tlmorg02
DP Veteran
- Joined
- Nov 27, 2007
- Messages
- 3,347
- Reaction score
- 1,078
- Location
- Louisville, Ky
- Gender
- Male
- Political Leaning
- Slightly Liberal
It absoplutely was not. The investment bankers didnt drive housing markets higher and higher. The investment bankers didnt force people to get loans. That was the idiot that made 55k a year and decided if he rolled his truck, car, and television payments into his home loan and consolidated then he could afford a 600k home with a mortgage of 3k a month...provided they never went out to lunch, never had any car problems, convinced the kids to fast 1 day a week and only eat 1 meal a day. And of course once the variable interest rate kicked in they could refinance because the home value would have appreciated significantly...
Everyone plays a part...but its that 98% that you mention...they are the ones that drove the housing market into the toilet.
What caused this crisis, for the most part, was the packaging of the mortgages, that the banks knew would never fly, into derivatives and onto investors. Once those investors realized they were stuck and the money lost, they whole sale flocked from the market and the Middle Class lost their jobs, which perpetuated the increase in foreclosures, and their 401k's dropped out the bottom so they lost that as well.