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Old 05-16-2013, 05:42 PM
silver creek silver creek is offline
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Default Re: I'm so tired of getting ripped off!

Quote:
Originally Posted by Diver Dan View Post
Not only did it not hit the nail on the head, it missed the board the nail was in. If you remember this recession, for the first few weeks, was called the Subprime Morgage Meltdown. That was till the press figured out who caused it and they never called it that again, despite the fact the clues to the real culprit was and still is in their original name. They have done a fantastic job of rewritting history and blurring the facts. Try doing some actual research because what the press does is more fiction than truth these days.

One last note. In the 2001 budget request, the president at the time said that there needed to be a grip gotten on what Fannie Mae and Freddie Mac were doing because and I quote, "A collapse of either Fannie Mae or Freddie Mac would have devastating consquences to both the stock market and the economy." Both collapsed.

If you doubt it, I can break out the Cspan video.
I agree. US manufacturing corporations had nothing to do with the last recession which was caused by a financial system meltdown and had nothing to do with manufacturing.

https://en.wikipedia.org/wiki/Subprime_mortgage_crisis

In fact the causes of the financial meltdown go back across both democratic and republican presidencies and administrations.

As you will see, it had very little to do with corporations wanting to increase dividends for stockholders. Rather it was individuals who wanted big Wall Street bonuses, individuals who wanted bonuses for selling mortgages, individuals who wanted a commission for selling CDOs, individuals who wanted to own a home they could not afford, individuals who wanted to flip real estate, and individual politicians who wanted to be re-elected.

The fault lies with our own government that encouraged banks to loan money to poorer and higher risk individuals. They wanted to make home ownership universal which of course it cannot be.

Secondly, the fault lies with Fannie Mae and Freddie Mac, two government housing lenders that made risky loans because the government and Barney Frank ( Democrat - Mass), Chairman of the House Financial Services Committee, wanted them to make housing more affordable.

Thirdly, the fault lies with the mortgage lenders like Country Wide that got rich collected fees for originating mortgages that folks could not afford.

Fourthly, the fault lies with the folks that signed on to Adjustable Rate Mortgages (ARMs) that they did not understand. Who signs a mortgage without doing due diligence? Ignorant people that meet dishonest people.

Fifthly, the fault lies with greedy Wall Street Investment firms that packaged these risky mortgages and sold them as CDOs (Collateralized Debt Obligations).

Sixthly, the fault lies with in insurance companies that like AGI that insured these CDO's so they had the appearance of safe investments. AGI wanted to collect the insurance fees and they collapsed when they did not have enough reserves to cover their obligation to insure these CDOs.

Seventhly, the fault lies with greedy real estate investors and regular folks who bought into the concept that they could flip a house and make gobs of money because housing prices continued to rise. They bought into the greater fool theory.


What is true is that what caused the crisis is greed on the part of individuals, investment companies, banks, mortgage lenders, government, and politicians (greed in the sense they felt they could get the votes of poor people by making mortgages available).

This led to TARP, the government bailout which has been successful in preventing a financial meltdown. I am a fiscal conservative but I was in favor of TARP. It has been a great success. For a cost of 15 billion dollars we avoided a depression (418 - 405 billion dollars). If we can collect another $15 billion of the loans we made, TARP Will have cost the US taxpayer nothing.

"As of December 31, 2012, the Treasury had received over $405 billion in total cash back on TARP investments, equaling nearly 97 percent of the $418 billion disbursed under the program."

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Regards,

Silver



"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy