Capitalism, Not Democracy, Is The Driver of Wealth and Social Justice

[Oldstyle]

I witnessed lenders, brokers, dealers screwing people. They said they were & if I did not someone else will. I & most others refused to screw our customers. But that did not stop the few from taking advantage of the many as fast as possible including my customers. I was not aware at the time how many people were actually falling for this & got fleeced by these con-men claiming to have their best interest at heart. I also did not know how many con-men were out there around the country doing the same thing. Now I know it was enough to be systemic. Many of my customers went under because someone else fleeced them. So I may as well have done it myself & benefited from their misery instead of simply losing their business as they went under.

Yes this crap really happened. Most people are not financial wizards & actually trusted their financial advisor's. Most people have jobs like construction workers, nurses, diesel mechanics etc. What do they know about Wallstreet? That is why they go to financial experts to advise them. Even the experts can be tricked by complex shady dirivatives. When experts are not required to act as fiduciaries they get screwed & called Muppet's behind their backs. Now most do not trust financial advisor's who do have their best interest at heart. This kills investing, the economy & jobs. The few screwed the many & got away with the cash.

Laws, checks & balances keep vulture people in line. Then if someone breaks them they are removed from the system & jailed. Otherwise they take all they can because hey it' legal, so why not? Who cares government will take care of them when they lose their home & their retirement.

I'm sorry but the concept that people were "tricked" by their financial experts into buying houses that they couldn't afford is laughable. When you sit across the desk from someone who's telling you "In order to qualify for this loan you need to make $80,000 a year...how much do you make?" and you only make $40,000 but lie and tell them that you DO make $80,000 then you are fully cooperating in your own "trickery".

We got into this mess because lending institutions were not using due diligence when they were writing loans. They wrote "liar loans", relying on people's word instead of verifying income. That's bad banking...something we as a nation encouraged with the notion that EVERYONE should be able to buy a house. Bankers wrote bad loans because they no longer apt to hold those loans but instead bundled and sold them to third parties. If you're not going to hold a long term note then obviously you're not going to be all that concerned about it's stability. THAT'S bad banking as well.

Then our legislators dropped the ball by allowing those bundled loans to be classified as something other than a loan so that the financial institutions holding them didn't have to keep as large a cash balance in reserve to pay them off in case of a default. THAT is bad legislating.

So if you want to start putting people in jail for financial stupidity...which is what this was...then you better start building lots of new prisons because the people that lied on their loans are at fault...the bankers who didn't follow good banking procedures are at fault...and the legislators who decided that everyone should be able to buy a house are at fault.

Some did straight out lie. The ones I am talking about were talked into lying or the lender actually changed the numbers or they did not lie at all. I am talking about people who had equity, low debt to income ratio, good credit & made their payments. They give them a presentation of how stupid it was to have good credit & not leverage it & have their equity trapped into just their home. They could max out their home equity credit & invest into the tax free insurance & investment product that returned more money. It would set up a tax free "charitable remainder trust" they could use to fund their childs education, protect them from lawsuits, get them a larger mortgage interest tax deduction plus their home would still go up in value for them covering the 'Negatively Amortizing Loans' they were sold.

People were also told to sign a Accredited Investors form waiving their SEC protections.

When someone "talks you into lying", does that make you any less of a liar? You know as well as I do that the majority of the people signing liar loans knew exactly what they were doing when they falsified those loan applications. This push to exonerate that bad behavior, excuse the politicians for their part in this debacle and make this all the fault of the "mean ole bankers" is ridiculous.

 

[bripat9643]

Well, at the end there is only one driver of wealth creation. Society. Wealth is a meaningless concept absent society. Production does not create wealth without anyone to purchase what is produced, demand creates no wealth unless there is something to purchase. In a complex society, wealth is defined by money and other pieces of paper, which have no intrinsic value of themselves. Their value derives only from the agreement of the society to recognize them as value.

So anything which engenders a healthy society creates wealth.

BWAHAHAHAHAHAH!

God! What an ignoramus!

Try reading a book on economics rather than commie propaganda.

 

[Publius1787]

How did that deregulated free market housing bubble work out for us?

[ame=http://www.youtube.com/watch?v=IyqYY72PeRM]Democrats in their own words Covering up Fannie Mae, Freddie Mac scandal - YouTube[/ame]

[ame=http://www.youtube.com/watch?v=cMnSp4qEXNM]Timeline shows Bush, McCain warning Dems of financial and housing crisis; meltdown - YouTube[/ame]

 

[KissMy]

How did that deregulated free market housing bubble work out for us?

[ame=http://www.youtube.com/watch?v=IyqYY72PeRM]Democrats in their own words Covering up Fannie Mae, Freddie Mac scandal - YouTube[/ame]

[ame=http://www.youtube.com/watch?v=cMnSp4qEXNM]Timeline shows Bush, McCain warning Dems of financial and housing crisis; meltdown - YouTube[/ame]

Can you not read? I have already said that the GSE's & the CRA was a huge part of the problem. Affirmative action lending was their goal.

But there is also a huge problem with running Wallstreet like a unregulated casino instead of actual investment & banking. Taking advantage of borrowers, savers & investors instead of acting on their behalf is destructive to the citizens, economy, markets & country. That must change along with the lending quota crap.

Broken trust in in Wallstreet schemers has caused massive fund outflows. Flash crash & HFT are have scared the shit out of investors. That is just the tip of the iceberg. This will never lead us to prosperity. Predictable, just, fair capitalist financial systems have always done best compared to the sham we had a few years ago.

 

[007]

Twice this week I've been angered by postings on the Internet about how capitalism is undermining our democracy. One was here on these boards. Another was on Andrew Sullivan's web site, where a reader email said:


This irks me because it is an upside down worldview. It is capitalism, it is the freedom to make voluntary associations and exchange goods as we see fit, that allows for true social justice. It is capitalism that creates wealth.

In any instance in which capitalism is counter to democracy, it is because capitalism is a virtuous system and democracy is quite flawed. I am willing to accept Churchill's maxim that democracy is the worst system of government except all the others that have been tried, but I am angered when people suggest what we need is more democracy and less capitalism. Quite the contrary! We need far less democracy so that capitalism can flourish.

Capitalism is not virtuous. Capitalism is an economic theory. Only people can be virtuous. If people were virtuous, capitalism would be a moot issue.

I suggest you go back and take a good look at this county in the late 19th and early 20th centuries. That was when we had our experiment in pure capitalism and you can see how it worked out.

Superb point here.
Anyone who thinks completely unregulated capatlism is the way to go must have slept through their history classes.

And what sort of regulations is it that you feel are absolutely necessary for capitalism... unions?

 

[KissMy]

I'm sorry but the concept that people were "tricked" by their financial experts into buying houses that they couldn't afford is laughable. When you sit across the desk from someone who's telling you "In order to qualify for this loan you need to make $80,000 a year...how much do you make?" and you only make $40,000 but lie and tell them that you DO make $80,000 then you are fully cooperating in your own "trickery".

We got into this mess because lending institutions were not using due diligence when they were writing loans. They wrote "liar loans", relying on people's word instead of verifying income. That's bad banking...something we as a nation encouraged with the notion that EVERYONE should be able to buy a house. Bankers wrote bad loans because they no longer apt to hold those loans but instead bundled and sold them to third parties. If you're not going to hold a long term note then obviously you're not going to be all that concerned about it's stability. THAT'S bad banking as well.

Then our legislators dropped the ball by allowing those bundled loans to be classified as something other than a loan so that the financial institutions holding them didn't have to keep as large a cash balance in reserve to pay them off in case of a default. THAT is bad legislating.

So if you want to start putting people in jail for financial stupidity...which is what this was...then you better start building lots of new prisons because the people that lied on their loans are at fault...the bankers who didn't follow good banking procedures are at fault...and the legislators who decided that everyone should be able to buy a house are at fault.

Some did straight out lie. The ones I am talking about were talked into lying or the lender actually changed the numbers or they did not lie at all. I am talking about people who had equity, low debt to income ratio, good credit & made their payments. They give them a presentation of how stupid it was to have good credit & not leverage it & have their equity trapped into just their home. They could max out their home equity credit & invest into the tax free insurance & investment product that returned more money. It would set up a tax free "charitable remainder trust" they could use to fund their childs education, protect them from lawsuits, get them a larger mortgage interest tax deduction plus their home would still go up in value for them covering the 'Negatively Amortizing Loans' they were sold.

People were also told to sign a Accredited Investors form waiving their SEC protections.

When someone "talks you into lying", does that make you any less of a liar? You know as well as I do that the majority of the people signing liar loans knew exactly what they were doing when they falsified those loan applications. This push to exonerate that bad behavior, excuse the politicians for their part in this debacle and make this all the fault of the "mean ole bankers" is ridiculous.

That is true. Also I never exonerate the liars. The people on the Right are exonerating their Wallstreet liars & the people on the left are exonerating their poor borrowers. I am neither. This disaster proves that liars on either side is destructive. A lender packing a CDO with loans he knows are liar loans & selling them to your pension fund & then betting against them, is even more destructive. A dishonest society is a failed society. A dishonest market is a failed market. Someone has to be responsible. A professional financial representative who profits by serving his clients interest instead of serving himself works best. Profiting by betting against your client that took your advice & calling it market making is destructive.

 

[Oldstyle]

Some did straight out lie. The ones I am talking about were talked into lying or the lender actually changed the numbers or they did not lie at all. I am talking about people who had equity, low debt to income ratio, good credit & made their payments. They give them a presentation of how stupid it was to have good credit & not leverage it & have their equity trapped into just their home. They could max out their home equity credit & invest into the tax free insurance & investment product that returned more money. It would set up a tax free "charitable remainder trust" they could use to fund their childs education, protect them from lawsuits, get them a larger mortgage interest tax deduction plus their home would still go up in value for them covering the 'Negatively Amortizing Loans' they were sold.

People were also told to sign a Accredited Investors form waiving their SEC protections.

When someone "talks you into lying", does that make you any less of a liar? You know as well as I do that the majority of the people signing liar loans knew exactly what they were doing when they falsified those loan applications. This push to exonerate that bad behavior, excuse the politicians for their part in this debacle and make this all the fault of the "mean ole bankers" is ridiculous.

That is true. Also I never exonerate the liars. The people on the Right are exonerating their Wallstreet liars & the people on the left are exonerating their poor borrowers. I am neither. This disaster proves that liars on either side is destructive. A lender packing a CDO with loans he knows are liar loans & selling them to your pension fund & then betting against them, is even more destructive. A dishonest society is a failed society. A dishonest market is a failed market. Someone has to be responsible. A professional financial representative who profits by serving his clients interest instead of serving himself works best. Profiting by betting against your client that took your advice & calling it market making is destructive.

So why do you seem to only want to hold those in the financial sector "responsible" when the housing bubble was something that was also caused by the people's greed and the politician's ineptness? Where are your calls for the heads of the politicians who passed the legislation that CAUSED everything that you list above? Why do we continue to bail out those loan seekers who DID lie on their loan applications? I'm not exonerating anyone. If lenders broke the law then they should be held accountable. If those that sought those loans, lied they shouldn't be rewarded for their actions. And if politicians were either too blinded by ideology or too stupid to understand that their votes were destructive then they shouldn't be representing us in Washington.