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Indirectly, yes. From Fannie Mae's former chief credit officer...
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CRA and GSE Act promoted "innovative or flexible" lending practices such as downpayments of 5% or less, acceptance of impaired credit, higher debt ratios and creative definitions of income. This loosened underwriting resulted in total CRA originations and non-overlapping GSE AH acquisitions by the GSEs of $7 trillion over the period 1993-2007. This tsunami of high risk lending spawned and sustained a housing bubble unlike any this country has ever seen.
Why did GSE Act and CRA's mandated lending have such a huge impact? Historically home prices were determined by supply and demand at a local level. These two acts changed this local dynamic. Both operated nationally, due to the fact the Fannie and Freddie, along with the big banks responsible for the overwhelming majority of announced CRA commitments, were all national in scope. They were not only largely independent of local supply and demand pressures; their loosened credit standards created demand.
So who drove up the cost of housing? The poor? Maybe it's because so many real estate investors were buying properties and flipping them while banks were quietly stealing the future of the middle class. I always wondered about the term "bail out." Isn't that what criminals have to do to get released from jail? However, in this case, there was no trial for the victims.
Regarding cable TV, complete packages with phone, TV & internet run around $150 a month. Are you saying that an extra $1,800 a year is what is destroying the middle class? If a couple works all week and can't afford to watch their favorite football team play on Sunday, wouldn't you agree they're already financially strapped? By including cell phones, are you are saying that the middle class shouldn't keep up with technology? Wouldn't that make even a larger gap between the classes? I can't imagine leaving my home without one. What if I were on the interstate and got a flat tire? Oh, I see. Only the wealthy should be able to call for help from their cars.
Regarding a car for each person, when I was growing up, many families were able to get by on one income. How can 2 working people make a living without reliable transportation? Most areas I've lived in don't have adequate public transportation. Perhaps if our taxes were used to improve that situation instead of spending trillions on wars, it wouldn't be necessary to own a car just to get to the supermarket. Yes, just let the poor and the middle class walk & hitchhike and the wealthy can drive around in their Aston Martins.
True. I can list a lot of things that didn't exist 20 or 30 years ago. Paying $300 for a medical consultation is one of them. Last time I got a root canal it was twice as much as the one 5 years earlier. Just one crown is $1,000 so if you have a bad abscess and need a root canal, post and crown, it costs about $2,000 for one tooth. So I guess only the rich should have nice teeth and the rest of us should get them yanked.
I was in the hospital in May with a fractured pelvic bone and my bills totaled more than $22,000. Last year, even with a $10,000 deductible, my premiums were higher than what many people pay for rent. So I now I don't have health insurance. Yup, 20 years ago I had great benefits from my employer and didn't pay anything for insurance. Edit: Just FYI, I am paying off my own bills, not asking for a handout from anyone, just affordable health insurance for every American.
Yesterday I was low on gas and $10 got me a little over 3 gallons. So you're right again. 30 years ago I could have filled up my car for $10 bucks. I also bought a brand new car for around $6,000 and paid around $300 a year for full coverage. In fact, why not go back 40 years to when I bought a new car for under $3,000 and spent about $5 a week for gas. You know, we're both being silly. Why have cars at all? Let's go back to the good old days. I mean, who needs a washing machine anyway? My parents didn't even have a refrigerator or hot water.
So, let me ask you this. What are you doing posting on the internet if you long for yesteryear?
Why isn't anyone answering the question when I've asked many times on this forum. Weren't the wealthy doing just fine under the Clinton administration?
Yes, until the dot.com bubble burst. And actually, the income gap grew under the Clinton Admin and narrowed under the Bush Admin:
http://upload.wikimedia.org/wikipedia/en/b/b1/BeforetaxfamilyincomemeanUS1989-2004.gif (broken link)
Source: Federal Reserve, 2004
Why isn't anyone answering the question when I've asked many times on this forum. Weren't the wealthy doing just fine under the Clinton administration? Since then their income has grown dramatically while the middle class income has shrunk. Why? Because "trickle down" doesn't work.
Nobody said anything about taxing the wealthy 95%. You are exaggerating to make your point. The wealthiest 2% will still be paying less than they were 50 years ago.
I do agree that many people are getting handouts and aren't paying their fair share, however. I've met a lot of people on SSDI who could be working and others who haven't even bothered to look for a job in 2 years. However, I don't believe they represent the majority of people who are struggling.
It's a common argument that trickle down does not work. If "trickle down" is a myth, can you answer these questions: 1) Why did so many people lose their jobs when the people at the top starting losing money? 2) When were those people hired? Was it when the people at the top were making predictable profits? If so, then there has to be some merit to the trickle down idea. There are obviously other elements of the economic environment that play into it.
Employees are an additional resource for a business which allows them to have more leverage to provide increased products and services. When the economic environment is positive, it's to the company's benefit to add employees at a particular point in production. A job is not a handout that they're obligated to provide and they don't decide not to hire in an effort to be mean. Employees are a resource that drive more profit under strong economic circumstances.
I'm just curious why a lot of people on this forum protect the rich and argues against raising taxes on them. I doubt that anyone who makes more than 250K would post on the this forum. I doubt that even fewer are people making over 1M.
I can understand rich Republicans who want to lower taxes for the rich. I don't understand the poor Republicans. What do they have to gain from lowering taxes for the rich? If you lower taxes for the rich then you're in effect raising taxes for everyone else.
This is a great thread. I think that a lot of people view themselves as one day becoming "rich," so anything they view as a hindrance to their path they blame on "big government" or "socialists" or fill-in any other Glenn Limbaugh term.
I'm just curious why a lot of people on this forum protect the rich and argues against raising taxes on them. I doubt that anyone who makes more than 250K would post on the this forum. I doubt that even fewer are people making over 1M.
I can understand rich Republicans who want to lower taxes for the rich. I don't understand the poor Republicans. What do they have to gain from lowering taxes for the rich? If you lower taxes for the rich then you're in effect raising taxes for everyone else.
I look it at from another angle. I believe All are entitled to keep what they earned whether it is $1 or $1,000,000.
Also, fairness. The fair thing to do is for all to pay equally their share in taxes. This view has nothing to do protecting others that make more money than I do, take care.
This is a great thread. I think that a lot of people view themselves as one day becoming "rich," so anything they view as a hindrance to their path they blame on "big government" or "socialists" or fill-in any other Glenn Limbaugh term.
i dont necessarily see myself becoming rich one day, though that would be nice, however i do recognize the fact that i never got a job from a poor person, and a poor person never gave me a paycheck.
Regarding cable TV, complete packages with phone, TV & internet run around $150 a month. Are you saying that an extra $1,800 a year is what is destroying the middle class?
The $150 isn't destroying the middle class, but it is certainly a valid example of things we "need" to pay for today that we didn't in previous middle class generations. And yeah, there are an awful lot of families barely getting by where $150/month would make a pretty big difference in paying down debt or accumulating some savings.
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I can't imagine leaving my home without one. What if I were on the interstate and got a flat tire? Oh, I see. Only the wealthy should be able to call for help from their cars.
Yet 20 years ago we survived just fine driving without cell phones. It is a luxury that has become a perceived necessity.
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Yesterday I was low on gas and $10 got me a little over 3 gallons. So you're right again. 30 years ago I could have filled up my car for $10 bucks.
This is silly the price of gasoline is extremely volatile, it isn't something you can take a snapshot in time and declare no longer a bargain.
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I also bought a brand new car for around $6,000 and paid around $300 a year for full coverage.
Inflation adjusted that the $6,000 was about $16,000 in today's dollars. A $16,000 car today will be more reliable, safer, and come with far more features than the one from 30 years ago.
I am all for taxing everyone more. It's not as if people do anything good with the money they earn. Mostly spend it on stupid crap. Why not pay off the national debt?
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