Quote:
Originally Posted by saganista
Oh, there were plenty of warnings alright. Even by late 2003 and throughout 2004, but these were addressed TO the White House and the Fed, not coming from them.
Not by Democrats they weren't
Another reference to that hack-job YouTube video? You do realize that the actual subject of those hearings was accounting standards, not operating principles. The video editors go to great length to conceal the fact, making their product appear to be something that it's not. The gullible are easily fooled.
Don't know the reference. I don't google much. What you need to understand to understand though is that accounting practices didn't create the mess. They may have hid the mess. What created the mess was a simple suspension of the rules that have served banking well for decades. You can't willy nilly make 105%loans on stated income with 535 credit scores and get anything other than what we have. The most serious lesson of all is the guargantuan losses per unit. Where typically under conventional conservative methods of lending typical losses were 25-30K. The current losses are often 250-300K. Those simple statistics over really relatively small numbers, less than 10%, maybe as low as 5% have created this great mess. Doesn't have anything to do with blaming CRA. It is hard to fail when our socialist brethren set up 1% interest loans for those folks.
And this would be another invocation of Thomas DiLorenzo's insipid thesis that CRA was an underlying cause of the credit crunch? It's phony from start to finish. It's swill cooked up to deflect blame from the real culprits...the gang of laissez-faire cowboy capitalists that Bush et al invited to the party and then sat back and watched as they proceeded to trash the place.
Um...what???
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Yup, you need to step out of your lofty rhetoric and examine that one because therein lies the truth. The money passed from Wall Street through the dupe and to Main Street where it now rests on the balance sheets of the average Joe.
Let me break it down for you. Bob paid 100K for a house and sold it to joe for 150k who sold it to frank for 200k. The house was never worth more than 100K. Who lost the money and who has the money
? That money didn't just dissappear friend!
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