Who Caused the Economic Crisis?
The economic collapse is on everyone's mind and a major factor in the presidential election, and there are a lot of mistakes and distortions flying around especially with regard to how Fannie Mae and Freddie Mac were involved in the problems. The planetmoneymp3 podcast covered a lot of this ground this week. Here's my summary.
- If the collapse is the fault of ( Read more... )
Blaming this on the Community Reinvestment Act (passed in the 1970's) is total nonsense. A major force has been a lack of accountability: the mortgage originator had no responsibility once it was sold. At that point risk "laundering" becomes possible. Another lack of accountability is IBGYBG: I'll Be Gone, You'll Be Gone. When it all blows up.
Ian Welsh on Firedoglake and a fine crew on The Agonist have been very helpful background.
Reply
Reply
They had crafted complex financial instruments that promised a fixed return, though few understood the underlying object that was guaranteed to investors in case of default. (Answer: nothing).
Can we start calling this the BushCrash(TM)? Please?
Reply
I think that would be not just unfair, but running counter to my whole point I tried to make in my main post here. This isn't Bush's crash and it's not Clinton's crash, it's not the Republicans' crash or the Democrats' crash or even the Fed and Treasury's crash. You don't get a fuckup this huge without everyone being a part of the nightmare.
I am the the variable-rate financed purchaser of a bubble-inflated 2002 house, so it's partly my fault. You might as well call it the Tongodeon Crash.
Reply
Reply
Leave a comment