View Poll Results: What Created The 2008 Financial Meltdown?

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  • Greedy Wall Street Investment Bankers /Deregulation of the financial Industry

    37 33.94%
  • Barney Frank, Chris Dodd and the CRA

    32 29.36%
  • Poor people buying houses they can’t afford

    27 24.77%
  • Other

    13 11.93%
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Thread: What Created The 2008 Financial Meltdown?

  1. #41
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by apdst View Post
    That's why Fannie and Freddie were created, as a place for banks to ditch all those bad loans. The government created every bit of the crap.
    The creation of Fannie and Freddie was completely dumb, but that doesn't absolve people in business who did wrong, like those who engaged in making liar loans.
    Along with the toxic asset packaging.

    No one comes out with clean hands, no one.
    I was discovering that life just simply isn't fair and bask in the unsung glory of knowing that each obstacle overcome along the way only adds to the satisfaction in the end. Nothing great, after all, was ever accomplished by anyone sulking in his or her misery.
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  2. #42
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by Harry Guerrilla View Post
    The creation of Fannie and Freddie was completely dumb, but that doesn't absolve people in business who did wrong, like those who engaged in making liar loans.
    Along with the toxic asset packaging.

    No one comes out with clean hands, no one.
    What were the bankers supposed to do, go to jail? Or, just make the dang loan?

    There's on inescapable fact: most of the bad loans would have never been made, if the government had stayed out of it.
    Quote Originally Posted by Top Cat View Post
    At least Bill saved his transgressions for grown women. Not suggesting what he did was OK. But he didn't chase 14 year olds.

  3. #43
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by apdst View Post
    What were the bankers supposed to do, go to jail? Or, just make the dang loan?

    There's on inescapable fact: most of the bad loans would have never been made, if the government had stayed out of it.
    Neither, they shouldn't have been making loans without income verification.
    I was discovering that life just simply isn't fair and bask in the unsung glory of knowing that each obstacle overcome along the way only adds to the satisfaction in the end. Nothing great, after all, was ever accomplished by anyone sulking in his or her misery.
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  4. #44
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    Re: What Created The 2008 Financial Meltdown?

    All of the above.

    - Regulations were loosened more than they should have been.

    - Lenders, unable to rationally control themselves, loaned money to people to buy houses they had no legitimate business buying

    - Borrowers, unable to rationally control themselves, bought homes they had no legitimate business buying.

    I'm sorry, but there is plenty of blame to go around on this one.

  5. #45
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by apdst View Post
    What were the bankers supposed to do, go to jail? Or, just make the dang loan?

    There's on inescapable fact: most of the bad loans would have never been made, if the government had stayed out of it.
    FDIC: Speeches & Testimony - 12/17/2008

    Point of fact: Only about one-in-four higher-priced first mortgage loans were made by CRA-covered banks during the hey-day years of subprime mortgage lending (2004-2006). The rest were made by private independent mortgage companies and large bank affiliates not covered by CRA rules.

    where in the CRA does it say: make loans to people who can't afford to repay? No-where! And the fact is, the lending practices that are causing problems today were driven by a desire for market share and revenue growth ... pure and simple.

    That is why the CRA never set out lending "target" or "goal" amounts. That is why CRA supporters, many of you here today, have labored for three decades to figure out how to do it safely. It makes no sense to give a loan to someone under terms you know they can't pay back. That's a set up for failure.



    Keep in mind, the majority of foreclosures are taking place in middle and upper income neighborhoods. This idea that poor people that make up a small % of the mortgage market are to blame is just basically propaganda. It's to defer scrutiny away from Wall Street because when there's a massive failure on Wall Street, the natural reaction is to ask "Why" and "how do we prevent it in the future" which leads to regulation.
    “Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.” John Maynard Keynes

  6. #46
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    Re: What Created The 2008 Financial Meltdown?

    Someone fed the banks after midnight.
    So follow me into the desert
    As desperate as you are
    Where the moon is glued to a picture of heaven
    And all the little pigs have God

  7. #47
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by apdst View Post
    A person making $2,000 a month has no business taking out a loan with a $1,000 a month note, which is what happened in many cases. At some point, the people who took out loans they knew they couldn't afford must take at least a little responsibility for their actions.
    Absolutely. The number of people willing to take out bad loans, coupled with the number of banks willing to give bad loans resulted in an artificial and entirely unsustainable increase in home values. This resulted in lots of people defaulting on loans they shouldn't have had in the first place and an economy based on bad numbers and imaginary housing prices fell in on itself. None of these homes were ever really worth what they said they were on paper. It was a house of cards that imploded due to bad decisions on everyone's part.
    There is nothing demonstrably true that religion can provide the world that cannot be achieved more rationally through entirely secular means.

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  8. #48
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    Re: What Created The 2008 Financial Meltdown?

    What Created The 2008 Financial Meltdown?
    The Fraudulent Reserve System and such.

  9. #49
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by pbrauer View Post
    Can you back these ridiculous claims up with any evidence? Why would a lender lend money to someone who can't pay them back?
    Because a lot of these lenders were fly-by-night organizations who knew they could off-load the loans to the big lenders as a package. They didn't care if someone couldn't pay the loan back, they were going to be sipping margaritas on a beach somewhere before the loan fell apart.
    There is nothing demonstrably true that religion can provide the world that cannot be achieved more rationally through entirely secular means.

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  10. #50
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    Re: What Created The 2008 Financial Meltdown?

    Quote Originally Posted by Cephus View Post
    Absolutely. The number of people willing to take out bad loans, coupled with the number of banks willing to give bad loans resulted in an artificial and entirely unsustainable increase in home values. This resulted in lots of people defaulting on loans they shouldn't have had in the first place and an economy based on bad numbers and imaginary housing prices fell in on itself. None of these homes were ever really worth what they said they were on paper. It was a house of cards that imploded due to bad decisions on everyone's part.
    Testify, brother! Testify!

    You wouldn't believe how many disagreements I had with friends 5-8 years ago over whether or not their equity was "real". They were adamant that it was. I kept saying it was an illusion based on hype and excitement. They didn't want to hear that.

    Not that I'm some financial guru. Far from it. I just saw nothing real or substantial on which to base the boom in home sales and values. Without a solid foundation (no pun intended), everything will collapse... and it did.

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