The "Regulation" Argument

Conservatives can whine and complain all they want. The truth is the "prick" that burst the bubble which led to the crash was bundled home mortgages sold as "securities" by Wall Street to overseas investors. Freddie/Fannie never sold bundled mortgages to overseas investors. Wall Street did it. They didn't do it 20 years ago. Why now? Because they had been deregulated and were allowed to.

Go ahead and call names. If that's not what happened, then what did? Make it good.


Fannie Mae and Freddie Mac guaranteed those low quality mortgages (and cooked their books to classify them as higher quality). Without the taxpayer guarantee provided by FM/FM, there would not have been a market for the derivatives.
 

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