My Predictions Have Come True In Part

[_JS]

You still show such little understanding of the situation Sirs. Lehman isn't bankrupt because Jim Bob can't meet his payments on his ARM mortgage. Lehman purchased high risk, sub prime tranches with their investment pools. These brilliant brokers of capitalism on Wall Street and the City were idiots. They make the dividend speculators of Orange County and Miami-Dade look like lemonade stand owners.

The truth is that no one made these Wall Street firms purchase these debts. Lending institutions got away with these loans, not because of government deregulation as you claim (though you try to make it into a social issue when it was not) but because of Wall Street. This was the failure of the market, absolutely and completely. The lenders would have never made these loans if they couldn't turn right around and sell them to your boys on Wall Street and the City.

You keep answering that you know why Bush and Paulsen are asking for all of this power and money. The truth is that the free market fumbled in a horrific manner and now they require the government to bail them out. This isn't about teaching Jim Bob a lesson in personal responsibility. This is about taxpayers helping CEO's remain comfortable when their screw-ups are destroying our economy.

[Plane]

The proper operation of the free market parts a fool from his money , leaveing most of the money in the hands of the non-fool population.

The spectre of very many homeless fools is so daunting that practly no one is in favor of a totally free market .

The Government is not giveing money without strings , they are demanding some particular fireings and some intrest payment that will transfer the profit to the government on all the loans it is rescueing.

If successfull this move will let most of us operate as normal , noticing only that the availibility of mortguages has become more difficult.

Doing nothing would collapse a critical part of our economy resulting in less confidence from forign investors and a nearly impossible qualifacation and down payment for new mortguages , in few words , very tight money.

I think the Government has done the best thing it could have done faced with this emergency , not the best thing it might have done earlyer to prevent it tho.

From now on 10% down will be a norm , without the bailout , 30%.

[_JS]

The free market is what allowed the subprime mortgage market to exist in the first place. And it is Lehman and the ilk who made the environment possible. Your local bank could never have made these loans. It was the eager purchasing of Wall Street firms that made it possible.

What you all are proposing is an "American Dream" artificially created.

If that is what you want, then why not be honest about it and use the $700 billion to create an authentic housing program instead of tinkering with the market? All you're doing now is going from bubble to bust to bailout.

[Amianthus]

The free market is what allowed the subprime mortgage market to exist in the first place.

Not exactly. Subprime mortgages were forced upon the "free market" by government regulation.

[Xavier_Onassis]

Not exactly. Subprime mortgages were forced upon the "free market" by government regulation.


In what ways were the lenders "forced" to make no money down, NINJA (no income no job or assets) loans?

I do not think the government has the power to force a bank to lend money to anyone. Could they throw them in jail? Tax them at a higher rate? Exactly how could the government force anyone to lend money to bad credit risks?


I DO recall that up until several months ago there were dozens of stupid ads with graphics where the users were supposed to click on the abbreviation of their states on graphics to find out the great refinance rates available from unnamed banks or lenders.

[Amianthus]

In what ways were the lenders "forced" to make no money down, NINJA (no income no job or assets) loans?

They were regulated into it by limiting the questions that could be asked on mortgage credit apps, and how much background checking they were allowed to do.

[Xavier_Onassis]

They were regulated into it by limiting the questions that could be asked on mortgage credit apps, and how much background checking they were allowed to do.

You mean they could not ask if the applicant had a job or source of income, and were barred from calling the employer to verify this?

I am sorry, but I do not believe this. They make have failed to ask the questions, but not because they were banned from doing so.

[Plane]

They were regulated into it by limiting the questions that could be asked on mortgage credit apps, and how much background checking they were allowed to do.

You mean they could not ask if the applicant had a job or source of income, and were barred from calling the employer to verify this?

I am sorry, but I do not believe this. They make have failed to ask the questions, but not because they were banned from doing so.

It was an attempt to prevent "greenlining".

There were banks that tried to avoid makeing loans in certain neighborhoods , and in effect ,  races that might predominate in such a neighborhood.

So there are things you don't ask anymore.


I don't think this was a major cause of this problem tho , ....