very few MBAs work for the government.
"Who dreamed up derivatives? Some backwoods redneck?"
No, financial professionals. Now, how does that relate to the point being discussed? No connection (except for what has been drumbed up by the media).
It is much like, having observed a drunken driver endiing up in a ditch, demanding to know, "And who dreemed up the internal combustion engine, the rednecks?"
"No. The Harvard, Yale, Columbia intelligentsia whose ego tells them that they are smart enough to run things better"
If you were present at a single corporate meeting or took a single MBA course, you'd know how silly and void of content your remark is.
"left to a combination of individualism and chance."
Ah, now we got to something: that is the single enduring dissatisfaction with capitalism that has ever existed. Ever since the Enlightenment, precisely because the society is so complex and free markets' hand is often invisible, people were saying, "There must be a better way."
They differed only in that "better" way --- socialists, communists, fascists (corporatists), etc.
It's your prerogative what to believe in. The question I have, what are you, a socialist, doing on this board?
"But back to the federal reserve.... Which of course I can't possibly critique because I don't have a doctorate..."
What do doctorates have to do with that? You can learn about its functioning without a degree. But you do have to substantiate your criticism with facts and logic --- otherwise the discussion differs little from an oriental bazaar.
"So I ask another question: Why are all five of Canada's major banks on the list of the most secure banks in the world when the USA has only three?"
That is a very good question indeed. I do not know a complete answer to that question, but it appears that this is a consequence of the absence of some idiotic regulation, such as mark-to-market.
The same, incidentally, has been the case during the Great Depression. At that time, there was also idiotic regulation such as prohibition for banks to open branches (!) and conduct business outside of 50 mi radius (yes, it is hard to believe). Canada was free from that idiocy.
But there is also a bit of a problem in the way your question is posed: it tacitly assumes that the quality of a an institution is its performance on the worst day. It is quite clear that someone who does nothing does not get in trouble. They point is, of course, that it is long-term performance --- of banks, constitutional systems, securitizations, etc. -- that matters. And the American banks have performed just as good or better than Canadian.
"And we are, unless England has passed us, supposedly the financial center of the world with our dollar the world currency?"
You once again misuse and misunderstand the words. We are a financial center not because of our banks but because 40% of all quities are traded in NY.
Out currency is the "world currency" not because of what the Fed does or does not do but because we are politically stable as a country.
"And of the world's banks, why is our best about half way down the list in rank?"
The answer it already given: the one that undertakes risks has greater highs and often greater lows. Islamic banking withstood the crises quite well --- would you want to adopt it long-term, can you compare progress in our prosperity with that of the Islamic world?
It is a mistake to analyze social institutions by looking at a single point in time.
"And why has Canada's new job creation numbers increased while ours keeps going to pot?"
This is largely because elements of socialism have been long present in Canada, and ours are only now introduced. In the minds of small businessmen --- our main job creators --- this create a great deal of uncertainty. The same has occurred under the FDR; in fact, socialist measures promulgated by FDR is what turned a recession into a prolonged and deep depression (even the German Nazis did better in terms of employment). The bottom line is that there is so much corruption in DC that this country must take some of the power vested in Washington away from Washington and transfer it back to the states as was intended by our Constitution.
"The bottom line is that there is so much corruption in DC "
Completely disconnected from anything you said before. You appear to have a laundry list of grievances and looking for easy scapegoats, rather than studying the issue and suspending judgment until you did. Like many like-minded people, you are already getting your wish. Hope you will like it. Germans did the same in 1929 blaming "Jewish speculators" for the crash, their loss in WW I, and everything else under the sun. The Russians in 1917 were also very dissatisfied with the authoritarian tsarist regime. Most of Africa adopted socialism as well, which is why it is in as bad or worse of a shape than when they were colonies. This is what happens when people are moved by dissatisfaction and seek simple "common sense" solutions to complex problems: they cut their own legs.
"For every complex problem there is a simple solution, which is usually wrong" --- A. Einstein.
My time limitations prevent me from contributing further. Thank you for your posts.
You are a highly educated idiot troll.
First, What I pointed out is exactly the opposite of a socialist.
I plainly stated that only an egotistical member of the intelligentsia would believe that he could device an economic plan that would work better than individualism and blind luck.
This country was built on individualism and blind luck.
As for the rest of your crap, it is not worth commenting on because it is all as asinine as accusing me of being a socialist.
You are a troll with an education.
You might want to comment so as to impress the other posters here with your genius, but it will be wasted on me as I am done.
I am embarrassed at having fed a troll thus far.
No more.
Have a good day, too.
I wish you said that: I would not be writing so much, and you wouldn't be upset.
What you actually said is what every socialist has ever said. And this is what caused me to react the way I did. Especially with so many people on this board who are conservative in everything but economics.
I regret it has come to such outcome: if my extensive writing and time investment in our discussion is not a sign of respect to you, then nothing will help. Have a good day.
You have a great point!
Ten years to get a PhD, $50,000
Twenty years reading research papers, better than funnies, I guess..
Posting this for all to see, priceless.
PS, you over-educated illiterate, don't end a sentence with a proposition.
"Posting this for all to see, priceless."
I am glad you enjoyed it so much.
Thank you also for upholding high standards of discourse by quoting commercials. "PS, you over-educated illiterate, don't end a sentence with a proposition."
This is a valuable correction indeed; your remarks go to the very heart of the matter being discussed.
Of course, when you speak on a subject you know nothing about (me, in this case), it is unsurprising what a fool you make of yourself. Why do you assume, for instance, that English is my native language?
All we can learn from your post is that you have (i) no idea what education is and (ii) exhibited envy and inferiority complex.
Continue to take courses in spelling and grammar, my friend. You are still unprepared for courses in logic.
Take your pompous self over to DU. They hate common sense and love big words, especially if they mean nothing. You stand damned by your own words.
SG: Take your pompous self over to DU. They hate common sense and love big words, especially if they mean nothing. You stand damned by your own words.
Thank you for proving my point. Can you discuss internal combustion in your car in terms of common sense? Of course not: common sense may be sufficient for driving a car but not for understanding of how it works or how to build it --- one needs some physics for that. Your body is "common sense," something usual for you. But is common sense enough for understanding of how it works or how to fix it? Of course not: some biology, chemistry and medicine is needed for that.
The same is with the functioning of the Fed: some understanding of economics and finance is needed.
Do you suggest that all doctors, physicists and chemists are pompous just because they try to use their knowledge (and not only common sense) and must go to DU? According to you, people cannot be possibly conservative and should even be unAmerican merely because that say that (a) certain issues, such as the functioning of the Fed, are complex and (b) knowledge is therefore needed.
It's like telling you to go to DU because you are a SanswicheGuy, presumably a deli expert. To quote you, "You stand damned by your own words."
Well, I stand by my words: I feel sorry for anyone who thinks that you can design a car, cure an illness and reform a Fed by common sense.
You should control that temper, my friend: before you go into a fight and exile your fellow conservatives to DU, it helps to understand what the conversation was about and what actually has been said.
The truth about what?
Ever taken out a mortgage? Car loan? You created money.
Did you get the okay from Greenspan? Shhhh.....your secret is safe with me.
Stealing? Please explain.
Who loans us our own money? Who pays the interest? What do THEY do with the interest?
Into the bank acount of the Treasury.
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