Posted on 10/10/2008 6:21:32 AM PDT by palmer
If you must publish a vanity blaming the current financial meltdown on the Democrats, then at least read a little about Iceland and understand that the Democrats did not force Iceland into leveraged buyouts of Europe. They didn't force European banks to buy MBS at 48bp above treasuries because someone rated them AAA. They didn't force Greenspan to lower rates, and they didn't force Japan to keep theirs at 0.5% (carry trade unwinding rapidly now).
All those factors above created the environment to make bad economic decisions, first mortgage rates that were too low to reflect borrower risks, but then securities prices that were way to low to reflect systemic risk. The democrats stepped in and forced a system built on sand to be built on quicksand. The result is collapse from deleveraging, although without their meddling the result would have been collapse, but perhaps later.
Got to remember that the economy of the US is the hardrive that runs the world’s economies. If that hardrive goes down, then the rest of the world’s go down.
Cause isn’t all Democrats, but they bear some of the blame. Greenspan kept money way too loose in the 90s and 200s, and that fed hysterical bubble-mania.
There’s lots of blame to go around, I think is the message. Its “madness of crowds” gone bad now, and we’re all part of the crowd to some extent. But at this point, ideology more or less goes out the window. I’m a free market libertarian by temperament and training, but massive government intervention is now necessary, in order to prevent a breakdown of society.
Iceland doesn’t drive the world economy. The U.S. does.
Capitalism has downturns, socialism has Depressions.
Your "first" cause of the mess was initiated by Democrats forcing "affordable" loans to be issued to people that had no capability to repay.
But thanks for playing.
Another vanity about vanities.
Just fan-damn-tastic.
I was going to ask, “is this a vanity?”
and if so, does it conform to the guidelines contained therein?
Someone needs to post a vanity about vanities that set guidelines for vanities.
I’m series.
-of what kind?
That wouldn’t have been too bad, if our wonderful government hadn’t allowed Wall Street to pump them up into trillions of dollars worth of worthless paper.
But I know, can’t meddle in the Free Market. Much better to have to buy it later.
Ask and ye shall receive (though it's dated).
Geez, by following your logic, we’d have to believe that Bill Clinton had nothing to do with the prosperity of the 90’s.
Bless you, sir, for posting that.
That really oughta be reposted in breaking news!
Absolutely true. I would say trillions ultimately, but injected directly into companies, not banks where it will disappear into bad balance sheets. The bad banks can propped up with short term loans while they unwind and die (have to spread it out to avoid collapse). The good banks must be allowed to survive along with insurance companies, etc so give them unlimited Fed loans.
Gotta post and run, but I just got this email:
Forrest Gump explains mortgage backed securities
Mortgage Backed Securities are like boxes of chocolates. Criminals on Wall Street stole a few chocolates from the boxes and replaced them with turds. Their criminal buddies at Standard & Poor rated these boxes AAA Investment Grade chocolates. These boxes were then sold all over the world to investors. Eventually somebody bites into a turd and discovers the crime. Suddenly nobody trusts American chocolates anymore worldwide.
Hank Paulson now wants the American taxpayers to buy up and hold all these boxes of turd-infested chocolates for $700 billion dollars until the market for turds returns to normal. Meanwhile, Hank’s buddies, the Wall Street criminals who stole all the good chocolates are not being investigated, arrested, or indicted.
Mama always said: “Sniff the chocolates first, Forrest!”
The first cause at least for housing was FDR creating the moral hazards of Freddie and Fannie, allowing the dems to play with them decades later. The food for the crisis was cheap credit, without it the dem scheme would have starved.
the government is going to have to take ownership of the financial sector, or there won’t be a financial sector left before long. And if there’s no financial sector, then the recovery of the real economy becomes a matter of decades, not years.
He didn't. He had some centrist policies like reducing welfare but most he was about adding economic inefficiency. The 90's bubble (driven mostly by cheap credit) masked that inefficiency (things like health care mandates).
you’re right about the causes. But now is not the time to fix the issue of cheap credit, now is the time to provide credit.
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