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yes i blame the people who invested in bundled and chopped derivatives, most likely the never looked at the downside of investing in those purely speculative and volatile instruments. they only looked at the possible profits. derivatives are like commodities, they are quite volatile and you can make a ton of money on them, BUT you can also LOSE a ton of money on them, and a lot faster than you think. but again few investors in these instruments look at the downside.
The problem was the fraud perpetrated when the mortgages were chopped, bundled, and sold under higher ratings than they should have had. The quality of the loans was intentionally misrepresented to the ratings agencies and investors. Subsequent derivatives were based on those fraudulent ratings, and we're all living with the devastating outcome.
No, that language has always been on GSE prospectuses. The GSEs alone were always responsible for paying on the investments they guaranteed, not the U.S. Government.
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Attempts were made to seperate Fannie/Freddie from the taxpayer liability, but we were told that we were no problems, and we were bad bad individuals who wanted to see people starve and go homeless for suggesting such a thing..
They always were separate. What changed was the U.S. Government acquiescing to backstop GSE securities in 2008 when the effects of the fraud reached fever pitch and threatened to wipe out the entire financial system.
The problem is the contraction in the economy after the bubble(s) popped. We have to clear out the debt that was over extended but we can do it at full employment. So up minimum wage to $30 per hr, print a bunch of money and give it to everyone to spend, and tax the payment of interest on debt. These three thing should get you a growing economy, more tax base, a contraction in debt as % of GDP, and 2% unemployment. (if you don't over do or under do the printing of money)
sorry to disappoint you but bush was hardly a conservative.
One of these days, there will be a group willing to accept GWB as one of their own. It is astonishing how a man that unpopular manged to get elected a second time.
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as for you continuing to blame wall street, funny how when people make money in the markets, no one says anything, but let the economy turn sour, and people lose money in the markets, and suddenly its the fault of those evil greedy wall street types that stole our money, and we need to sue those greedy wall street bastards to get our money back, etc.
Whenever somebody suggested that perhaps the Wall Street brokers were a tad overcompensated, we'd be assured that those were rare talents of a rocket scientist caliber, who couldn't be replaced at any cost, and that their compensation was commensurate to the risk. Well, they blew it up. Do they live in cardboard boxes now? No? Then they were systematically overpaid, or, in plainer terms, enriching themselves from the system.
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thats a little like blaming cops when they get killed in the line of duty because some criminal does not want to go back to jail.
No, it isn't "a little" like that. It's not like that at all. Actually, it could hardly be any less like that.
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as i have posted earlier, everyone has to share the blame, from the bankers that created new products, to the brokers that sold those new products, to the people that bought those new products despite the huge risk, to the government who should have been on the ball and prevented those new products from being created in the first place but were surfing the net for porn, to congress who gutted the financial regulations, and then never fixed the problem.
Yeah, here's a bit of problem.
Who fought tooth and nail against any form of government oversight?
Who was supposed to be the professionals here, the ones with deep understanding and - dare I say it - an ethical obligation to maintain good practice?
"Nobody really tried to stop me" is not an excuse for anyone over 5.
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people always forget the caveat, if something seems to good to be true, then it probably is. we had banks pushing sub prime mortgages, and "helping" people who would never have been able to qualify for a mortgage in the first place get those mortgages, and this was encouraged, rather forced, by the government. but the only people that we should punish is wall street?
They're the professionals in the scenario. They're the ones who made money on the entire debacle.
[City Councilman] Righeimer reiterated that a big part of the city's financial woes are owed to ballooning pension fund costs.
Righeimer cited a report from the state Public Employees' Retirement System that he said showed the city has a $134-million unfunded pension liability.
"Meaning, we have no way to pay for it," Righeimer said.
No, that language has always been on GSE prospectuses. The GSEs alone were always responsible for paying on the investments they guaranteed, not the U.S. Government.
They always were separate. What changed was the U.S. Government acquiescing to backstop GSE securities in 2008 when the effects of the fraud reached fever pitch and threatened to wipe out the entire financial system.
Again, there was no fraud. Investors bought the loans because of the guarantee. This was how Fannie/Freddie was able to raise capital at below market rate. Its also why you wont see anyone charged with any crimes because doing so would require lots of documents to get disclosed in court and become a matter of record, which would make public how government helped cause the bubble leading up to the collapse.
The U.S. Government made the decision to guarantee the loans in 2008. They were never obligated to do so. From the article you posted:
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"Prior to conservatorship, Fannie and Freddie were essentially private companies with the backing of the federal government. Though the government was not technically responsible— "The actual legal guarantee was trivial; it’s in the single billions," McDonald says
The U.S. Government actually only legally guaranteed single billions of dollars worth of the multi-trillions of dollars in GSE securities.
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Again, there was no fraud. Investors bought the loans because of the guarantee. This was how Fannie/Freddie was able to raise capital at below market rate.
I've already shown the disclaimer language that has always been printed on the cover of every GSE prospectus indicating there was no U.S. Government guarantee. Anyone assuming otherwise was incorrect until they actually did step in in 2008.
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Its also why you wont see anyone charged with any crimes because doing so would require lots of documents to get disclosed in court and become a matter of record, which would make public how government helped cause the bubble leading up to the collapse.
It's not. Put the blame where it belongs, on CalPERS and the banksters. Stop going after the already tapped out taxpayers!
Exactly. People keep attacking the low man on the totem pole while ignoring the casino atmosphere that has beholden pension fund managers.
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