Net worth of U.S. family drops 40% in 3 years

[Toro]

Drama queen.
Last I checked, we still had an FDIC. We still had social security. We still had an SEC. We actually had MORE regulation, not less than under FDR. Truth IN Lending, anyone?
What economic protection was repealed? There has not been a repeal of any regulation since Clinton signed Gramm-Bliley-Leach.

How do people become so stupid?

Bullshit.

Glass-Steagal was repealed by a Republican congress in 2000. Clinton did in fact sign the Gramm-Leach piece of crap legislation they presented him, I'll give you that.

Of course, by that time the Republican Congress had made him pretty much completely powerless with all their bullshit over blowjobs, so even if he had vetoed it, the veto would have been overturned anyway.

And the overturn of the Glass-Steagal act was the single largest factor in the severity of the economic collapse.

Which is why, and I notice you didn't answer my question, Americans lost 40% of their net worth overnight, which hasn't happened since 1929-1930. Which of course was my point.

So one piece of legislation passed in 2000 was responsible for a global meltdown 8 years later? Is that really your theory here?
Americans lost that much net worth because Obama's policies depressed the housing market and the labor market. When he took office no one was pointing to lost net worth, which at that point didnt approach 40%. this is what 3 years of total Dem control and 5 years of Dem Congressional control give you.
Fortunately that's all over Jan 2013.

Conservatives like to point to CRA and GSE laws causing the Financial Crisis 10, 20 and 30 years later. Just sayin'.

 

[Toro]

Yeeeesssss...

Obama and Jesse Jackson traveled to Iceland in the early 2000s to force the banks there to make loans to the negroes of Iceland. And then they were joined by Al Sharpton when they went to Ireland and forced the Irish banks to make loans to the negroes of Ireland. From there, it was just a short jump to England to force those banks to give the negroes of England subprime loans. You can trace their steps from bubble to bubble. Icleand, Ireland, England, Italy, Spain.

Then they forced the broker-dealers to bundle all these toxic loans into CDOs and sell them to pension funds, insurance companies, college endowment funds, city treasurers and banks around the world. Barack Obama invented structured products. And Chris Dodd invented the secondary market and created the GSEs from a little mud and spit. That the GSEs made up less than half the market during the peak of the bubble is immaterial!


If you drove around your town from 2008 to 2010 and noticed a far higher than normal FOR SALE signs in front of your white neighbors' houses, that had NOTHING to do with any of this. It was all the negroes.

So what if a middle class person can take out a bigger loan than a negro and thus net a much higher profit than a negro? The banks were just not interested in all those millions of middle class borrowers. Hell no. They left them all out in the cold. They gave all their cash to the negroes. There was an explosion of negro loans. There certainly wasn't an even bigger explosion of loans to white people! WTF are you on?

It was all the negroes' fault, I say. That cursed CRA. If you can't find a single CEO of a single Wall Street bank to back me up on this, that's your problem, not mine. So what if Dick Fuld said, "De minimus" when asked how much the CRA had to do with his broker-dealership exploding. What the ever loving fuck does he know? I heard it on Fox News. You can't fight Fox News. They reported it was the CRA, and I decided they were right. Dick Fuld doesn't know shit.

All those banks that blew up in other countries? I don't have any idea what you are talking about. This was strictly an American negro problem.

cause ---> effect

effect = global housing bubble
cause = ???

fn(global housing bubble) = (excess creation of credit, X, Y, Z ...)

fn(excess creation of credit) = factors relating to credit creation

fn(credit creation) ---> (Federal Reserve, GSEs, banks, Wall Street, excess savings in Asia, deregulation, X, Y, Z ...)

GSE conforming mortgage defaults < average
GSE funded home price increases < average
GSE funded home price declines < average
GSE leverage > average

Conclusion
GSEs played a role in the Housing Crisis but weren't the primary driver.


If CRA = housing bubble
Then CRA housing price increases > average, CRA mortgage defaults > average, CRA housing price declines > average.

Results
CRA housing price increases <= average
CRA mortgage defaults <= average
CRA housing price declined < average

Conclusion
CRA did not play a role in the Housing Crisis

 

[The Rabbi]

Bullshit.

Glass-Steagal was repealed by a Republican congress in 2000. Clinton did in fact sign the Gramm-Leach piece of crap legislation they presented him, I'll give you that.

Of course, by that time the Republican Congress had made him pretty much completely powerless with all their bullshit over blowjobs, so even if he had vetoed it, the veto would have been overturned anyway.

And the overturn of the Glass-Steagal act was the single largest factor in the severity of the economic collapse.

Which is why, and I notice you didn't answer my question, Americans lost 40% of their net worth overnight, which hasn't happened since 1929-1930. Which of course was my point.

So one piece of legislation passed in 2000 was responsible for a global meltdown 8 years later? Is that really your theory here?
Americans lost that much net worth because Obama's policies depressed the housing market and the labor market. When he took office no one was pointing to lost net worth, which at that point didnt approach 40%. this is what 3 years of total Dem control and 5 years of Dem Congressional control give you.
Fortunately that's all over Jan 2013.

Conservatives like to point to CRA and GSE laws causing the Financial Crisis 10, 20 and 30 years later. Just sayin'.

I never blamed CRA. It wasn't the GSE law, it was the conduct of the GSEs that helped all this. The WSJ ran editorials about 2 years before the crash on Freddie Mac warning about its lack of opacity in its reporting.

 

[KissMy]

GSE's may not have been the only cause but GSE's do cause Housing bubbles. Look at the problems Ginni Mae caused in 1972.

"In spring 1972, a major scandal struck the Federal Housing Administration (FHA), which since passage of the Housing and Urban Development Act of 1968 and the creation of the Government National Mortgage Association (Ginnie Mae) had been responsible for helping the poor buy homes in inner-city areas via government-backed mortgages. This was financed by mortgage-backed securities, the first issues of which George Romney had announced in 1970. A number of FHA employees, along with a number of real estate firms and lawyers, were indicted for a scheme in which the value of cheap inner city homes was inflated and sold using those government-backed mortgages to black buyers who could not really afford them, and the government was stuck for the bad loans when owners defaulted. FHA was under Romney's purview, and he conceded that HUD had been unprepared to deal with speculators and had not been alert to earlier signs of illegal activity. The FHA scandal gave Nixon the ability to shut down HUD's remaining desegregation efforts with little political risk; by January 1973, all federal housing funds had been frozen."

This time this scheme was legal & no one went to jail. They all got filthy rich bankrupting families & screwing investors.

 

[Vast LWC]

GSE's may not have been the only cause but GSE's do cause Housing bubbles. Look at the problems Ginni Mae caused in 1972.

"In spring 1972, a major scandal struck the Federal Housing Administration (FHA), which since passage of the Housing and Urban Development Act of 1968 and the creation of the Government National Mortgage Association (Ginnie Mae) had been responsible for helping the poor buy homes in inner-city areas via government-backed mortgages. This was financed by mortgage-backed securities, the first issues of which George Romney had announced in 1970. A number of FHA employees, along with a number of real estate firms and lawyers, were indicted for a scheme in which the value of cheap inner city homes was inflated and sold using those government-backed mortgages to black buyers who could not really afford them, and the government was stuck for the bad loans when owners defaulted. FHA was under Romney's purview, and he conceded that HUD had been unprepared to deal with speculators and had not been alert to earlier signs of illegal activity. The FHA scandal gave Nixon the ability to shut down HUD's remaining desegregation efforts with little political risk; by January 1973, all federal housing funds had been frozen."

This time this scheme was legal & no one went to jail. They all got filthy rich bankrupting families & screwing investors.

OK, two things:

1. George Romney? Mitt Romney's father was the godfather of the mortgage-backed security? Holy shit, now there's a coincidence. Well I'm learning all kinds of stuff in this thread.

and

2. While I would agree that you are correct in saying that GSE's can play a role in housing bubbles, I would say that fraud on the part of not only the federal employees, but the private real estate people was the cause of the bubble you mentioned. Just as fraud on the part of ratings agencies was a large part of the recent crisis.

 

[Douger]

Brazil's Lula slams rich countries and IMF

 

[KissMy]

GSE's may not have been the only cause but GSE's do cause Housing bubbles. Look at the problems Ginni Mae caused in 1972.

"In spring 1972, a major scandal struck the Federal Housing Administration (FHA), which since passage of the Housing and Urban Development Act of 1968 and the creation of the Government National Mortgage Association (Ginnie Mae) had been responsible for helping the poor buy homes in inner-city areas via government-backed mortgages. This was financed by mortgage-backed securities, the first issues of which George Romney had announced in 1970. A number of FHA employees, along with a number of real estate firms and lawyers, were indicted for a scheme in which the value of cheap inner city homes was inflated and sold using those government-backed mortgages to black buyers who could not really afford them, and the government was stuck for the bad loans when owners defaulted. FHA was under Romney's purview, and he conceded that HUD had been unprepared to deal with speculators and had not been alert to earlier signs of illegal activity. The FHA scandal gave Nixon the ability to shut down HUD's remaining desegregation efforts with little political risk; by January 1973, all federal housing funds had been frozen."

This time this scheme was legal & no one went to jail. They all got filthy rich bankrupting families & screwing investors.

OK, two things:

1. George Romney? Mitt Romney's father was the godfather of the mortgage-backed security? Holy shit, now there's a coincidence. Well I'm learning all kinds of stuff in this thread.

and

2. While I would agree that you are correct in saying that GSE's can play a role in housing bubbles, I would say that fraud on the part of not only the federal employees, but the private real estate people was the cause of the bubble you mentioned. Just as fraud on the part of ratings agencies was a large part of the recent crisis.

1. - This same scheme has been around for hundreds of years. In the 1920's the "Mortgage-Backed Security" (MBS) was called "Participation Certificate" (PC). They also contributed to the bubble that crashed in 1929.

2. - A GSE is the sucker who buys lots of the worthless paper & backs it with tax payer money.

3. - Glass&#8211;Steagall Act and the Bank Holding Company Act prevented brokers from backing the worthless paper with depositors hard earned money.

 

[KissMy]

The Disconnect Between Household Wealth and GDP Growth

The world&#8217;s leading economy, in the most dynamic, inventive period in human history, failed to make people a penny richer.

GDP went up. But real wages did not. In fact, people got nowhere financially &#8212; if they were lucky. And many families got caught in the credit/housing bubble. When it blew up they got knocked back&#8230;actually losing wealth.

We&#8217;ll give you the conclusion before we give you the facts: the &#8220;growth&#8221; in the last 20 years was largely phony. The wheels on the economy spun around faster and faster. The shopping malls were full. Houses were built on nearly every vacant lot. Wall Street cashed big checks. But, overall, it was an illusion. Compared to a real boom, it was a counterfeit. Nobody got anywhere.

 

[The Rabbi]

The Disconnect Between Household Wealth and GDP Growth

The world’s leading economy, in the most dynamic, inventive period in human history, failed to make people a penny richer.

GDP went up. But real wages did not. In fact, people got nowhere financially — if they were lucky. And many families got caught in the credit/housing bubble. When it blew up they got knocked back…actually losing wealth.

We’ll give you the conclusion before we give you the facts: the “growth” in the last 20 years was largely phony. The wheels on the economy spun around faster and faster. The shopping malls were full. Houses were built on nearly every vacant lot. Wall Street cashed big checks. But, overall, it was an illusion. Compared to a real boom, it was a counterfeit. Nobody got anywhere.

Sorry. Utter bullshit.
Are you better off than you were 20 years ago? Yeah, so is everyone else.

 

[Vast LWC]

Sorry. Utter bullshit.
Are you better off than you were 20 years ago? Yeah, so is everyone else.

Everyone else who?

Since average family Net Worth has dropped to the level it was in the early 90's...

Apparently there are a whole lot of people that aren't better off than they were 20 years ago.

 

[KissMy]

The Disconnect Between Household Wealth and GDP Growth

The world’s leading economy, in the most dynamic, inventive period in human history, failed to make people a penny richer.

GDP went up. But real wages did not. In fact, people got nowhere financially — if they were lucky. And many families got caught in the credit/housing bubble. When it blew up they got knocked back…actually losing wealth.

We’ll give you the conclusion before we give you the facts: the “growth” in the last 20 years was largely phony. The wheels on the economy spun around faster and faster. The shopping malls were full. Houses were built on nearly every vacant lot. Wall Street cashed big checks. But, overall, it was an illusion. Compared to a real boom, it was a counterfeit. Nobody got anywhere.

Sorry. Utter bullshit.
Are you better off than you were 20 years ago? Yeah, so is everyone else.

I am currently better off but I can clearly see most are not. The ones who look like they are making it have massive debt to income ratios.

 

[The Rabbi]

The Disconnect Between Household Wealth and GDP Growth

Sorry. Utter bullshit.
Are you better off than you were 20 years ago? Yeah, so is everyone else.

I am currently better off but I can clearly see most are not. The ones who look like they are making it have massive debt to income ratios.

How many people have you known over 20 years to compare?

 

[KissMy]

Sorry. Utter bullshit.
Are you better off than you were 20 years ago? Yeah, so is everyone else.

I am currently better off but I can clearly see most are not. The ones who look like they are making it have massive debt to income ratios.

How many people have you known over 20 years to compare?

Hundreds - I travel & repeatedly spend time with lots of people. I also own an insurance agency / mortgage co & run credit & insurance scores on people daily. Their debt to income ratios have been climbing until the credit crunch. Then they lost their income, could not pay & lost their assets & savings. Now their credit is down along with their debt & income. They are worse off than they were.

 

[The Rabbi]

Sorry. Utter bullshit.
Are you better off than you were 20 years ago? Yeah, so is everyone else.

Everyone else who?

Since average family Net Worth has dropped to the level it was in the early 90's...

Apparently there are a whole lot of people that aren't better off than they were 20 years ago.

Statistical fallacy.

 

[The Rabbi]

I am currently better off but I can clearly see most are not. The ones who look like they are making it have massive debt to income ratios.

How many people have you known over 20 years to compare?

Hundreds - I travel & repeatedly spend time with lots of people. I also own an insurance agency / mortgage co & run credit & insurance scores on people daily. Their debt to income ratios have been climbing until the credit crunch. Then they lost their income, could not pay & lost their assets & savings. Now their credit is down along with their debt & income. They are worse off than they were.

Hundreds of people in a 350M population isn't significant.

 

[Vast LWC]

Everyone else who?

Since average family Net Worth has dropped to the level it was in the early 90's...

Apparently there are a whole lot of people that aren't better off than they were 20 years ago.

Statistical fallacy.

Do you argue with the 40% net worth loss figure?

Do you have data that shows differently?

 

[The Rabbi]

Everyone else who?

Since average family Net Worth has dropped to the level it was in the early 90's...

Apparently there are a whole lot of people that aren't better off than they were 20 years ago.

Statistical fallacy.

Do you argue with the 40% net worth loss figure?

Do you have data that shows differently?

You're assuming the stats correlate to real people. That's the fallacy.

 

[signelect]

I'm not sure we even have a name for this swindle.

The United States of America

I can cure your problem, renounce your citizenship and go where life is better. Anywhere but please do it now. Who ever said you were cool lied.

 

[Vast LWC]

You're assuming the stats correlate to real people. That's the fallacy.

So... they took the statistics from what? People in Mongolia?

Or do you feel they just made them up?

 

[The Rabbi]

You're assuming the stats correlate to real people. That's the fallacy.

So... they took the statistics from what? People in Mongolia?

Or do you feel they just made them up?

They are statistical anomalies.
Let's say there are 4 of us working for a company making $20/hr because we've been there for years. Now the company hires 2 more people, but at $10/hr because they are new hires. Suddenly the average wage in the company has dropped from $20/hr to $16.66/hr, an almost 17% drop! So we can all cavil about falling wages in that company.
The averages are all correct. The inputs are right. But reporting the result as I did skews the real picture.
This is no different. Especially when you talk about "household" income (or household anything). Households vary in size. And in fact have gotten smaller over the last 20 years.