Housing Bubble 2.0

[sirs]

The BANKS have the absolute power to refuse to grant a loan, period.

NOT when you have the power of the Federal Government telling banks you best loan to folks you may otherwise not loan to, otherwise you may "see" some repercussions in your immediate future,...audits, sanctions, any number of functions the Fed has at their disposal.  Sure the bank could say no, but with what the Fed could do, if they didn't play along, is what steered us into the meltdown that was the housing bubble collapse.  I realize that runs counter to your predisposed ideology Xo, but that's the reality, and it was BOTH Republicans & Democrats at fault. 

CONGRESS was behind the housing meltdown, with their policies and agenda that more people be "homeowners".  The banks went along, knowing that "well......DC says so, and they say they can back it up....one way or another".  MOST rationally minded economists and folks that actually DO know something about this, have come to that conclusion.....outside of the hard core coolaide drinking leftists that can't ever see Obama or the Government be wrong

[Xavier_Onassis]

No bank can be FORCED to give a loan to a person with no income or job. That is just stupid.

If you believe this, so are you.

The banks acted out of greed, they were not forced.

[Plane]

No bank can be FORCED to give a loan to a person with no income or job. That is just stupid.

If you believe this, so are you.

The banks acted out of greed, they were not forced.

It is like fertilising half of your garden.

Some banks did remain conservative in lending policys , you do not hear much about them because they remained small and some were snapped up by aquisition of larger banks.

Playing the game as the government set it up allowed bigger profits and faster growth, so the banks that would outgrew the banks that would not.

I think the banks that rolled a lot of loans were playing just as the Congress intended and the risk was being transferred to taxpayers , you don't think that the banks were behind transfering the risk to taxpayers do you?

[sirs]

BINGO.....at least some are working with a rational mind, minus the strawman of trying to make this only about people with no income and no job, since no one said that     

[Plane]

BINGO.....at least some are working with a rational mind, minus the strawman of trying to make this only about people with no income and no job, since no one said that     

Don't be down on XO, he is manfully working to hold up his end of an argument. I appreaciate this.

Strawmen are a tactic , and this is the real world .

Or something like it.

[sirs]

I'm never "down" on Xo, Plane.  It's just frequently easy to demonstrate where & when he's wrong on an issue.  Many time the reason he's so often wrong is his marriage to leftist ideology, for better or worse, Government in general, and Obama in particular can do no wrong. 

So, on this issue, if the mind is made up, despite all facts to the contrary, that Obama and the Government can't be wrong, then it has to be greedy bankers and Florida flippers.......it just has to be.  Can't back it up at all, but its just "obvious".  Minus the insults, I just enjoy highlighting when folks are wrong & using deflective strawman tactics, but yea, Xo's doing what he can to hold up the liberal dogma.  Others I can only guess found it just too hard in the face of so much reality that would refute their predisposed made up minds

[Xavier_Onassis]

The banks that sold the bogus loans probably knew that they were screwing the people that were buying the loans, some of whom were government agencies.

It was just like a burger joint selling groundhog, rat and squirrel instead of beef. They did not care. The bankers were the con men here. The rating agencies and the intermediaries were accomplices. Congress was wrong to have lifted the regulations. 

[sirs]

They're not screwing the Government, when it was the Government that was pushing the Banks to push the loans in the 1st place. 

[kimba1]

Xo is right but forgot to mention the banks action was not within the minimum the government require them to loan the money and the fact they exceeded it shifts blame to them as predatory.

This topic is funny to me because one time folks tried to put the blames squarely on the minorities only.

The question is how much more relax is the lending policy for2.0??

[sirs]

Sorry to say Kimba, but Xo is not right on this issue.  It started under Clinton, with the CRA.  Bush, and Republicans pushed it even more.  And when Democrats took control of the house, despite the red flags that were going up, Democrats were all too giddy to advocate more home ownership, via Fannie/Freddie's "support", despite the risk being placed on the taxpayers.  Banks were between a rock and a hard place, with what the Fed could do if they didn't play along.  And since they were still making money, why the hell not........until it all came crashing down.......thanks to DC policies of pushing banks to ok loans for folks that really were not financially stable or capable of taking on such a huge monetary burden. 

Without DC's intervention, there would have been no housing collapse, as the banking industry in general would not have been making such risky loans.  Sure, you would have had a few outliers, who were really into profit, but those would have been singled out, and not have caused a crash of the entire housing market

And I have no idea who you are referring to that would be "blaming minorities".  Lending institutions took advantage of them, but that doesn't put the blame on them.

[kimba1]

Whoa

I said the banks exceeded what the government required of them in lending . The subprime was what fuel the lending to encourage default to the premise the rising markets will lways make it profitable.

What you stated is true all advocated more home loans but none of them required this volume .

[sirs]

The volume was merely a natural result at the behest of Government pushing for more home ownership.  Much like what the rest of what Government is pushing, it simply became unsustainable

[Xavier_Onassis]

Selling bogus loans to anyone, even the government, is screwing the buyer. The banks are responsible for approving loans to unemployed people with no income.

If the government declared that rape was no longer illegal, then if someone was raped, you still could not call the government a rapist. Your logic is flawed, sirs.

[sirs]

Not when the Government pushed Banks to approve them, and "protected" them via the power of the taxpayers, i.e Fannie & Freddie

And no, this has squat to do with approving them to unemployed no-income folks, so you can drop with that strawman.  It has to do with approving them to folks whose income was no where near the level necessary to take on home mortgage payments, much less their downpayment

[Xavier_Onassis]

Banks are the final arbitrators of whom they lend money to.

They have always had the final say about this.