The Boy Who Cried Wolf, A Story the Progressive-Left Fails to Heed.

[code1211]

That's funny. We're supposed to believe that a law passed by a GOP Senate and House was Clinton's fault, and that once Bush took over the same GOP House and Senate were incapable of changing the law they passed and Bush's regulators were incapable of enforcing existing lending standards. We're also supposed to forget that Bush didn't file suit to prevent states from enforcing their own lending standards.

I'm with you in assigning part of the blame to Clinton! But you're just showing your partisan colors by absolving the guy in charge while the bubble was blowing up and then crashing from any role in the mess he watched happen. BTW, here's my favorite photo of the era - it's Bush era regulators effectively promising....not to regulate. And they didn't!

View attachment 67236202

The guy on the left with the chain saw is the OTS chief who regulated AIG, the insurer that cost about $200 billion to bail out. To be fair, it wasn't really a bailout of AIG, but important customers like GS and CITI, and we funneled the bailout money through AIG, but the point remains. One of the largest insurers in the world was regulated by a "thrift" regulator. Wasn't an accident. OTS promised not to regulate so AIG chose them as regulator.

Article here: https://www.propublica.org/article/banks-favorite-toothless-regulator-1125

I'm sorry. The common charge is that Bush caused the Great Recession. I was not trying to absolve him of any blame. I was only saying that the blame need be spread to all who were involved including Bush.

That group includes anyone who profited from the stock market, held or issued a loan, had a bank account, sold or bought a home or used any banking product of any kind in the last 40 or so years and anyone in government who could see it coming and did nothing to stop it.

Eliminating the Federal Thrift Charter was also instrumental along with a litany of other laws passed to relax the regulation of the financial industry.

http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/4xx/doc433/thrift.pdf

 

[JasperL]

I'm sorry. The common charge is that Bush caused the Great Recession. I was not trying to absolve him of any blame. I was only saying that the blame need be spread to all who were involved including Bush.

OK, but you said - "Are you yet another of the under informed folks that believe that W did something that augmented the drive toward the Financial meltdown." I'm one of those who believe he did lots of things that contributed to the creation and size of the bubble - or more accurately didn't so lots of things.

And I agree, and there are all kinds of people to blame, and the biggest ones are the guys who fly around in private jets and get 7 or 8 figure bonuses, and whose companies spent $billions (with a B) lobbying Congress, and the White House, and it includes the many Democrats and Republicans who did their bidding in return for all that money and influence.

That group includes anyone who profited from the stock market, held or issued a loan, had a bank account, sold or bought a home or used any banking product of any kind in the last 40 or so years and anyone in government who could see it coming and did nothing to stop it.

I don't know why you are blaming the little people, when it's the guys who got rich giving out those loans who are the culprits. Go to NYC (and London, etc) and look up as far as your eye can take you to the penthouse offices on the corners of the major banking centers - that's where the blame goes.

Eliminating the Federal Thrift Charter was also instrumental along with a litany of other laws passed to relax the regulation of the financial industry.

http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/4xx/doc433/thrift.pdf

That's true - I'm not sure about eliminating the Federal Thrift Charter - I'm not aware that happened pre-crisis (could be wrong). The "let the banks regulate themselves" crowd won the day and the banks caused a WORLD WIDE credit bubble and crash and then recession/depression.

But the problem a lot of people have is the GOP gets elected, like they did with Trump, promising not to regulate, and then proceed to not regulate, which Bush was proud to not do with the banks and lenders in that era. When that deliberate decision to not-regulate results in a financial crisis and crash, it seems a bit of revisionist history for conservatives who hate regulations and favored all the repeals of bank regulations to blame the crisis on the not-regulation the GOP promises and delivers not to do and which before the crash those conservatives supported (the not-regulation), and it's especially a bit hard to take when people on the right blame democrats for the lack of regulation, when in nearly all other cases Democrats are blamed for....regulating.

 

[NonoBadDog]

It depends.

BTW, remember Iraq? It was a long, long time ago but we took far more drastic actions to effect regime change there and in Afghanistan than funding a group that later went on to oppose Bibi. Also, too, Vietnam, and Iran and who knows how many countries in Central and S. America. Not sure why you brought up the most trivial example of the U.S. interfering in who is in charge of a given government.

Furthermore, if you want to talk about U.S. efforts to oust Bibi, you've been on DP long enough to know how to start a thread. I bet there are several on topic already, which you can bring back from the dead if you want. It's a red herring in relation to this case, unless you're OK with Russians and Chinese and the Saudis and North Korea and any other country with money and intelligence services using their spies to try to elect people in this country sympathetic to their causes. If you don't care about such things, say so, and we can agree to disagree. Otherwise, it's a transparent attempt to divert from the Russia case, and is doing Russia's bidding, or is trolling.



You'll need some evidence for that. All I've read about is the lawyers representing Concord showed up. And if you want to quote WHY Mueller argues that, that's fine, because Russia refused to serve the defendants in the case.

https://www.politico.com/story/2018/05/04/mueller-russia-interference-election-case-delay-570627



As to this:



You left out the part I quoted above. And note the part about "through counsel." The co-defendants (the owners and any employees - aka the individuals, humans, who might have to go to jail) refused service and Russia refused to serve them. The lawyers were the only human beings related to Concord who showed up in court.

I can't force you to recognize facts. That denial thing that you insist on doing doesn't work real good.

 

[JasperL]

I can't force you to recognize facts. That denial thing that you insist on doing doesn't work real good.

I notice you were vague on what facts I got wrong... I quoted my sources, so I'm not sure what you're talking about.

 

[American]

That is exactly what independents and liberals have been calling for, letting the investigation run its course. Republicans have been actively obstructing, denying, distracting and lying to try to get the entire investigation shut down from day 1. Hell, on Monday it's expected for House Republicans to impeach Rosenstein. They do not want to discover the truth because they realize what it means for their political position.

It is now AN INDISPUTABLE FACT that Russian intelligence agents actively hacked our political parties and intentionally steered our election outcome with targeted leaks and propaganda, yet Trump and the majority of his supporters refuse to even accept this FACT. The investigation will continue no matter how hard Republicans scream at the top of their lungs that it should stop. Crying wolf would be saying something is happening then finding out it isn't. This situation is the exact opposite as it's Republicans saying something didn't happen when it turns out it did.

What a total load of BULL****!!!!!!! Liberals have been fuming for over a year that Trump COLLUDED WITH THE RUSSIANS TO GET ELECTED. The Russian hacking became irrelevant a long time ago. The Democrats didn't even want their server looked at. No evidence of Trump collusion has yet surfaced, and probably won't. Russians hacking the DNC was accepted as fact a long time ago, but has zero to do with trying to nail Trump.

 

[Casper]

What a total load of BULL****!!!!!!! Liberals have been fuming for over a year that Trump COLLUDED WITH THE RUSSIANS TO GET ELECTED. The Russian hacking became irrelevant a long time ago. The Democrats didn't even want their server looked at. No evidence of Trump collusion has yet surfaced, and probably won't. Russians hacking the DNC was accepted as fact a long time ago, but has zero to do with trying to nail Trump.

Then you have no problem letting the investigation run it's course, good to know.

 

[WillyPete]

I agree that much of the hue and cry in reaction to Trump's election has been counter-productive, but it is not significantly different from the dogged opposition to anything and everything Obama or Hillary ever did.

If you only see the problem coming from one side of the political spectrum, you're part of it.

 

[American]

Then you have no problem letting the investigation run it's course, good to know.

It is running it's course, and no one has raised a hand to stop it. Any other strawmen you'd like to create?

 

[Casper]

It is running it's course, and no one has raised a hand to stop it. Any other strawmen you'd like to create?

Let's keep it that way.

 

[Casper]

It is running it's course, and no one has raised a hand to stop it. Any other strawmen you'd like to create?

Let's keep it that way.

 

[lurchadams]

It is running it's course, and no one has raised a hand to stop it. Any other strawmen you'd like to create?

What an idiotic statement.

Sent from my SM-G900V using Tapatalk

 

[code1211]

OK, but you said - "Are you yet another of the under informed folks that believe that W did something that augmented the drive toward the Financial meltdown." I'm one of those who believe he did lots of things that contributed to the creation and size of the bubble - or more accurately didn't so lots of things.

And I agree, and there are all kinds of people to blame, and the biggest ones are the guys who fly around in private jets and get 7 or 8 figure bonuses, and whose companies spent $billions (with a B) lobbying Congress, and the White House, and it includes the many Democrats and Republicans who did their bidding in return for all that money and influence.



I don't know why you are blaming the little people, when it's the guys who got rich giving out those loans who are the culprits. Go to NYC (and London, etc) and look up as far as your eye can take you to the penthouse offices on the corners of the major banking centers - that's where the blame goes.



That's true - I'm not sure about eliminating the Federal Thrift Charter - I'm not aware that happened pre-crisis (could be wrong). The "let the banks regulate themselves" crowd won the day and the banks caused a WORLD WIDE credit bubble and crash and then recession/depression.

But the problem a lot of people have is the GOP gets elected, like they did with Trump, promising not to regulate, and then proceed to not regulate, which Bush was proud to not do with the banks and lenders in that era. When that deliberate decision to not-regulate results in a financial crisis and crash, it seems a bit of revisionist history for conservatives who hate regulations and favored all the repeals of bank regulations to blame the crisis on the not-regulation the GOP promises and delivers not to do and which before the crash those conservatives supported (the not-regulation), and it's especially a bit hard to take when people on the right blame democrats for the lack of regulation, when in nearly all other cases Democrats are blamed for....regulating.

There's regulation and then there's regulation.

Regulation of the financial industry is a good thing to a point. It protects the little guys from the big bullies. However, it can be either a guide wire or a noose for the whole economy depending on how the regulations are written and enforced.

The banking crisis was based on a variety of problems that stemmed from the bundling of home loans that were assumed to have been accurately valued EVEN THOUGH EVERYONE IN THE BUSINESS KNEW THEY WERE NOT ACCURATELY VALUED.

The bundles were like cars without engines being sold as if they were cherry.

When the audits occurred and the value of the bundles were pegged correctly, the house of cards fell. Those bundles were not assembled by the guys in the Ivory Towers. They were assembled by the worker ants.

The folks who were told that the house they bought in 1995 had doubled in value and so took out that second mortgage did not have a gun to their head and the guy in the ivory Tower did not make them do it.

The folks, like me, who had a 401K that went berserk in that period did nothing but let 'er ride and reaped pretty good benefits.

Nobody was completely disconnected from the benefits on the way up and those that overextended during the run up really got swatted on the way down.

Everyone got swatted to some extent on the way down. It happened. It's happened before. It'll happen again.

 

[jnug]

There's regulation and then there's regulation.

Regulation of the financial industry is a good thing to a point. It protects the little guys from the big bullies. However, it can be either a guide wire or a noose for the whole economy depending on how the regulations are written and enforced.

The banking crisis was based on a variety of problems that stemmed from the bundling of home loans that were assumed to have been accurately valued EVEN THOUGH EVERYONE IN THE BUSINESS KNEW THEY WERE NOT ACCURATELY VALUED.

The bundles were like cars without engines being sold as if they were cherry.

When the audits occurred and the value of the bundles were pegged correctly, the house of cards fell. Those bundles were not assembled by the guys in the Ivory Towers. They were assembled by the worker ants.

The folks who were told that the house they bought in 1995 had doubled in value and so took out that second mortgage did not have a gun to their head and the guy in the ivory Tower did not make them do it.

The folks, like me, who had a 401K that went berserk in that period did nothing but let 'er ride and reaped pretty good benefits.

Nobody was completely disconnected from the benefits on the way up and those that overextended during the run up really got swatted on the way down.

Everyone got swatted to some extent on the way down. It happened. It's happened before. It'll happen again.

That is simply not an accurate analysis of what happened. The best way to make money in finance is to limit risk. The derivatives market allowed mortgage lenders that knew full well that they had created very risky mortgage instruments as products to lay all that highly circumspect risk off on the Underwriters. They used the derivatives market to do it because the combination of mortgages and derivatives allowed them to circumvent what flimsy regulations there were governing leverage in the mortgage lending market, the easy means with which they were allowed to create these very risky mortgage instruments and the virtually non-existant regulatory environment governing derivatives packages. The Underwriters were attracted to absorb the excessive risk because as long as this house of cards did not crumble, they would make their enormous profits. Risk/reward.....if you are willing to absorb excessive risk you can make excessive profits. However as I pointed out at the start of this post the actual best way in Finance to make money "STEADILY" and with some sense for fiscal responsibility is to limit risk. For example, though it is only possible in theory, if a financial institution could limit its risk to 0 it would be like printing money!

The mess that ensued had absolutely nothing to do with the value of the properties themselves and had everything to do with the widespread marketing of risky mortgage instruments to borrowers that did not have any earthly idea what they were getting into coupled with a scheme to create exactly the environment that allows financial institutions to make the most money for themselves by absorbing the least risk. They laid all that circumspect risk off on the Underwriters who accepted it frothing at the mouth because the Underwriters would make a fortune IF nothing went wrong. Again there was no regulatory system that would prevent the Underwriters from sating their frothing. THAT tactical approach to mortgage lending was not created by worker bees!

The bubble broke when it became apparent too late that the inherent risk of these whacky mortgage instruments were creating a circumstance where foreclosure rates were heading for the stratosphere regardless of the value of the individual houses themselves. It did not help that the home construction industry responded to what they wanted to believe was a new customer base for their products by building more new homes. But neither their new homes or the value of existing homes was the problem. The problem was the tactic which again was no concoction of financial institution worker bees or any other kind of worker bee.

 

[Moderate Right]

Anyone remember the story of the Boy Who Cried Wolf?

I found the shortest video version for your edification:

(Warning: Foul language.)



I bring this up because that's how I see many on the Progressive-Left and in the MSM acting ever since President Trump was elected.

Story after story about how some action by the Mueller investigation, or revelation by some anonymous information source, or even some side-show (like Stormy Daniels) is going to be "the wolf" that eats Trump, proving once and for all Trump stole the election through some dastardly trick.

That he'll finally be impeached, and the world will be all roses and sunshine again.

Yet each time the "Wolf! Wolf!" turns out to be nothing; a false alarm which raised hopes then had to be quickly dropped. Subsequently a new "revelation" occurs, and "Wolf! Wolf!" is cried loudly and clearly again only to end up with no wolf after all.

Most recently it is the indictment of 12 Russian GRU agents, one of whom pretended to be a Romanian hacker using the name Guccifer 2.0.

Apparently, per our wolf-crying peers, Roger Stone is now the new "certain connection" to Russian collusion which will finally tie all the loose strings together to oust Trump so that truth, justice, and the American Way will prevail. :roll:

Yet it all remains (as usual) blatant speculation and conspiracy theory touted as "Truth!" :yes:

Has anyone thought that it might be better to simply let the investigation run it's course?

That IF any actual tie to the President or his Administration FACTUALLY comes to light, and indictments are presented stating so, THEN would be the time to shout that a "Wolf!" has entered the fold?

Until then, all this "crying wolf" sounds like desperately bored and frustrated shepherd boys trying to keep relevant when they know there is no actual wolf.

Just like in The Boy Who Cried Wolf, if something ever does show up, the townspeople will just ignore it because they have no reason to believe you anymore.

Many people, including myself, are already there. Hence our silence when a new Anti-Administration thread is posted in the Forum which becomes an echo-chamber for the wolf-criers. :coffeepap:

In a way that is what the election was all about. Trump is a wolf so don't vote for him. Voters didn't believe the wolf stories then and since Trump won it has been wolf, wolf, wolf. The left are the only ones who believe their wolf stories. A recent poll even showed that not only are Independents getting tired of Mueller's investigation coming up empty regarding Russian collusion but more and more Democrats are finding it nonsense as well. About the best they seem able to do is indict Russian intelligence officers who reside in Russia for being spies. Duh. Meanwhile, no Russian collusion.

Breaking News: Mueller has just indicted Putin for putting the interests of Russia over the interests of the US.

 

[Moderate Right]

Anyone remember the story of the Boy Who Cried Wolf?

I found the shortest video version for your edification:

(Warning: Foul language.)



I bring this up because that's how I see many on the Progressive-Left and in the MSM acting ever since President Trump was elected.

Story after story about how some action by the Mueller investigation, or revelation by some anonymous information source, or even some side-show (like Stormy Daniels) is going to be "the wolf" that eats Trump, proving once and for all Trump stole the election through some dastardly trick.

That he'll finally be impeached, and the world will be all roses and sunshine again.

Yet each time the "Wolf! Wolf!" turns out to be nothing; a false alarm which raised hopes then had to be quickly dropped. Subsequently a new "revelation" occurs, and "Wolf! Wolf!" is cried loudly and clearly again only to end up with no wolf after all.

Most recently it is the indictment of 12 Russian GRU agents, one of whom pretended to be a Romanian hacker using the name Guccifer 2.0.

Apparently, per our wolf-crying peers, Roger Stone is now the new "certain connection" to Russian collusion which will finally tie all the loose strings together to oust Trump so that truth, justice, and the American Way will prevail. :roll:

Yet it all remains (as usual) blatant speculation and conspiracy theory touted as "Truth!" :yes:

Has anyone thought that it might be better to simply let the investigation run it's course?

That IF any actual tie to the President or his Administration FACTUALLY comes to light, and indictments are presented stating so, THEN would be the time to shout that a "Wolf!" has entered the fold?

Until then, all this "crying wolf" sounds like desperately bored and frustrated shepherd boys trying to keep relevant when they know there is no actual wolf.

Just like in The Boy Who Cried Wolf, if something ever does show up, the townspeople will just ignore it because they have no reason to believe you anymore.

Many people, including myself, are already there. Hence our silence when a new Anti-Administration thread is posted in the Forum which becomes an echo-chamber for the wolf-criers. :coffeepap:

In a way that is what the election was all about. Trump is a wolf so don't vote for him. Voters didn't believe the wolf stories then and since Trump won it has been wolf, wolf, wolf. The left are the only ones who believe their wolf stories. A recent poll even showed that not only are Independents getting tired of Mueller's investigation coming up empty regarding Russian collusion but more and more Democrats are finding it nonsense as well. About the best they seem able to do is indict Russian intelligence officers who reside in Russia for being spies. Duh. Meanwhile, no Russian collusion with Trump or his campaign to influence the election.

Breaking News: Mueller has just indicted Putin for putting the interests of Russia over the interests of the US.

 

[code1211]

That is simply not an accurate analysis of what happened. The best way to make money in finance is to limit risk. The derivatives market allowed mortgage lenders that knew full well that they had created very risky mortgage instruments as products to lay all that highly circumspect risk off on the Underwriters. They used the derivatives market to do it because the combination of mortgages and derivatives allowed them to circumvent what flimsy regulations there were governing leverage in the mortgage lending market, the easy means with which they were allowed to create these very risky mortgage instruments and the virtually non-existant regulatory environment governing derivatives packages. The Underwriters were attracted to absorb the excessive risk because as long as this house of cards did not crumble, they would make their enormous profits. Risk/reward.....if you are willing to absorb excessive risk you can make excessive profits. However as I pointed out at the start of this post the actual best way in Finance to make money "STEADILY" and with some sense for fiscal responsibility is to limit risk. For example, though it is only possible in theory, if a financial institution could limit its risk to 0 it would be like printing money!

The mess that ensued had absolutely nothing to do with the value of the properties themselves and had everything to do with the widespread marketing of risky mortgage instruments to borrowers that did not have any earthly idea what they were getting into coupled with a scheme to create exactly the environment that allows financial institutions to make the most money for themselves by absorbing the least risk. They laid all that circumspect risk off on the Underwriters who accepted it frothing at the mouth because the Underwriters would make a fortune IF nothing went wrong. Again there was no regulatory system that would prevent the Underwriters from sating their frothing. THAT tactical approach to mortgage lending was not created by worker bees!

The bubble broke when it became apparent too late that the inherent risk of these whacky mortgage instruments were creating a circumstance where foreclosure rates were heading for the stratosphere regardless of the value of the individual houses themselves. It did not help that the home construction industry responded to what they wanted to believe was a new customer base for their products by building more new homes. But neither their new homes or the value of existing homes was the problem. The problem was the tactic which again was no concoction of financial institution worker bees or any other kind of worker bee.

I knew a guy who was a "Loan Originator". He wrote the loans and then sold them to banks. Due to his relationship with the banks, he had no real risk.

The banks would in turn hold the loan and administer it for a while and then sell it to other financial institutions. The sales of the various mortgages would be made more streamlined as the individual mortgages were "bundled" into huge lumps of assets. By pursuing this practice, the banks held no risk.

The problem was that various of the mortgages in the bundles were no longer good. The borrower had walked away. The debt load was too great and the borrower could not service the loan.

How did this happen? How did people get loans that they could not afford to make payments on? This is where the relaxed regulations come in to play. Everyone was overextending. Some leveraged it alright. Others did not.

In some cases, the banks were forced to lend to those who they otherwise would not lend to. These were the sub prime borrowers. This rose in some cases from the Bank's practice of "Red Lining" that was ruled to be discriminatory.

In other cases, people were just wanted more than they could rationally afford.

In all cases, individual choices created potentially bad outcomes.

Within the bundles were loans that were valueless. When the value of the bundles were shown to be far short of the stated values, the worth of the financial institutions evaporated.

This is no different than the movies where the gambler can't pay his debt to the crime boss. The difference is that the situation was spread throughout the economy and throughout the financial system. Banks that "saw it coming" had already sold off the suspect bundles and did so, probably, with malice or were at least knowingly deceitful. Whatever the motivation, though, the result was that the financial institutions started to fall like dominoes and that was when the Feds stepped in with their "Too Big to Fail" ideas.

In truth, these institutions were too stupid to succeed.

They were, in effect, buying thousands of houses at a time, sight unseen, exercising no fiduciary responsibility to their investors and acting like loan sharks. Those left holding the hot potato were the patsies, but they were all culpable.

 

[jnug]

I knew a guy who was a "Loan Originator". He wrote the loans and then sold them to banks. Due to his relationship with the banks, he had no real risk.

The banks would in turn hold the loan and administer it for a while and then sell it to other financial institutions. The sales of the various mortgages would be made more streamlined as the individual mortgages were "bundled" into huge lumps of assets. By pursuing this practice, the banks held no risk.

The problem was that various of the mortgages in the bundles were no longer good. The borrower had walked away. The debt load was too great and the borrower could not service the loan.

How did this happen? How did people get loans that they could not afford to make payments on? This is where the relaxed regulations come in to play. Everyone was overextending. Some leveraged it alright. Others did not.

In some cases, the banks were forced to lend to those who they otherwise would not lend to. These were the sub prime borrowers. This rose in some cases from the Bank's practice of "Red Lining" that was ruled to be discriminatory.

In other cases, people were just wanted more than they could rationally afford.

In all cases, individual choices created potentially bad outcomes.

Within the bundles were loans that were valueless. When the value of the bundles were shown to be far short of the stated values, the worth of the financial institutions evaporated.

This is no different than the movies where the gambler can't pay his debt to the crime boss. The difference is that the situation was spread throughout the economy and throughout the financial system. Banks that "saw it coming" had already sold off the suspect bundles and did so, probably, with malice or were at least knowingly deceitful. Whatever the motivation, though, the result was that the financial institutions started to fall like dominoes and that was when the Feds stepped in with their "Too Big to Fail" ideas.

In truth, these institutions were too stupid to succeed.

They were, in effect, buying thousands of houses at a time, sight unseen, exercising no fiduciary responsibility to their investors and acting like loan sharks. Those left holding the hot potato were the patsies, but they were all culpable.

It is my personal feeling that we should have found a way to really hold the Investment Banking Industry and anybody else responsible for creating what I tend to refer to as a scheme responsible.

For example regulators knew what was happening well before the roof caved in. SEC, the Fed, Treasury and CFTC got together looking for a way out. There was literally no agency defined to regulate the Derivatives Market. It had gone along on its merry way all of these years used by hedgers to hedge swings in their markets. The CFTC chair of that time looked at her authorities and she could make a case that CFTC should take this one. She actually had a good case and was willing to risk the political fallout. Alan Greenspan called her after the meeting and literally threatened to get her fired and make sure she would never work in the financial industry anywhere again! He claimed that the entire environment of hedging would be threatened by regulatory activity within this specific category of Derivative, these Mortgage Instrument Derivatives. That was not only a flawed argument but a specious argument.

We have been segregating Mortgage rules from other rules FOREVER. There was no reason to believe that hedging generally would be impaired by finding a reasonable means to deal with these Mortgage Instrument Derivatives. Greenspan never lived it down and was a broken man at the end.

 

[code1211]

It is my personal feeling that we should have found a way to really hold the Investment Banking Industry and anybody else responsible for creating what I tend to refer to as a scheme responsible.

For example regulators knew what was happening well before the roof caved in. SEC, the Fed, Treasury and CFTC got together looking for a way out. There was literally no agency defined to regulate the Derivatives Market. It had gone along on its merry way all of these years used by hedgers to hedge swings in their markets. The CFTC chair of that time looked at her authorities and she could make a case that CFTC should take this one. She actually had a good case and was willing to risk the political fallout. Alan Greenspan called her after the meeting and literally threatened to get her fired and make sure she would never work in the financial industry anywhere again! He claimed that the entire environment of hedging would be threatened by regulatory activity within this specific category of Derivative, these Mortgage Instrument Derivatives. That was not only a flawed argument but a specious argument.

We have been segregating Mortgage rules from other rules FOREVER. There was no reason to believe that hedging generally would be impaired by finding a reasonable means to deal with these Mortgage Instrument Derivatives. Greenspan never lived it down and was a broken man at the end.

If the practice of demanding a 20% down payment for a house was never abandoned, that would probably have been a good regulator for the problems that eventually seized the market.

Greenspan was a broken man? What makes you say this?

 

[jnug]

If the practice of demanding a 20% down payment for a house was never abandoned, that would probably have been a good regulator for the problems that eventually seized the market.

Greenspan was a broken man? What makes you say this?

Did you see him pre-financial disaster and then post?

Greenspan even admitted his mistake publicly, head down, mumbling, clearly a mess. Greenspan hardly ever in his entire life admitted error within the Financial environment.

 

[code1211]

Did you see him pre-financial disaster and then post?

Greenspan even admitted his mistake publicly, head down, mumbling, clearly a mess. Greenspan hardly ever in his entire life admitted error within the Financial environment.

No economist ever does.

Paul Krugman is wrong on a daily basis and still claims to be right, well, left, oh, you know... correct.

If you gave 10 economists exactly the same information, and asked for a prediction, you'd get 10 contrasting predictions that all disagreed. Those who predict downturns will eventually be right and Krugman uses this as his stock in trade. We're still awaiting the Trump calamity that Krugman predicted would occur on the day after the election of Trump.

As far as Greenspan being a broken man, he's in his 90's. Now, I know that's just barely old enough to be a democrat appointed Supreme Court Justice, but to most of us, that's pretty old.

 

[jnug]

No economist ever does.

Paul Krugman is wrong on a daily basis and still claims to be right, well, left, oh, you know... correct.

If you gave 10 economists exactly the same information, and asked for a prediction, you'd get 10 contrasting predictions that all disagreed. Those who predict downturns will eventually be right and Krugman uses this as his stock in trade. We're still awaiting the Trump calamity that Krugman predicted would occur on the day after the election of Trump.

As far as Greenspan being a broken man, he's in his 90's. Now, I know that's just barely old enough to be a democrat appointed Supreme Court Justice, but to most of us, that's pretty old.

I said before and after. He was mumbling within a year of the event itself. In fact, he was a mumbling wreck in his very first post event hearing. What the heck are you even yanmering about yourself. Do you have a point here or do you just like the sound of your fingers over the keyboard.

 

[code1211]

I said before and after. He was mumbling within a year of the event itself. In fact, he was a mumbling wreck in his very first post event hearing. What the heck are you even yanmering about yourself. Do you have a point here or do you just like the sound of your fingers over the keyboard.

I do have terrific fingers...

 

[JasperL]

There's regulation and then there's regulation.

Regulation of the financial industry is a good thing to a point. It protects the little guys from the big bullies. However, it can be either a guide wire or a noose for the whole economy depending on how the regulations are written and enforced.

The banking crisis was based on a variety of problems that stemmed from the bundling of home loans that were assumed to have been accurately valued EVEN THOUGH EVERYONE IN THE BUSINESS KNEW THEY WERE NOT ACCURATELY VALUED.

The bundles were like cars without engines being sold as if they were cherry.

When the audits occurred and the value of the bundles were pegged correctly, the house of cards fell. Those bundles were not assembled by the guys in the Ivory Towers. They were assembled by the worker ants.

"Worker ants" who made $millions and their supervisors who made often $10s of millions. And if the guys in the ivory tower don't know their senior leadership is handing out money like it's free to anyone with a pulse, and selling crap for securities and sticking their firms with the dog crap that was so toxic no one would buy it, then they shouldn't be CEOs, because they FAILED at their CORE JOB, which was protecting their firms from blowing up then collapsing, requiring you and me to bail them out.

The folks who were told that the house they bought in 1995 had doubled in value and so took out that second mortgage did not have a gun to their head and the guy in the ivory Tower did not make them do it.

No but the guys in the ivory Tower got rich, and the guy who took out the second mortgage got f'd, underwater, many lost their homes and all they had invested in it. I just don't get the reluctance to put the blame where it belongs, at the top. They get paid 7 and 8 figures, and lots of people are all too willing to give them credit, and $10s of millions in bonuses, when the times are good, then those assholes in the penthouse blame the little guys when things turn to crap.

The folks, like me, who had a 401K that went berserk in that period did nothing but let 'er ride and reaped pretty good benefits.

Nobody was completely disconnected from the benefits on the way up and those that overextended during the run up really got swatted on the way down.

Everyone got swatted to some extent on the way down. It happened. It's happened before. It'll happen again.

I'm just saying when a firm fails, the blame should go to the top. When did it become the American Way to put a sign on the desk - "They buck stops at some little person's desk a few floors down - it's HIS FAULT! I'm just the boss!"

 

[code1211]

"Worker ants" who made $millions and their supervisors who made often $10s of millions. And if the guys in the ivory tower don't know their senior leadership is handing out money like it's free to anyone with a pulse, and selling crap for securities and sticking their firms with the dog crap that was so toxic no one would buy it, then they shouldn't be CEOs, because they FAILED at their CORE JOB, which was protecting their firms from blowing up then collapsing, requiring you and me to bail them out.



No but the guys in the ivory Tower got rich, and the guy who took out the second mortgage got f'd, underwater, many lost their homes and all they had invested in it. I just don't get the reluctance to put the blame where it belongs, at the top. They get paid 7 and 8 figures, and lots of people are all too willing to give them credit, and $10s of millions in bonuses, when the times are good, then those assholes in the penthouse blame the little guys when things turn to crap.



I'm just saying when a firm fails, the blame should go to the top. When did it become the American Way to put a sign on the desk - "They buck stops at some little person's desk a few floors down - it's HIS FAULT! I'm just the boss!"

So you are absolving anyone who did not earn a million or more each year?

That's your right. I just don't know why you are doing so.

 

[code1211]

"Worker ants" who made $millions and their supervisors who made often $10s of millions. And if the guys in the ivory tower don't know their senior leadership is handing out money like it's free to anyone with a pulse, and selling crap for securities and sticking their firms with the dog crap that was so toxic no one would buy it, then they shouldn't be CEOs, because they FAILED at their CORE JOB, which was protecting their firms from blowing up then collapsing, requiring you and me to bail them out.



No but the guys in the ivory Tower got rich, and the guy who took out the second mortgage got f'd, underwater, many lost their homes and all they had invested in it. I just don't get the reluctance to put the blame where it belongs, at the top. They get paid 7 and 8 figures, and lots of people are all too willing to give them credit, and $10s of millions in bonuses, when the times are good, then those assholes in the penthouse blame the little guys when things turn to crap.



I'm just saying when a firm fails, the blame should go to the top. When did it become the American Way to put a sign on the desk - "They buck stops at some little person's desk a few floors down - it's HIS FAULT! I'm just the boss!"

So you are absolving anyone who did not earn a million or more each year?

That's your right. I just don't know why you are doing so.