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What caused the recession, hmm.
Short answer: Greed & incompetence.
Longer answer:
Greed demonstrated by those in the financial services industry who created impossibly complex financial products and then pushed them onto people who could not possibly have understood them. Greed demonstrated by those same people who bought impossibly complex financial products even though they didn't even fucking understand them. They were just excited by their expected returns.
Greed demonstrated by consumers who knew damn well they were getting into mortgages that included payments that were going to increase in the future - that didn't stop them or course, since they just had to have a bigger house, right now, no matter what.
Greed demonstrated by mortgage companies that created and offered mortgages that didn't even require proof of income or employment. Greed demonstrated by the consumers who willingly purchased homes even though they knew they could not afford them, but what the hell, they didn't even have to report their income or employment.
Greed demonstrated by consumers who hopped right in to one of those 125% LTV home equity loans so that they could pay off bills they'd later run back up, and to buy all kinds of really cool goodies they didn't need, especially at the cost of their equity.
Incompetence demonstrated by government regulators who had an abject inability to properly stay on top of new and complex financial instruments as they were being foisted on buyers.
Incompetence demonstrated by politicians who bend over for the knee jerk notion that less regulation is always better, they're just as dense as the politicians who think MORE regulation is always better. Regulation failed here, gang.
Incompetence demonstrated by the ratings agencies when they provided A ratings to CMO's that turned out to be steaming piles of shit (although this could also fall under the category of greed, since the ratings agencies want to stay in the good graces of certain clients).
Greed demonstrated by AIG, which just kept writing credit default swaps knowing damn well that they didn't have proper reserves, coupled with the incompetence demonstrated by our stupid shit regulators who let it all happen right under their nose.
The Great Recession? A team effort. A symptom of a culture in rapid decay.
.
What caused the recession, hmm.
Short answer: Greed & incompetence.
Longer answer:
Greed demonstrated by those in the financial services industry who created impossibly complex financial products and then pushed them onto people who could not possibly have understood them. Greed demonstrated by those same people who bought impossibly complex financial products even though they didn't even fucking understand them. They were just excited by their expected returns.
Greed demonstrated by consumers who knew damn well they were getting into mortgages that included payments that were going to increase in the future - that didn't stop them or course, since they just had to have a bigger house, right now, no matter what.
Greed demonstrated by mortgage companies that created and offered mortgages that didn't even require proof of income or employment. Greed demonstrated by the consumers who willingly purchased homes even though they knew they could not afford them, but what the hell, they didn't even have to report their income or employment.
Greed demonstrated by consumers who hopped right in to one of those 125% LTV home equity loans so that they could pay off bills they'd later run back up, and to buy all kinds of really cool goodies they didn't need, especially at the cost of their equity.
Incompetence demonstrated by government regulators who had an abject inability to properly stay on top of new and complex financial instruments as they were being foisted on buyers.
Incompetence demonstrated by politicians who bend over for the knee jerk notion that less regulation is always better, they're just as dense as the politicians who think MORE regulation is always better. Regulation failed here, gang.
Incompetence demonstrated by the ratings agencies when they provided A ratings to CMO's that turned out to be steaming piles of shit (although this could also fall under the category of greed, since the ratings agencies want to stay in the good graces of certain clients).
Greed demonstrated by AIG, which just kept writing credit default swaps knowing damn well that they didn't have proper reserves, coupled with the incompetence demonstrated by our stupid shit regulators who let it all happen right under their nose.
The Great Recession? A team effort. A symptom of a culture in rapid decay.
.
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