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I prefer the government not bail-out or back things with our tax dollars. BUT - If the government is going to back it with our tax dollars then it needs to be regulated.
Government put the banks up to this absurd GSE driven banking model & then put it on steroids. You were warned about this 13 years ago. Then Clinton removed the bank regulations (Shadow Banking System) greasing the skids so everyone could own a home. Government gave banks & GSEs an implicit government guarantee that they will be made whole on bad loans. This allowed Shadow Banks to pay ratings agency's to stamp AAA on this shit because it was now backed by our AAA government. Bush drank Clinton's Kool-Aid. Why else would our government have bailed out AIG who insured this AAA shit & the shadow banks who sold it?
If you look back after the Great Depression when FDR created the FDIC that guaranteed all bank deposits up to $100K. It was the belief of most that everyone would deposit all of their money into the riskiest banks who paid out the highest interest on those deposits triggering an enormous FDIC payout. The governments FDIC guarantee most certainly would have caused this had it not been for their thorough regulation of banks to prevent such an event from playing out.
So what does our brilliant government do? They give even more guarantees & remove the very regulation that prevent banks from abusing the shit out of those guarantees for huge profits that they generously shared with our elected officials who enabled this crap.
Government put the banks up to this absurd GSE driven banking model & then put it on steroids. You were warned about this 13 years ago. Then Clinton removed the bank regulations (Shadow Banking System) greasing the skids so everyone could own a home. Government gave banks & GSEs an implicit government guarantee that they will be made whole on bad loans. This allowed Shadow Banks to pay ratings agency's to stamp AAA on this shit because it was now backed by our AAA government. Bush drank Clinton's Kool-Aid. Why else would our government have bailed out AIG who insured this AAA shit & the shadow banks who sold it?
If you look back after the Great Depression when FDR created the FDIC that guaranteed all bank deposits up to $100K. It was the belief of most that everyone would deposit all of their money into the riskiest banks who paid out the highest interest on those deposits triggering an enormous FDIC payout. The governments FDIC guarantee most certainly would have caused this had it not been for their thorough regulation of banks to prevent such an event from playing out.
So what does our brilliant government do? They give even more guarantees & remove the very regulation that prevent banks from abusing the shit out of those guarantees for huge profits that they generously shared with our elected officials who enabled this crap.