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To those who say Bush's deregulation caused the economi... - 3/4/2009 10:41:01 AM

Truthiness

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http://www.youtube.com/watch?v=cMnSp4qEXNM

Ironic it is, that the Repblicans as early as 2002 warned against this, and years ago tried to push regulation to prevent it.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 10:45:21 AM

kdsub

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Just wondering why it makes any difference who did what... neither side wanted this to happen... they were both sincere in their actions and both contributed to the result.

It is important where we go from here but constantly playing the blame game does no one any good.

Butch

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 10:48:47 AM

LaTigresse

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Oh come now..........Reganomics

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 10:56:37 AM

Truthiness

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quote:

ORIGINAL: kdsub

Just wondering why it makes any difference who did what... neither side wanted this to happen... they were both sincere in their actions and both contributed to the result.

It is important where we go from here but constantly playing the blame game does no one any good.

Butch

Oh agreed. Both sides have a lot to share in the blame; it just gets tiring seeing repeat posts here claiming that "Obama is cleaning up the economic mess Bush left!" and the like, when it's so obviously a fabrication.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 11:37:18 AM

kdsub

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quote:

ORIGINAL: Truthiness

quote:

ORIGINAL: kdsub

Just wondering why it makes any difference who did what... neither side wanted this to happen... they were both sincere in their actions and both contributed to the result.

It is important where we go from here but constantly playing the blame game does no one any good.

Butch

Oh agreed. Both sides have a lot to share in the blame; it just gets tiring seeing repeat posts here claiming that "Obama is cleaning up the economic mess Bush left!" and the like, when it's so obviously a fabrication.

I do understand but Bush did leave it... he was not alone in making it...but he did little to fix it.

Obama did inherit it and it is not fair to judge his pre-meltdown election promises in the face of the new challenge.

Lets hope with help from both sides of Congress we can solve this problem.

Butch

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 12:28:13 PM

Owner59

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To those who think deregulation didn`t cause the mess.

Freddy and fanny wasn`t the cause of the financial melt down.That`s the neo-con/Rush/bush/fox BS line for ducking responsibility.Freddy and Fanny were never mentioned at all.

"appears to be no need for gov regulation of off exchange derivatives transactions."

Then he admits he was wrong.Tho I blame him in part,I admire the man`s honesty.Something, we`ll never get from neo-cons.

Here`s the real analysts.

"The crisis turned out to be much broader than anything I could have imagined"

~~~~~~~~~~~~~~~

Freddy and Fanny were not the problem.The were regulated ,non-NINA highly scrutinized loans.

The bad loans that brought down the free market were all non-regulated,mostly NINA loans(no income verification-no asset verification) and were outside the purview of any oversight,ei un-regulated.

As was said after WWII,....never again.

After the we fix this,never again will we let our financial health be put in the hands of predator capitalists.

< Message edited by Owner59 -- 3/4/2009 12:30:55 PM >

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 4:13:46 PM

awmslave

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The fact is the government and banking industry are very tightly connected. If banks make good profits so do high government officials. Party affilation makes no difference. Not surprisingly Bill Clinton signs into law the Gramm-Leach-Bliley Financial Services Modernization Act, November 12, 1999 (was conducive to the the repeal of the Glass-Steagall Act of 1933) and Commodity Futures Modernization Act (CFMA)(2000). These two were fundamental legislations allowing abuses that followed. How can people like Schumer, Dodd, Frank and others confront banking industry if at the same time they get top contributions from banks. After the party is over everybody is smart and pointing fingers. In China these people would be in prison waiting execution.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 4:19:25 PM

awmslave

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quote:

Just wondering why it makes any difference who did what... neither side wanted this to happen... they were both sincere in their actions and both contributed to the result.

It is important where we go from here but constantly playing the blame game does no one any good.

Butch

I totally disagree. Bush government knew long in advance what was going to happen. So did Clinton before the crisis 2000. Government accounting may be defective but not so bad that they do not have any sense how economy is moving.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 4:27:14 PM

TNstepsout

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You can say all you want, but it WAS deregulation that caused the mess. If you want to see how the pieces fit together watch House of Cards on CNBC. The banks were deregulated in terms of how many times they could loan the same dollar. Leverage used to be 16 X, but under the Bush admin. that restriction was lifted and many institutions loaned the same dollar upwards of 30X. Which means when a loan defaulted, the fallout was 30X greater than a single loan defaulting. There was also NO regulation of mortgage backed securities and no rules and no one watching. There were warnings, but no one heeded them.

I do blame this mess 100% on the Feds who should have been minding the Asylum instead of letting the inmates do it.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 4:45:14 PM

Raiikun

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One could argue that it was regulation that caused that. People can't loan more than they have, unless there's some form of rule made that allows them to. Without the government stepping in and allowing it, banks wouldn't be able to loan 30x.

Keep in mind, regulation isn't the same as restriction.

Take away the regulations allowing banks to loan more than they should IMO.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 5:07:27 PM

TheUtopian

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quote:

ORIGINAL: awmslave

The fact is the government and banking industry are very tightly connected. If banks make good profits so do high government officials. Party affilation makes no difference. Not surprisingly Bill Clinton signs into law the Gramm-Leach-Bliley Financial Services Modernization Act, November 12, 1999 (was conducive to the the repeal of the Glass-Steagall Act of 1933) and Commodity Futures Modernization Act (CFMA)(2000). These two were fundamental legislations allowing abuses that followed. How can people like Schumer, Dodd, Frank and others confront banking industry if at the same time they get top contributions from banks. After the party is over everybody is smart and pointing fingers. In China these people would be in prison waiting execution.

Thank you......

What is it.....maybe three or four posters per every 90/100 actually understand what's going on. They need to invent some kind of new gadget where I can physically reach through my 'puter screen.....and pull all the dummies through and club em' so they're put out of their misery.

- R

PS - It's a good bet that this piece of shit combination Phil /Wendy Graham will be part of the ''new'' Republican ''savior'' for ''change'' when 2012 rolls around.....And I guarantee you that if these message boards are still around, Phil Graham will have all the usual suspect cheerleaders here.

The Repubs...!!!

No the Dems!!!

The Repubs!!

The Dems!!!

< Message edited by TheUtopian -- 3/4/2009 5:28:06 PM >

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 5:30:00 PM

TNstepsout

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quote:

ORIGINAL: Raiikun

One could argue that it was regulation that caused that. People can't loan more than they have, unless there's some form of rule made that allows them to. Without the government stepping in and allowing it, banks wouldn't be able to loan 30x.

Keep in mind, regulation isn't the same as restriction.

Take away the regulations allowing banks to loan more than they should IMO.

Banks are permitted to loan more money than they have but previously there were regulations in place that limited that amount to a safer level. Combine the lifting of the leverage regulation with the loosening of lending standards and you had a recipe for disaster. Lending was no longer an investment, it was flat out gambling.

I would have thought people would know better by now. I remember the exact same thing happening in the 80's with the commercial real estate and savings and loan crisis. No more than a decade after lifting the regulations on savings and loans, most of them were out of business, absorbed by the RTC. They had loaned themselves into bankruptcy.

A lot of people do not like the idea of regulation and think that it hampers the ability for a free market to thrive. The problem is, especially when it comes to banking and finance, the government MUST regulate, because if they don't, they will be picking up the pieces. Which is exactly what is happening.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 5:53:04 PM

slaveboy291

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quote:

ORIGINAL: Truthiness

quote:

ORIGINAL: kdsub

Just wondering why it makes any difference who did what... neither side wanted this to happen... they were both sincere in their actions and both contributed to the result.

It is important where we go from here but constantly playing the blame game does no one any good.

Butch

Oh agreed. Both sides have a lot to share in the blame; it just gets tiring seeing repeat posts here claiming that "Obama is cleaning up the economic mess Bush left!" and the like, when it's so obviously a fabrication.

Aaaawe what's the matter? Truth hurt too much?

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 6:34:52 PM

MmeGigs

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quote:

ORIGINAL: awmslave
I totally disagree. Bush government knew long in advance what was going to happen. So did Clinton before the crisis 2000. Government accounting may be defective but not so bad that they do not have any sense how economy is moving.

I think that we started down this path before Clinton, Bush the First, or Reagan, but I think that Reagan kicked it into gear.
The problem was that the market, govt and business built their projections on the assumption that the bubbles wouldn't burst. Housing prices would continue to rise, as would profits from other sectors. That was an okay way to think about the short term, but any boob knows that a sound investment strategy also has to look at the long term. That high returns are unsustainable in the long term is Econ 101. The folks who bought into the questionable financial strategies that have brought us to our current situation weren't just any boobs, they were super-boobs. It was a total "Emporer's New Clothes" thing. Folks were afraid to admit that they didn't understand how these complex securities like sub-prime mortgage packages and credit default swaps worked. They bought them because they were told that everyone else was buying them and cleaning up. They didn't want to be left out. It's no different than the reason I buy into the lottery ticket pool at work. I don't want to be the only one left here if they hit the right number. The only real difference is that I understand that I'm most likely throwing my money away.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 7:00:14 PM

Hippiekinkster

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quote:

ORIGINAL: MmeGigs

quote:

ORIGINAL: awmslave
I totally disagree. Bush government knew long in advance what was going to happen. So did Clinton before the crisis 2000. Government accounting may be defective but not so bad that they do not have any sense how economy is moving.

I think that we started down this path before Clinton, Bush the First, or Reagan, but I think that Reagan kicked it into gear.
The problem was that the market, govt and business built their projections on the assumption that the bubbles wouldn't burst. Housing prices would continue to rise, as would profits from other sectors. That was an okay way to think about the short term, but any boob knows that a sound investment strategy also has to look at the long term. That high returns are unsustainable in the long term is Econ 101. The folks who bought into the questionable financial strategies that have brought us to our current situation weren't just any boobs, they were super-boobs. It was a total "Emporer's New Clothes" thing. Folks were afraid to admit that they didn't understand how these complex securities like sub-prime mortgage packages and credit default swaps worked. They bought them because they were told that everyone else was buying them and cleaning up. They didn't want to be left out. It's no different than the reason I buy into the lottery ticket pool at work. I don't want to be the only one left here if they hit the right number. The only real difference is that I understand that I'm most likely throwing my money away.

Bingo! That is exactly right! In fact, this Wired article describes the mechanism by which an equation correlating multiple variables was misused to judge risk because the equation itself was based on only rising prices.
http://www.wired.com/techbiz/it/magazine/17-03/wp_quant?currentPage=3
It's difficult reading (sort of), but it explains how all those CDOs and credit default swaps became legitimized.
It's really scary to find out how incredibly ignorant those who use such "analytical tools" really are of the theoretical basis of such tools, and their limitations. The Li equation is, I'm thinking, the 2000s equivalent of the Black-Scholes Bond Valuation model - the latest "simple" answer to complex mathematical problems. (Not saying Black-Scholes doesn't work, mind you)

< Message edited by Hippiekinkster -- 3/4/2009 7:01:38 PM >

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 7:34:01 PM

TheUtopian

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quote:

That was an okay way to think about the short term, but any boob knows that a sound investment strategy also has to look at the long term.

And any boob also knows that you don't put all your eggs into one basket either ; diversification being the key here.

A prudent investor would/should spread things around : A little in the market, a little in art and antiquities , a bit in real-estate, and maybe some in treasuries/muni-bonds....

While folks were not paying attention, both parties divested us out of our manufacturing base---which made us prosperous in the first place---and supplanted that stimulus/growth that we would have had normally, with that of a false-stimulus from infinite-minded, false asset-appreciation, ala the housing/lending bubble.

So in essence, in terms of the *real/physical* economy, it was not all the improprieties as far as lending practices go that caused us to burn - But instead like the prudent investor who would/should spread his/her investments around, ala diversification ---- our main/only focus was to manufacture wealth in a erroneous manner by falsely inflating our assets.

- R

< Message edited by TheUtopian -- 3/4/2009 7:49:29 PM >

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 8:12:14 PM

TNstepsout

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quote:

ORIGINAL: MmeGigs

quote:

ORIGINAL: awmslave
I totally disagree. Bush government knew long in advance what was going to happen. So did Clinton before the crisis 2000. Government accounting may be defective but not so bad that they do not have any sense how economy is moving.

I think that we started down this path before Clinton, Bush the First, or Reagan, but I think that Reagan kicked it into gear.

I think you're right. I think we had recessions in the past and instead of gently promting the economy they did things to really infuse it and it seemed to jump. The economy over the last 25 years has grown disproportionately and now we are seeing the end result. Had things been encouraged at a slower, more natural pace, we might be at the same place we are now, but it would be far less painful. Slow steady growth is much healthier and stable than boom and bust economics.

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RE: To those who say Bush's deregulation caused the eco... - 3/4/2009 10:34:30 PM

Honsoku

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quote:

ORIGINAL: TNstepsout

quote:

ORIGINAL: MmeGigs

quote:

ORIGINAL: awmslave
I totally disagree. Bush government knew long in advance what was going to happen. So did Clinton before the crisis 2000. Government accounting may be defective but not so bad that they do not have any sense how economy is moving.

I think that we started down this path before Clinton, Bush the First, or Reagan, but I think that Reagan kicked it into gear.

I think you're right. I think we had recessions in the past and instead of gently promting the economy they did things to really infuse it and it seemed to jump. The economy over the last 25 years has grown disproportionately and now we are seeing the end result. Had things been encouraged at a slower, more natural pace, we might be at the same place we are now, but it would be far less painful. Slow steady growth is much healthier and stable than boom and bust economics.

When things are going well, everyone hates and tries to ignore the person that suggests caution and restraint and instead they push for more. When things go to pieces they all hate the person that should have warned them and made them slow down. The big problem is that the person that can warn them and make them slow down or allow them more, has that power at the whim of the people that would be affected.

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RE: To those who say Bush's deregulation caused the eco... - 3/5/2009 5:08:31 AM

TNstepsout

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quote:

ORIGINAL: Honsoku

When things are going well, everyone hates and tries to ignore the person that suggests caution and restraint and instead they push for more. When things go to pieces they all hate the person that should have warned them and made them slow down. The big problem is that the person that can warn them and make them slow down or allow them more, has that power at the whim of the people that would be affected.

Yup-you got it. Which is why, in the long run, I honestly don't think "democracy" will work. I know it's blasphemous to say so, but that's what I think. People are too short sighted and only think about what is in front of them right now. If they vote with that kind of shortsightedness, then shortsighted policies are what we will get.

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RE: To those who say Bush's deregulation caused the eco... - 3/5/2009 8:14:42 AM

DedicatedDom40

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quote:

ORIGINAL: awmslave

The fact is the government and banking industry are very tightly connected. If banks make good profits so do high government officials. Party affilation makes no difference. Not surprisingly Bill Clinton signs into law the Gramm-Leach-Bliley Financial Services Modernization Act, November 12, 1999 (was conducive to the the repeal of the Glass-Steagall Act of 1933) and Commodity Futures Modernization Act (CFMA)(2000). These two were fundamental legislations allowing abuses that followed. How can people like Schumer, Dodd, Frank and others confront banking industry if at the same time they get top contributions from banks. After the party is over everybody is smart and pointing fingers. In China these people would be in prison waiting execution.

Absoultely right.

Barney Frank and Franklin Raines and all the other GSE problem deniers created $1 trillion in toxic assets, then legislation authored by Phil Gramm, passed by a Republican congress, and signed by Bill Clinton deregulated the trading of derivatives on Wall St thus turning that one trillion of toxicity into a $500 trillion global problem that truly threatens our financial existance.

Others of various political affiliations were responsible for the SEC falling down, and allowing these banks to merge througout the two decades previous, creating their 'too big to fail' reality.

The GSE's are 10% of the problem, but their effect is 100% known to the majority of Americans. The derivatives thing is 90% of our problem, and we have only seen 20% of that play out.

Hopefully the stimulus will help keep the next wave of foreclosures from igniting the remainder of that 90% that has yet to play out. If successful, then the next step will be to drain down the derivatives risk. If its not successful, then nobody will have to worry as we'll be financially done. All the politicians who make so much noise about the stimulus being "a $1 trillion crime against future generations" simply fails to admit the "real crime" is letting that $500 trillion derivatives bomb go off, as that would truly wipe us all out, immediately and all at once, rather than the '$1 trillion at a time' method that the stimulus detractors seem to be so worried about. Those politicians are merely hiding their own past political mistakes behind the issue of 'irresponsible spending', and are trying to distract the public from becoming aware of the real problem facing us.

I dont know about you, but my heart skipped a couple dozen beats when John McCain admitted to know nothing about the economy, and then pointed to the same Phil Gramm as his economic answer man. That would be akin to Obama picking Franklin Raines for the Treasury post.

< Message edited by DedicatedDom40 -- 3/5/2009 9:11:42 AM >

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