“In other articles she is advocating the regulation of all Financial institutions, an increase in capital requirements, the banning of all propriety trading and making many current financial tools illegal. This is a Radical departure from the last 40 years of Modern Conservatism.”
I would not consider the last 40 years a ‘conservative’ market. Not sure what you mean by ‘modern conservatism’. I don’t look at the market as conservative or liberal. The policies that help or hinder it could be considered such at times(like the CRA). ‘Free markets’ didn’t use to be solely a ‘conservative’ term until the progressives came along wanting to take people’s property and spread the wealth. After that outrage began, it was the natural thing for conservatives to gravitate towards defending their property from government theft. Free markets..true free markets worked. They kept our economy humming and competitive. This all fell apart, not with a free market,but big government manipulations imho.Can you really blame WS for trying to get ‘creative’ when they were forced to loan money to millions of people that they knew were bad bets on housing and credit cards? I am not excusing them mind you for putting our entire system at risk and now running to the taxpayer to bail them out...but the root of the problem lies with Congress..not the markets imho.
I get tired of the liberals throwing around the term ‘greed’ all the time too. It’s not ‘greedy’ to want to earn the most money you can in life..it’s the responsible thing to do imho. What true greed IS lurking around in the human soul cannot ever be ‘regulated’ out of existence anyway. It’s not a fixed pie. If you didn’t get your ‘share’..go make another pie...lol.
Your clarification on the term ‘securitization’ is appreciated. That has happened to all of my mortgages over the years with each home we bought, but I never knew the term..lol. I just knew they were selling my mortgage to another lender. To a casual observer, ‘securitization’ should mean a way to ‘secure’ your asset or debt with your collateral.I should have googled it before talking about it..lol.
75% of all subprime loans had nothing at all to do with the CRA. In fact, the way the law is written, Banks did not have to do risky lending to fulfill their CRA obligations. 75% of all Subprime loans were not covered by the CRA.
The CRA covered Bank of America did not make a single subprime loan in 2004 & 2005, and in 2006 & 2007 only 2% were subprime. WaMu on the other hand had 5.6 billion in subprime loans.
http://www.ocregister.com/articles/loans-20542-subprime-banks.html
The most important aspect is to find the real culprits of the bubble and the CRA isn’t it. I think the CRA outlived it’s usefulness - but claiming it’s responsible for this mess blinds us to what really happened.
There is no rational way we can claim wall street was run by progressives for the last 40 years, there’s been a steady stream of deregulation. Everything we’ve done has to remove regulation from Wall Street.
But think of it this way, if anybody actually did their jobs we wouldn’t have had this mess. If Mortgage Brokers didn’t write loans they knew would fail, we wouldn’t have had this mess. If Moody’s & S&P said “We can rate this stuff...”, we wouldn’t have had this mess. If the Pension & Mutual fund guys said “Hey, that doesn’t make sense a AAA rating with a really high rate of return?” we wouldn’t have had this mess. So why did they fail to do their jobs?