Ummm ….. let me suggest learning something about the subject before making any further commentary. I will even help by starting you off in the right direction!
Start here: who was that that set the guidelines for primary lenders so the paper they initiated could be sold on the secondary market? Hint: That would be Fannie Mae/Freddie Mac.
That has nothing to do with the fact that they were given ARMs that would guarantee that the holder of the loan would NOT be able to pay it back. Do you honestly think that the
opportunity to get a loan caused the sub prime crisis? I think that you do, because your whole mortgage crisis theory hinges upon it. I think that you also believe that predatory lending doesn't exist and all of those poor folk got the loans that they deserved... that is your fucking point.
The poor folk got the loans that were comin' to them.
That is some seriously flawed and classist thinking. Poor folk deserve a loan that is humane and ethical... just like the well to do. Don't give me the crap about the whole "risk based pricing" thing. The only thing that was "risky" was to cut a loan for a low income family that has an adjustable rate... that almost
guarantees tha the loan will go into default sooner or later.
Don't forget that in 2005, nearly 40% of all home loans were to vacation homes or for investment purposes (speculators).
South Florida's #1 Source for local TV News (Local10) published an article on March 11, 2005 stating that, "Real estate experts said many buyers are just looking for short-term profit, not a place to live. They're called "flippers" because they sell their condominium contracts before or right after they've closed for a fat profit.
One large bank has just downgraded the stock of WCI, one of Florida's biggest builders, fearing that too many buyers won't be able to close on their units if the real estate bubble bursts.In the past, most building booms in South Florida have gone bust, a recurring cycle."
By 2007 speculators left the housing market.
Keynesian economics describes
3 kinds of speculative borrowing that can contribute to the accumulation of debt that will in turn lead to a collapse of asset values.
1). The "hedge borrower" who borrows with the intent of making debt payments from cash flows from other investments
2). The "speculative borrower" who borrows based on the belief that they can service interest on the loan but who must continually roll over the principal into new investments
3). The "Ponzi borrower", who relies on the appreciation of the value of their assets (e.g. real estate) to refinance or pay-off their debt but cannot repay the original loan.
If you want to blame someone... blame the speculators.
And don't
ever assume that I don't know what I am talking about gobtard.
QFT! Preach it brotha Tripod!
Thank you sister NJ!
You pick out one culprit, likely because McCain thinks he can pin this on Obama. The truth is that Fannie and Freddie are incredibly bipartisan suck ups, and they know how to put a lot in congress into their pocket. (In fact, John McCain has individuals on his campaign staff that *until recently were still on salary* from Fannie/Freddie.)
That was AMAZINGLY well said sir!!!! :smile: