Were you not paying attention in 2007? Overlending was part of the foreclosure crisis. One woman came to me for help and when I examined her papers I could see that from the time she applied for the loan to the time it was actually granted, the balloon amount with Deutsche Bank had jumped from 10% to 12.5%. She lost the house. DB continues to be in trouble both financial and legal as explained in great detail in this link, and there is also a good timeline of the 2008 crisis.
The article reports that the European Union has enacted strong provisions so that 2008 does not happen to their entire banking system. We enacted provision for similar reasons and purpose. I don’t know how effective they have been, but the Republican plan is to get rid of them.
If you have not seen the movie “The Big Short” by all means do so. It is about two smart young guys who identified the pending lending crisis in 2007 and shorted a lot of stock on margin and made a fortune in 2008 when the market crashed.
“Were you not paying attention in 2007?”
Are you always this obnoxious when you didn’t read (or didn’t comprehend) what I wrote?
1. I was talking about the current situation, a decade after your snotty comment. Loan requirements have tightened up quite a bit.
2. I very clearly said I haven’t gotten a loan in over 15 years. Therefore what I experienced was long before the Barney Frank housing bill that forced banks to give loans to people (mainly minorities) that couldn’t repay them.
3. My point, which you obviously couldn’t get, was that long before the Barney Frank Bill and long after, I still think banks are lending people way too much money, given they still have to be able to for the utilities, insurance, furniture, food, vehicles, etc.