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The federal government will not be indicting anyone because it would require the government to release documents for court that they are not willing to disclose. The government wants people to believe it was Wall Street, not government which caused the crash...
Yes, it was the government, but Wall Street was along for the ride and has been allowed to profit from perpetrating the same fraud, free of fear of consequences. Obama's DOJ won't indict.
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And since Congress authorizes the GSE's, and Congress sets the standards the GSEs operate under, and what limits the GSE's MUST accept,
What was unknown is how bad the economy was going to get.. If Fannie/Freddie ceased to exist, then there would be NO ONE to buy mortgages..
Not true. The GSEs did not buy all the mortgages pre-2008. It was approximately half of them, IIRC. What would have happened is that the GSE practices of low/no down payment loans and shifty 'alternative' credit history acceptances would have come to an end, and the housing bubble would not have inflated as much. Wouldn't we all have been better off if the GSEs had not produced such a reckless housing bubble?
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With or without the legal disclaimers, all investors know the US Govt cant afford to have the securities of GSE's to default. If they allow a GSE to default, they wont ever be able to sell another GSE to another investor again..
Getting rid of the GSEs is not a bad thing, IMO.
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The Fannie/Freddie bailouts were a different program and not at all related to the buying up of toxic assets.. The taxpayers wont get their $200B back until Fannie/Freddie are privatized again because the taxpayers are holding equity/i.e. stock in Fannie/Freddie that needs to be sold off.. this is in addition to the mortgage back security bailouts. The Fannie/Freddie bailouts will eventually return a profit to the taxpayers just like TARP, and the purchasing of toxic assets were..
You're missing the point that the GSEs continueto buy underperforming, defaulting, etc. loans from bank holdings for nearly 100 cents on the dollar as a covert taxpayer-funded back door bailout of the otherwise insolvent banks. GSEs: $1 Trillion Dumping Ground for Bad Bank Loans | The Big Picture
Fannie's and Freddie's losses will continue. They're trying to hide at least $100B in losses by not filing PMI claims because they know the volume of legitimate claims they have would bankrupt the insurance companies and the GSEs would actually then have to take the losses. Fannie and Freddie Hiding Over $100 Billion of Losses? « naked capitalism
I'm so sick of this "at the taxpayer's expense" Moderator cut: language. Government workers are taxpayers, too.
How did that work out for them in Florida? Alvarez raised property taxes to give public employees a raise and 88% of the taxpaying voters angrily ejected him out of his elected office in a recall for doing so.
The taxpayers have spoken pretty clearly on this, the public employee minority cannot keep gouging the taxpaying majority.
Last edited by Green Irish Eyes; 03-26-2011 at 05:16 PM..
Reason: Edited quoted text
I'm so sick of this "at the taxpayer's expense" Moderator cut: language. Government workers are taxpayers, too. And if city services are farmed out to private corporations, the taxpayers are still going to have to pay the price for those services -- for life.
They in an extremely small minority compared to the full tax payers who have chosen all over the country to cut spending. If they want to pool together and pay more in taxes to cover their higher salaries then I'm in full support of that.
Last edited by Green Irish Eyes; 03-26-2011 at 05:16 PM..
Reason: Edited quoted text
As you were educated in the other thread, ALL money they receive comes from REAL taxpayers, since the government, outside of printing money, survives by taxation.
As I was "educated"? BWAH. Don't overestimate yourself. The notion that public employees aren't "REAL" taxpayers is as goddamn offensive as the notion that city-dwellers aren't "REAL" Americans.
As for the rest of your post, I'll just close with this (grammatically incorrect as it is):
You cannot make blanket statements for which you have no clue of what you are talking about.
I think the right has been rather consistant in asking for cuts, while the left keeps asking for more and more..
Everytime the right asks for cuts, we keep hearing about how we want to kill and eat little puppies and support the starvation of little children and want old people to go homeless.. Its nonsense like this keeping any real discussion from taking place..
How 'bout some quotes about cutting defense spending in particular, made before I asked for them today? My very fave Tea Party poster is one that says, "Cut taxes, not defense", showing how dumb some of the TPers really are about how govt. works.
Last edited by Katarina Witt; 03-26-2011 at 12:58 PM..
I'll give you that. The public unions/employees should have
been paying more attention to where the money in their
pensions was being invested in - high risk.
But then, the motivation for doing so, was to pay for all
these pensions in the first place
And it's much easier to invest in risky areas when you have a safety net of defined benefits. When your investments tank the tax payers are on the hook for the losses.
Yes, it was the government, but Wall Street was along for the ride and has been allowed to profit from perpetrating the same fraud, free of fear of consequences. Obama's DOJ won't indict.
They arent going to indict Wall Street for playing by the stupid rules set by the government.. It was the GOVERNMENT that created the policies and the standards. Wall Street just ran off the policies that were in place. Thats why there is no one to indict..
Their lawsuit was because the books were cooked in order to make it appear the profit was higher than it was.. And since their pay was tied to performance, they received a higher pay than they were justified to receive. This is why they were returning the money, yes under a lawsuit. The lawsuit has nothing to do with Congress..
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Originally Posted by InformedConsent
Not true. The GSEs did not buy all the mortgages pre-2008. It was approximately half of them, IIRC.
But if they stopped buying 1/2 of the mortgages, then there wouldnt have been money to fund the other half.
Bank loans money to someone to buy a home.. Fannie/Freddie buys these mortgages reinbursing the bank for the loan.. Then bank now has money to reloan.. Without this sale of the mortgage to Fannie/Freddie, you wouldnt have had enough money to supply the demand for housing and no one could get a mortgage. Could you imagine the effects on the housing market this would have had? We had very little housing activity taking place as it was, imagine if that was cut in half..
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Originally Posted by InformedConsent
IIRC. What would have happened is that the GSE practices of low/no down payment loans and shifty 'alternative' credit history acceptances would have come to an end, and the housing bubble would not have inflated as much.
That depends.. It wasnt the low/now down payment loans which caused the problems, it was that those getting the mortgages couldnt what was being given out. Even 80/20 mortgages work under certain scenarios.. For example. I bought a $4M property last year using an 80% mortgage.. The other 20% came from private investors who receive monthly payments. While the 20% isnt a mortgage, the same idea applies. This was a save mortgage because the tenants are paying rent, enough to substain the monthly payments. They also agree to rebuy the property from me in 10-15 years, so for me it was a $0 down mortgage, with profit in the 7 figure range in a period of time. This deal would have been fine if I got a 100% mortgage from the bank as well.
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Originally Posted by InformedConsent
Wouldn't we all have been better off if the GSEs had not produced such a reckless housing bubble?
I'm no fan of GSE's. I wish they were NEVER created.. I wish banks that made loans were liable to hold onto those loans until they were paid off, or sold on the private market. What the GSE's did was change the equation as to how to operate.. It changed the standards from Do you qualify for the mortgage you are asking for, to can I sell this mortgage. This change is what caused the complete collapse of the financial industry and its why the Obama financial reform bill was a total sham.. It did very little to return back to the previous standards.. If I loan you money, then I dont care if you pay me back as long as someone else agrees to pay me back. Some might say that it even made matters worse because it expanded the powers of the federal government to now bail out hedge funds and other financial mechanisms.. This of course means that if your hedge fund goes bankrupt, along comes Uncle Sam to save the day.. Its a complete joke..
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Originally Posted by InformedConsent
Getting rid of the GSEs is not a bad thing, IMO.
Completely agree.. it would stabalize the market for the long term by making those loaning money liable for the losses, so they will review the loans in greater detail..
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Originally Posted by InformedConsent
You're missing the point that the GSEs continueto buy underperforming, defaulting, etc. loans from bank holdings for nearly 100 cents on the dollar as a covert taxpayer-funded back door bailout of the otherwise insolvent banks. GSEs: $1 Trillion Dumping Ground for Bad Bank Loans | The Big Picture
i'm not at all missing the point.. Without the GSE's buying these loans, the banks would have had no operating capital and gone under. Again, I didnt like the fact that this step needed to be taken, but that doesnt change the needs..
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Originally Posted by InformedConsent
Fannie's and Freddie's losses will continue. They're trying to hide at least $100B in losses by not filing PMI claims because they know the volume of legitimate claims they have would bankrupt the insurance companies and the GSEs would actually then have to take the losses. Fannie and Freddie Hiding Over $100 Billion of Losses? « naked capitalism
Yes, but these losses had nothing to do with buying of toxic assets. The buyup of toxic assets was orchestrated by the Treasury Department and funds were kept seperate.
They arent going to indict Wall Street for playing by the stupid rules set by the government.. It was the GOVERNMENT that created the policies and the standards. Wall Street just ran off the policies that were in place. Thats why there is no one to indict..
I disagree. The government and Wall Street both committed fraud.
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Their lawsuit was because the books were cooked in order to make it appear the profit was higher than it was.. And since their pay was tied to performance, they received a higher pay than they were justified to receive. This is why they were returning the money, yes under a lawsuit. The lawsuit has nothing to do with Congress..
You said the GSEs were operating under the standards set by Congress. Apparently, Congressional operating standards permitted such book cooking to happen.
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But if they stopped buying 1/2 of the mortgages, then there wouldnt have been money to fund the other half.
Bank loans money to someone to buy a home.. Fannie/Freddie buys these mortgages reinbursing the bank for the loan.. Then bank now has money to reloan.. Without this sale of the mortgage to Fannie/Freddie, you wouldnt have had enough money to supply the demand for housing and no one could get a mortgage.
Fewer would be able to get a mortgage, not no one. And as I said, as such, the housing bubble would not have been as extreme.
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I'm not at all missing the point.. Without the GSE's buying these loans, the banks would have had no operating capital and gone under. Again, I didnt like the fact that this step needed to be taken, but that doesnt change the needs..
What's the problem with letting poorly run banks fail?
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Yes, but these losses had nothing to do with buying of toxic assets. The buyup of toxic assets was orchestrated by the Treasury Department and funds were kept seperate.
You're still not getting it. The shedding of bank held bad loans onto the taxpayers via selling them to the now taxpayer-backstopped GSEs continues to this day, and will continue for some time to come until nearly all the bad loans are purged from the banks. It's an ongoing covert back door bailout of the otherwise insolvent banks.
I'm so sick of this "at the taxpayer's expense" Moderator cut: language. Government workers are taxpayers, too. And if city services are farmed out to private corporations, the taxpayers are still going to have to pay the price for those services -- for life.
Not to mention the fact that you completely ignore the fact that the state had a fiduciary responsibility that they are failing to meet. How that becomes the worker's fault is beyond my comprehension.
Not to mention that you seem to be operating under the false impression that the average public employee, or their unions, had any choice about "getting out". Just because you put the word 'fact' in ALL CAPS, doesn't make it one. It's mind-boggling. After all these months of discussion and debate on this issue, you're still holding onto the notion that public employees didn't pay into their pension plans. They did. They not only paid in a percentage of their salary in many cases, but they also deferred current salary increases to future payments in the form of pensions. That's exactly the same thing as contributing their own money into the pension. "I'll forgo a 5% COL raise now, for a 2% raise in my current salary, in exchange for 3% going into my pension fund." That's a contribution.
That is one of the biggest piles of horse manure I've ever read here. I've started 2 businesses; one for myself and one for my husband. There was absolutely no regulation, let alone "out of control regulation", nor "unfair taxes" that prevented us not only from doing so, but from profiting. Blaming government for your inability to start a business is a crock of crap.
Did you start businesses, or are you self employed? Very big difference with regards to government regulation.
And I guess I should have clarified - I'd never start a business in CA, because of over-regulation. One example - an't have delivery trucks idling outside of your business, must convert trucks at great expense to those same trucks. What do you think it will do to commerce down the road?
I am starting a business - just not in CA.
Last edited by Green Irish Eyes; 03-26-2011 at 05:17 PM..
Reason: Edited quoted text
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