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Before the Great Depression, a typical mortgage required a 50% down payment. The borrower incurred the long term interest rate risk as the typical mortgage term was 5 years. The borrower could then either pay it off or refi at the current interest rate.
50% down?? 5 yr mortgage?
No, that is not how things were before the Great Depression.
really? you mean that cutting 22 regulations for every new one put in place had nothing to do with growing the economy? as i have noted many times over the years, every time you put a new regulation on business, it costs money, and usually lots of it. and that my friend hurts business, and thus hurts the job markets, and thus hurts the economy. big corporations can weather heavy regulations, but they dont drive the jobs markets, its the small businesses that drive the jobs markets. hurt small business, and you hurt jobs. let small business expand and jobs grow.
waldo is right. bush43 tried thirteen times to rein in fannie mae and freddie mac, and dodd and frank blocked the effort EVERY TIME. i knew the housing market was doomed the minute sub prime lenders started pushing interest payment only loans, you know the ones that had a balloon payment at the end of ten years equal to the unpaid principle.
as for the fed, they were not using good policies to help control the economy. near zero interest rates, quantitative easing, etc. all hurt the economy in the long run.
Have you forgotten which party controlled Congress? Frank had no power.
Interest only loans substantially predate the Housing Bubble.
No down payment loans substantially predate the Housing Bubble.
No/ low doc loans substantially predate the Housing Bubble.
Sub prime loans substantially predate the Housing Bubble.
FNMA/ FHLMC lost substantial market share as the Housing Bubble inflated because loans no longer qualified.
If the only thing going on at the time was a whole lot of mortgage defaults, FNMA/ FHLMC once had the capital to handle it. Where it went sideways was when FNMA/ FHLMC used their own capital to gorge on private label mortgage derivitives that had been incorrectly rated as investment grade by independent credit rating agencies. They certainly were not alone in ignoring their fiduciary responsibility for due diligence and instead relied on investment grade ratings.
These "misguided " investments made by private and public pension plans, insurance companies, banks, foreign and domestic, Fortune 500 and FNMA/ FHLMC were the primary source of funding sub prime loans. It goosed a heck of a lot of balance sheets for a blip in time.
Not Trump. Can you name one policy that was attributed to Trump that explains job growth? None
I am not a Trump guy but its obvious that Trump has set a positive tone towards American business since winning the White House that has helped job growth. All the indexes that gauge attitudes of business and manufacturing sentiment turned sharply positive since that time. That helps job growth. And the tax plan that was proposed and passed also helped the stock market this past year which also helps job growth.
But I thought the left gave all the praise to Obama regarding the economy?
Bernanke kept denying that there was a serious economic problem even why it was unfolding. Bush gets blamed for the 2008 crash yet Bernanke is blameless?
All Yellen has done is kept interest rates too low. Its causing certain sectors to again overheat and will once again create a bubble that will hurt most Americans when it pops.
Alan Greenspan was way more attune to things than either of the yahoo's you praise.
Last edited by Oklazona Bound; 02-01-2018 at 09:13 AM..
Doesn't get clearer than that. Even a Democrat should be able to figure it out.
Bush would have signed it if he was reelected. Both parties were lock stop on NAFTA. And until Trump came along the GOP was very pro NAFTA like the Dems.
Back in the 1990's Perot was the only candidate against it. And if he had won Trump probably would not be president today. We would still have a strong manufacturing base in the states Trump won in and not be NAFTA ravaged like they are now. But if Perot had won the reform party might be dominating political office today so who knows.
That's one thing that bothered me about Trump/his supporters taking credit for the economy. The Federal Reserve has far more control over the economy than the President, and if (when) the economy tanks again, the blame will go to Trump as well.
The focus should be on the Fed, good or bad...and when it goes badly, we shouldn't fall for the Democrat vs. Republican tribal blame game. It's the Fed.
Another thing that's bothersome, is the tendency of the masses to hold the FRB Chair responsible for interest rates, as if he/ she alone controls it.
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