We're All Homeowners: Nationalization of Fannie, Freddie Unavoidable

Yahoo ^ | 09 July 2008 | Aaron Task

[durasell]

At this point I’d rather loan money to the local crack head than hedge fund.

[happygrl]

I’d add to both of your suggestions: abolish public education, with the result that property taxes would be significantly lower, which would probably be the equivalent of the mortgage deduction.

[dennisw]

dittos

[happygrl]

The bank is something more than men, I tell you. It's the monster. Men made it, but they can't control it.

Grapes of Wrath by John Steinbeck

[secretagent]

Welfare for the well connected. Aargh!

Where are the Republicans that understand Milton Friedman?

[ex 98C MI Dude]

“Too big to fail... Too big to bail” is how I’ve heard it put.

[secretagent]

...abolish public education, with the result that property taxes would be significantly lower, which would probably be the equivalent of the mortgage deduction.

An even greater benefit: it would destroy a powerful obedience-conditioning tool for the governuts.

[Jacquerie]

Please explain.

[Caramelgal]

In the early 30s a full one third of American banks collapsed and it was this, not the stock market collapse, that did the real damage of the Depression.

Good point. My mother, who was a very young girl at that time, told me that she remembered overhearing her mother and father talking about how the banks were “collapsing”. When she went with her parents to the bank to see if they could get their savings out, she couldn’t understand why the building was still standing. She took “collapse” to mean a literal one and expected to see a big pile of rubble where the bank once stood with people rummaging through the fallen bricks to find their money.

Back then folks like my working class grandparents typically didn’t have anything invested in the stock market. And back then I don’t tnk there were pension plans or life insurance vehicles heavily invested in the stock market like there are now and there were no 401ks and such. A lot of people didn’t even have checking accounts and paid cash for all their purchases but many did have savings accounts, sometimes their entire life savings in banks that before federal insurance were completely wiped out if their bank went under.

[Pelham]

“Back then folks like my working class grandparents typically didn’t have anything invested in the stock market.”

Quite so. Whereas bank savings accounts were widespread. The thousands of banks that collapsed were largely rural banks, which devastated small town America. Joseph Schumpeter wrote that the Depression was much more severe in the US than in Europe, and this was due to a peculiarity in American banking law that prevented interstate branch banking.

In Europe large money-center banks could have branches in rural towns. If there was a run on a bank, the rural bank could get help from its larger parent. In America a run on a small town bank would collapse it. Which led to a greater panic on the part of the public. The panic fed on itself. FDR’s speech “we have nothing to fear but fear itself” was in fact about this very issue, and not the war.

[CharlesWayneCT]

Sometimes it’s the people who keep pointing to places and screaming “fire” that are actually causing the panic. And when they seem to be invested in a way that panic improves their earnings, you might wonder whether they are trying self-fulfilling prophesy in order to make a buck.

It’s worked well for them so far.

[elkfersupper]

FNMA and FHLMC were and are creatures of Congress designed to provide liquidity for home lenders.

Then, their Creator demanded that they provide home loans (including multifamily rental housing) to people who had no possibility or likelihood to pay.

This is a giant social engineering project meeting its inevitable end.

Too bad.

Back in the day when their clients were responsible lenders, it was a good thing.

When they were forced under political pressure to become something else, I predicted their downfall.

I saw this coming as early as 1985.

[LomanBill]

>>socialized housing, owned by the
>>masses for the masses, how nice. :)

 

Socialism