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Re: The Mortgage Crisis

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@rk9132wrote:

Doing a coy&paste on the same nonsense will not change reality.

- Freddie and Fannie enabled those sub primes,

8,000,000 Americans were driven from their homes by the Banksters not even close. Can you substantiate that or is it one more on the list of "those" facts? Sure. jrbush Recession lasted 2 years, each year, 4,000,000 homes were foreclosed and 1,250,000 businesses were shuttered.

Wall Street also invented "Derivatives" - once again, they were invented in 1848. You seem to come up with a bit of fiction and use it even after it is disproven. Actually, "derivatives" were mentioned in records of private financial transactions as early as 1550, but they had NOTHING to do with the abomination Wall Street created in 2002.

- The government pushed home ownership with negative results:

https://www.orlandosentinel.com/news/politics/os-mike-thomas-minority-housing-0728120110727-column.h...

 

Now, you can copy&paste your whine all you want about Oligarchs, Republicans, Zombie Lies, Banksters, lil donny, etc. but reality is much different and deeper than your class-envy.

 

@gruffstuff wrote:

This is baloney, more than 84 percent of the sub-prime mortgages in 2006 were issued by private lending. The " Government " doesn't require any lender to issue loans to borrowers  that are not credit worthy.

 

The lenders that made the sub prime loans were exempt from federal regulations.

 

That was the cause of the sub prime financial crisis, to little government involvement, not to much.


Total baloney indeed. Once again RK dredges up a rightwing source for his rightwing nonsense. For the record, "derivative trading" was a PRIVATE financial transaction reported as early as 1550, but associating those earlier one-on-one transactions with the absurd toxic LIE called "derivatives" since 2002 is like asserting air travel is unsafe, based on an analysis of DaVinci's codex.

 

And the regulators lil donny has installed in the SEC are allowing a resurgence of derivatives including the infamous Mortgage Backed Securities and Credit Default Swaps which will produce the same effect they did in 2008.

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Re: The Mortgage Crisis

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Doing a coy&paste on the same nonsense will not change reality.

- Freddie and Fannie enabled those sub primes,

8,000,000 Americans were driven from their homes by the Banksters not even close. Can you substantiate that or is it one more on the list of "those" facts?

Wall Street also invented "Derivatives" - once again, they were invented in 1848. You seem to come up with a bit of fiction and use it even after it is disproven.

- The government pushed home ownership with negative results:

https://www.orlandosentinel.com/news/politics/os-mike-thomas-minority-housing-0728120110727-column.h...

 

Now, you can copy&paste your whine all you want about Oligarchs, Republicans, Zombie Lies, Banksters, lil donny, etc. but reality is much different and deeper than your class-envy.

 

This is baloney, more than 84 percent of the sub-prime mortgages in 2006 were issued by private lending. The " Government " doesn't require any lender to issue loans to borrowers  that are not credit worthy.

 

The lenders that made the sub prime loans were exempt from federal regulations.

 

That was the cause of the sub prime financial crisis, to little government involvement, not to much.

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8,000,000 Americans were driven from their homes by the Banksters who created the disaster

 

 

https://www.forbes.com/sites/johnwake/2018/07/23/5-reasons-home-prices-are-falling-in-australia/#448...

 

5 Reasons Home Prices Are Falling In Australia

 

Looks like the same thing is happening in Australia as we speak, I suspect banks are going to get a bailout, tax payers are going g to eat it, and the bottom 99 % will come out poorer.

 

It might actually be worse then the 2008 US bubble, they used private contractors as inspectors, so in addition to the bubble they also have new construction that is falling apart and basically unsafe to live in, and people paid huge prices, a million plus for a home, and now that can't live in them, and they can't sell them. They're just screwed up, down, sideways and forever, just wiped out.

 

It might effect world economy as well.

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@rk9152 Class envy???   LMAO....No, I certainly have absolutely no desire to be like that GREED!

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@Controlled42010 wrote:

The pyramid schemes still gain, no?

 


@Olderscout66 wrote:

More irrational defense of Republican Zombie Lies coming from the far right, s while those lies have nothing to do with the topic, here's why they're lies:

 

The Housing disaster had NOTHING to do with jrbush wanting to encourage wider home ownership, it all began when neoRepublicans agreed to two successive balanced budgets submitted by Clinton that wound up handing jrbush a $300BILLION SURPLUS instead of the $1.4TRILLION DEFICIT he handed over to President Obama.

 

Worked like this: US Treasuries have amazingly low interest rates because EVERYBODY knows they are 100% safe and secure, so foreign central banks and wealthy individuals buy however many we issue. But when there's no DEFICIT, we don't issue new treasuries, so the ones holding the dead presidents we sent them as a result of our trade deficit had nowhere SAFE to put those "profits".

 

Enter the Real Estate Bond Market. To meet the demand for investment in SAFE things, Wall Street invented the Mortgage Backed Security MBS, which was like a mutual fund containing thousands of what had until then been the safest investment after US Government bonds and bills - Home Mortgages.

 

The demand for these hither-to safe as money investments was insatiable - they paid more than the US Treasuries that were no longer available (because of the balanced budget we didn't need to sell bonds to finance our Government) and for the past 30+ years had been just as secure.

 

The amount of mortgages was less then the demand for the MBS, so the banksters and Wall Street -NOT THE GOVERNMENT- reduced the requirements for a person to obtain a mortgage. This drove up demand for houses faster than they could be built (faster than the Supply could expand), so the PRICE of homes was driven up at record rates.

 

People who owned homes saw the value of their property skyrocket, and began to "refinance" taking out second and sometimes third mortgages to pay for a lifestyle they never dreamed they could have. Foreigners continued to snap up all the MBS Wall Street and the Banksters could assemble, and the cycle became self-feeding. To meet the insatiable demand, Banksters invented "sub-prime mortgages" which they rolled into their MBS bundles, figuring the increase in home prices would forever permit anyone who could not pay their mortgage to simply refinance based on the inflated home price.

 

While all this was going on, Wall Street also invented "Derivatives", which are basically a system where an existing asset is cut into many pieces and those pieces are re-assembled into investments with a higher value than the assets from which they were assembled. That is, their value was DERIVED from some element of the existing asset that was judged to have some intrinsic value, such as the interest portion of a mortgage payment or the principal portion of the same mortgage or even the expected increase in the value of the home which secured the mortgage. Thus a $250,000 mortgage would be split up and the pieces resold for (e.g.,) $300,000. Wall Street did the same thing with other investments, getting rich on the "commissions" and selling their Frankenstein Paper on to the next bigger fool as soon as possible so they'd have the cash to do and even bigger Derivative deal.

 

Warren Buffet told the World these new "financial instruments" were actually Monetary Weapons of Mass Destruction that could not be sustained, and once again the Oracle of Omaha was RIGHT.

 

8,000,000 Americans were driven from their homes by the Banksters who created the disaster. Those homes were bought by other Banksters and turned into renatl property, stealing the dream of home ownership from a generation of Americans, and ending the chance millions of Americans will ever be able to pass any significant wealth on to their children. Meanwhile lil donny Bonespurs wants the Uberrich to pass their entire fortune to the next generation WITHOUT being taxed. That ability to pass fortunes to their children was an essential part of Feudalism and Republicans want a new feudalism with the Corporate Oligarchs becoming the Lords and the rest of us being their serfs.

 

Dodd-Frank stopped MOST of these scams, but Republicans are working night and day to undo the protections so their owners on Wall Street can rape and pillage the middle class as soon as possible.

 

 


 


Doing a coy&paste on the same nonsense will not change reality.

- Freddie and Fannie enabled those sub primes,

8,000,000 Americans were driven from their homes by the Banksters not even close. Can you substantiate that or is it one more on the list of "those" facts?

Wall Street also invented "Derivatives" - once again, they were invented in 1848. You seem to come up with a bit of fiction and use it even after it is disproven.

- The government pushed home ownership with negative results:

https://www.orlandosentinel.com/news/politics/os-mike-thomas-minority-housing-0728120110727-column.h...

 

Now, you can copy&paste your whine all you want about Oligarchs, Republicans, Zombie Lies, Banksters, lil donny, etc. but reality is much different and deeper than your class-envy.

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The pyramid schemes still gain, no?

 


@Olderscout66 wrote:

More irrational defense of Republican Zombie Lies coming from the far right, s while those lies have nothing to do with the topic, here's why they're lies:

 

The Housing disaster had NOTHING to do with jrbush wanting to encourage wider home ownership, it all began when neoRepublicans agreed to two successive balanced budgets submitted by Clinton that wound up handing jrbush a $300BILLION SURPLUS instead of the $1.4TRILLION DEFICIT he handed over to President Obama.

 

Worked like this: US Treasuries have amazingly low interest rates because EVERYBODY knows they are 100% safe and secure, so foreign central banks and wealthy individuals buy however many we issue. But when there's no DEFICIT, we don't issue new treasuries, so the ones holding the dead presidents we sent them as a result of our trade deficit had nowhere SAFE to put those "profits".

 

Enter the Real Estate Bond Market. To meet the demand for investment in SAFE things, Wall Street invented the Mortgage Backed Security MBS, which was like a mutual fund containing thousands of what had until then been the safest investment after US Government bonds and bills - Home Mortgages.

 

The demand for these hither-to safe as money investments was insatiable - they paid more than the US Treasuries that were no longer available (because of the balanced budget we didn't need to sell bonds to finance our Government) and for the past 30+ years had been just as secure.

 

The amount of mortgages was less then the demand for the MBS, so the banksters and Wall Street -NOT THE GOVERNMENT- reduced the requirements for a person to obtain a mortgage. This drove up demand for houses faster than they could be built (faster than the Supply could expand), so the PRICE of homes was driven up at record rates.

 

People who owned homes saw the value of their property skyrocket, and began to "refinance" taking out second and sometimes third mortgages to pay for a lifestyle they never dreamed they could have. Foreigners continued to snap up all the MBS Wall Street and the Banksters could assemble, and the cycle became self-feeding. To meet the insatiable demand, Banksters invented "sub-prime mortgages" which they rolled into their MBS bundles, figuring the increase in home prices would forever permit anyone who could not pay their mortgage to simply refinance based on the inflated home price.

 

While all this was going on, Wall Street also invented "Derivatives", which are basically a system where an existing asset is cut into many pieces and those pieces are re-assembled into investments with a higher value than the assets from which they were assembled. That is, their value was DERIVED from some element of the existing asset that was judged to have some intrinsic value, such as the interest portion of a mortgage payment or the principal portion of the same mortgage or even the expected increase in the value of the home which secured the mortgage. Thus a $250,000 mortgage would be split up and the pieces resold for (e.g.,) $300,000. Wall Street did the same thing with other investments, getting rich on the "commissions" and selling their Frankenstein Paper on to the next bigger fool as soon as possible so they'd have the cash to do and even bigger Derivative deal.

 

Warren Buffet told the World these new "financial instruments" were actually Monetary Weapons of Mass Destruction that could not be sustained, and once again the Oracle of Omaha was RIGHT.

 

8,000,000 Americans were driven from their homes by the Banksters who created the disaster. Those homes were bought by other Banksters and turned into renatl property, stealing the dream of home ownership from a generation of Americans, and ending the chance millions of Americans will ever be able to pass any significant wealth on to their children. Meanwhile lil donny Bonespurs wants the Uberrich to pass their entire fortune to the next generation WITHOUT being taxed. That ability to pass fortunes to their children was an essential part of Feudalism and Republicans want a new feudalism with the Corporate Oligarchs becoming the Lords and the rest of us being their serfs.

 

Dodd-Frank stopped MOST of these scams, but Republicans are working night and day to undo the protections so their owners on Wall Street can rape and pillage the middle class as soon as possible.

 

 


 

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Pretty much the same thing, only in a one minute video.

 

The Great Recession in One Minute:

 

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Freddie and Fannie were major contributors due to their efforts to get more people into homes they could not afford. There were many other elements and mistakes, but that was the basic problem. 

 

The "Global Financial Crisis"


2008–2011 Icelandic financial crisis


The Icelandic financial crisis was a major economic and political event in Iceland that involved the default of all three of the country's major privately owned commercial banks in late 2008, following their difficulties in refinancing their short-term debt and a run on deposits in the Netherlands and the United Kingdom.

Relative to the size of its economy, Iceland's systemic banking collapse was the largest experienced by any country in economic history.
(No one in Iceland was blaming Fannie Mae and Freddie Mac)


In the U.S.
New Century went bankrupt. So did Bear Stearns, Lehman Brothers., Bank of America, Washington Mutual, Indy Mac, and Countrywide Financial.


August 9, 2007: BNP Paribas, a French investment bank, blocked withdrawals from two of its hedge funds – a clear sign that banks were refusing to do business with each other.


The Federal Reserve took over American International Group (AIG).


September 21, 2008: Goldman Sachs and Morgan Stanley converted themselves from investment banks to bank holding companies to increase their protection by the Federal Reserve.


++++++++++++++++


Deregulation

 

  • President Ronald Reagan signed into law the Garn–St. Germain Depository Institutions Act, which provided for adjustable-rate mortgage loans, began the process of banking deregulation, and contributed to the savings and loan crisis of the late 1980s/early 1990s.
  • In November 1999, US President Bill Clinton signed into law the Gramm–Leach–Bliley Act, which repealed provisions of the Glass-Steagall Act that prohibit a bank holding company from owning other financial companies. The repeal effectively removed the separation that previously existed between Wall Street investment banks and depository banks, providing a government stamp of approval for a universal risk-taking.

(Federal Reserve chairman Alan Greenspan fought to keep the derivatives market unregulated)

 

  • In December 2000, President Clinton signed the Commodities Futures Modernization Act of 2000 into law. Written by Congress with lobbying assistance from the financial industry, it banned the further regulation of the derivatives market.
  • In 2004, the US Securities and Exchange Commission relaxed the net capital rule, which enabled investment banks to substantially increase the level of debt they were taking on, fueling the growth in mortgage-backed securities supporting subprime mortgages.

 

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Message 10 of 11

@Olderscout66 wrote:

More irrational defense of Republican Zombie Lies coming from the far right, s while those lies have nothing to do with the topic, here's why they're lies:

 

The Housing disaster had NOTHING to do with jrbush wanting to encourage wider home ownership, it all began when neoRepublicans agreed to two successive balanced budgets submitted by Clinton that wound up handing jrbush a $300BILLION SURPLUS instead of the $1.4TRILLION DEFICIT he handed over to President Obama.

 

Worked like this: US Treasuries have amazingly low interest rates because EVERYBODY knows they are 100% safe and secure, so foreign central banks and wealthy individuals buy however many we issue. But when there's no DEFICIT, we don't issue new treasuries, so the ones holding the dead presidents we sent them as a result of our trade deficit had nowhere SAFE to put those "profits".

 

Enter the Real Estate Bond Market. To meet the demand for investment in SAFE things, Wall Street invented the Mortgage Backed Security MBS, which was like a mutual fund containing thousands of what had until then been the safest investment after US Government bonds and bills - Home Mortgages.

 

The demand for these hither-to safe as money investments was insatiable - they paid more than the US Treasuries that were no longer available (because of the balanced budget we didn't need to sell bonds to finance our Government) and for the past 30+ years had been just as secure.

 

The amount of mortgages was less then the demand for the MBS, so the banksters and Wall Street -NOT THE GOVERNMENT- reduced the requirements for a person to obtain a mortgage. This drove up demand for houses faster than they could be built (faster than the Supply could expand), so the PRICE of homes was driven up at record rates.

 

People who owned homes saw the value of their property skyrocket, and began to "refinance" taking out second and sometimes third mortgages to pay for a lifestyle they never dreamed they could have. Foreigners continued to snap up all the MBS Wall Street and the Banksters could assemble, and the cycle became self-feeding. To meet the insatiable demand, Banksters invented "sub-prime mortgages" which they rolled into their MBS bundles, figuring the increase in home prices would forever permit anyone who could not pay their mortgage to simply refinance based on the inflated home price.

 

While all this was going on, Wall Street also invented "Derivatives", which are basically a system where an existing asset is cut into many pieces and those pieces are re-assembled into investments with a higher value than the assets from which they were assembled. That is, their value was DERIVED from some element of the existing asset that was judged to have some intrinsic value, such as the interest portion of a mortgage payment or the principal portion of the same mortgage or even the expected increase in the value of the home which secured the mortgage. Thus a $250,000 mortgage would be split up and the pieces resold for (e.g.,) $300,000. Wall Street did the same thing with other investments, getting rich on the "commissions" and selling their Frankenstein Paper on to the next bigger fool as soon as possible so they'd have the cash to do and even bigger Derivative deal.

 

Warren Buffet told the World these new "financial instruments" were actually Monetary Weapons of Mass Destruction that could not be sustained, and once again the Oracle of Omaha was RIGHT.

 

8,000,000 Americans were driven from their homes by the Banksters who created the disaster. Those homes were bought by other Banksters and turned into renatl property, stealing the dream of home ownership from a generation of Americans, and ending the chance millions of Americans will ever be able to pass any significant wealth on to their children. Meanwhile lil donny Bonespurs wants the Uberrich to pass their entire fortune to the next generation WITHOUT being taxed. That ability to pass fortunes to their children was an essential part of Feudalism and Republicans want a new feudalism with the Corporate Oligarchs becoming the Lords and the rest of us being their serfs.

 

Dodd-Frank stopped MOST of these scams, but Republicans are working night and day to undo the protections so their owners on Wall Street can rape and pillage the middle class as soon as possible.

 

 


The Gingrich balanced budget had nothing to do with the collapse of the housing market - the bubble was artificially created by the government and burst.  Freddie and Fannie were major contributors due to their efforts to get more people into homes they could not afford. There were many other elements and mistakes, but that was the basic problem. 

 

So, you can rant about "Republican Zombie lies" or you can start with the basic realities and build from there.

 

And, BTW the deficit you mentioned left out a key element - 9/11.

 

Your idea of Wall Street inventing derivatives in the middle of all this is just one more of 'those" facts - totally unrelated to reality. They began in 1848.

 

Educate yourself about Freddie and Fannie (solely to blame- no; part of the package - yes

https://www.thebalance.com/did-fannie-and-freddie-cause-the-mortgage-crisis-3305659

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