Krugman rips von Mises up one side & down the other

[CrusaderFrank]

.the damage was already done by Wall Street bankster and PRIVATE lenders outside of government regulations.

too stupid by 1000%!! Wall Street operated within an environment created by Fed Fanny Fred, etc etc .Did the dummy think Wall Street printed its own money to constantly inflate the housing market?

Is it possible you are THAT dense? Wall Street created their own environment. They were catering to speculators had who NO INTEREST in a "mortgage". They were NOT buying a homestead. They CRAVED gimmicks that would allow them to buy multiple homes with ZERO down. They were merely buying an investment to flip for profit.

Truly stop and THINK. No one can be THAT dense.

You have no idea how "Wall Street" works. They were supplying F/F with the paper they wanted and were making their own synthetic AAA SubPrime crap paper

 

[CrusaderFrank]

Hey MORON, NONE of those private gimmick loans were 'guaranteed' by the government. .

all homes in America were seemingly guaranteed by the Fed's history of always inflating home prices and the Greenspan Put. Do you feel stupid for trying to pretend that the most massively interfered with market in America History was not massively interfered with?

Conservatism in a nutshell...

I had a flat tire. It is the government's fault. **** personal responsibility. Just blame government for all my actions.

The government was giving me flat tire insurance no matter what condition the tires were in so I drove over anything and everything

 

[Dot Com]

Krugman was right AGAIN about failed rw laissez faire/the market/banks will regulate themselves theory.

 

[Bfgrn]

.the damage was already done by Wall Street bankster and PRIVATE lenders outside of government regulations.

too stupid by 1000%!! Wall Street operated within an environment created by Fed Fanny Fred, etc etc .Did the dummy think Wall Street printed its own money to constantly inflate the housing market?

Is it possible you are THAT dense? Wall Street created their own environment. They were catering to speculators had who NO INTEREST in a "mortgage". They were NOT buying a homestead. They CRAVED gimmicks that would allow them to buy multiple homes with ZERO down. They were merely buying an investment to flip for profit.

Truly stop and THINK. No one can be THAT dense.

You have no idea how "Wall Street" works. They were supplying F/F with the paper they wanted and were making their own synthetic AAA SubPrime crap paper

You are talking totally out of your ass again Frank...Fannie and Freddie LOST market share, and the Wall Street banksters were using PRIVATE label mortgage backed securities.

Private-Label Mortgage Backed Securities

Private-label mortgage backed securities are securitized mortgages that do not conform to the criteria set by the Government Sponsored Enterprises Freddie Mac, Fannie Mae and Ginnie Mae. The mortgages that make up these securities do not have the backing of the government and as a result carry a significantly greater risk. Below is a diagram that represents the types of mortgages that would not classify as GSE conforming loans.

Many the mortgages that made up private-label mortgage backed securities were ‘Jumbo Loans’ with a loan amount of more than $415,000. During the housing bubble build-up, housing prices were inflating and as the average home price increased more and more loans became non-conforming Jumbo Loans.

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitch to prescribe the amount of risk associated with private label securities. These private label securities earned great ratings from the credit agencies. In fact, the vast majority of private label debt was rated AAA, the highest rating achievable, second only to debt that was government insured (Gorton 25). The appeal to investors was a higher return as to the comparable government insured securities.

So what was the problem? The ratings weren’t accurate for a number of important reasons. Many of the models that were used to ascertain the riskiness of these mortgage back securities used a method known as “independent observations”. The models assumed that each observed change in an underlying asset would not affect any other asset. This turned out to be a terrible assumption because as people began defaulting placed downward pressure on overall home prices. These ratings looked very appealing with the higher rate of return and many people invested with confidence in the credit rating agencies marks, frequently in individual retirement accounts and pension funds (Adrian & Shin 11). When the bubble eventually collapsed and debt issuers were unable to make good on their securities, investors absorbed the brute impact of the firm failures.

 

[CrusaderFrank]

.the damage was already done by Wall Street bankster and PRIVATE lenders outside of government regulations.

too stupid by 1000%!! Wall Street operated within an environment created by Fed Fanny Fred, etc etc .Did the dummy think Wall Street printed its own money to constantly inflate the housing market?

Is it possible you are THAT dense? Wall Street created their own environment. They were catering to speculators had who NO INTEREST in a "mortgage". They were NOT buying a homestead. They CRAVED gimmicks that would allow them to buy multiple homes with ZERO down. They were merely buying an investment to flip for profit.

Truly stop and THINK. No one can be THAT dense.

You have no idea how "Wall Street" works. They were supplying F/F with the paper they wanted and were making their own synthetic AAA SubPrime crap paper

You are talking totally out of your ass again Frank...Fannie and Freddie LOST market share, and the Wall Street banksters were using PRIVATE label mortgage backed securities.

Private-Label Mortgage Backed Securities

Private-label mortgage backed securities are securitized mortgages that do not conform to the criteria set by the Government Sponsored Enterprises Freddie Mac, Fannie Mae and Ginnie Mae. The mortgages that make up these securities do not have the backing of the government and as a result carry a significantly greater risk. Below is a diagram that represents the types of mortgages that would not classify as GSE conforming loans.

Many the mortgages that made up private-label mortgage backed securities were ‘Jumbo Loans’ with a loan amount of more than $415,000. During the housing bubble build-up, housing prices were inflating and as the average home price increased more and more loans became non-conforming Jumbo Loans.

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitch to prescribe the amount of risk associated with private label securities. These private label securities earned great ratings from the credit agencies. In fact, the vast majority of private label debt was rated AAA, the highest rating achievable, second only to debt that was government insured (Gorton 25). The appeal to investors was a higher return as to the comparable government insured securities.

So what was the problem? The ratings weren’t accurate for a number of important reasons. Many of the models that were used to ascertain the riskiness of these mortgage back securities used a method known as “independent observations”. The models assumed that each observed change in an underlying asset would not affect any other asset. This turned out to be a terrible assumption because as people began defaulting placed downward pressure on overall home prices. These ratings looked very appealing with the higher rate of return and many people invested with confidence in the credit rating agencies marks, frequently in individual retirement accounts and pension funds (Adrian & Shin 11). When the bubble eventually collapsed and debt issuers were unable to make good on their securities, investors absorbed the brute impact of the firm failures.

F/F set the standard for AAA Rated paper, they rated subprime no income no asset loans AAA and everything priced back from there

 

[Dot Com]

yep. this is from years ago Frank57:

FactWatch Fannie and Freddie were followers not leaders in mortgage frenzy Center for Public Integrity

GOP.gov, the official website for Republicans in the House of Representatives, says flatly: “Fannie Mae and Freddie Mac were the main cause of the nation's current financial turmoil.” Many critics — including Republican appointees to the federal Financial Crisis Inquiry Commission — blame the two government-chartered mortgage underwriters for pushing lenders to make riskier loans and leading the way into the financial crash.

There’s a problem with this narrative: The numbers tell a different story.

 

[Bfgrn]

.the damage was already done by Wall Street bankster and PRIVATE lenders outside of government regulations.

too stupid by 1000%!! Wall Street operated within an environment created by Fed Fanny Fred, etc etc .Did the dummy think Wall Street printed its own money to constantly inflate the housing market?

Is it possible you are THAT dense? Wall Street created their own environment. They were catering to speculators had who NO INTEREST in a "mortgage". They were NOT buying a homestead. They CRAVED gimmicks that would allow them to buy multiple homes with ZERO down. They were merely buying an investment to flip for profit.

Truly stop and THINK. No one can be THAT dense.

You have no idea how "Wall Street" works. They were supplying F/F with the paper they wanted and were making their own synthetic AAA SubPrime crap paper

You are talking totally out of your ass again Frank...Fannie and Freddie LOST market share, and the Wall Street banksters were using PRIVATE label mortgage backed securities.

Private-Label Mortgage Backed Securities

Private-label mortgage backed securities are securitized mortgages that do not conform to the criteria set by the Government Sponsored Enterprises Freddie Mac, Fannie Mae and Ginnie Mae. The mortgages that make up these securities do not have the backing of the government and as a result carry a significantly greater risk. Below is a diagram that represents the types of mortgages that would not classify as GSE conforming loans.

Many the mortgages that made up private-label mortgage backed securities were ‘Jumbo Loans’ with a loan amount of more than $415,000. During the housing bubble build-up, housing prices were inflating and as the average home price increased more and more loans became non-conforming Jumbo Loans.

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitch to prescribe the amount of risk associated with private label securities. These private label securities earned great ratings from the credit agencies. In fact, the vast majority of private label debt was rated AAA, the highest rating achievable, second only to debt that was government insured (Gorton 25). The appeal to investors was a higher return as to the comparable government insured securities.

So what was the problem? The ratings weren’t accurate for a number of important reasons. Many of the models that were used to ascertain the riskiness of these mortgage back securities used a method known as “independent observations”. The models assumed that each observed change in an underlying asset would not affect any other asset. This turned out to be a terrible assumption because as people began defaulting placed downward pressure on overall home prices. These ratings looked very appealing with the higher rate of return and many people invested with confidence in the credit rating agencies marks, frequently in individual retirement accounts and pension funds (Adrian & Shin 11). When the bubble eventually collapsed and debt issuers were unable to make good on their securities, investors absorbed the brute impact of the firm failures.

F/F set the standard for AAA Rated paper, they rated subprime no income no asset loans AAA and everything priced back from there

You are so full of shit you your breath smells like a fart.

Credit rating agencies and the subprime crisis

Credit rating agencies (CRAs) — firms which rate debt instruments/securities according to the debtor's ability to pay lenders back — played a significant role at various stages in the American subprime mortgage crisis of 2007-2008 that led to the Great Recession of 2008-2009. The new, complex securities of "structured finance" used to finance subprime mortgages could not have been sold without ratings by the "Big Three" rating agencies — Moody's Investors Service, Standard & Poor's, and Fitch Ratings. A large section of the debt securities market — many money markets and pension funds — were restricted in their bylaws to holding only the safest securities — i.e securities the rating agencies designated "triple-A".[1] The pools of debt the agencies gave their highest ratings to [2] included over three trillion dollars of loans to homebuyers with bad credit and undocumented incomes through 2007.[3] Hundreds of billions dollars' worth of these triple-A securities were downgraded to "junk" status by 2010,

Mortgage-related securities
Ratings were/are vital to "private-label" asset-backed securities — such as subprime mortgage-backed securities (MBS), and collateralized debt obligations (CDO), "CDOs squared", and "synthetic CDOs" — whose "financial engineering" make them "harder to understand and to price than individual loans".[9]

Earlier traditional and more simple "prime" mortgage securities were issued and guaranteed by Fannie Mae and Freddie Mac -- "enterprises" sponsored by the Federal government. Their safety wasn't questioned by conservative money managers. Non-prime private label mortgage securities were neither made up of loans to borrowers with high credit ratings nor insured by a government enterprise, so issuers used an innovation in securities structure to get higher agency ratings. They pooled debt and then "sliced" the result into "tranches", each with a different priority in the debt repayment stream of income.[10] The most "senior" tranches highest up in priority of revenue—which usually made up most of the pool of debt—received the triple A ratings

more

 

[Bfgrn]

You couldn't have ever read that post before you hit "Disagree" Frank. I posted it at 10:53 AM and your "Disagree" is time stamped at 10:53AM.

WHY are you right wing turds so ******* stupid?

 

[CrusaderFrank]

You can't argue with people when all they know is what they cut and paste.

They don't know what a GSE is

They don't know what sub prime is.

How can you argue with them?

 

[CrusaderFrank]

Q. Is a No Income No Asset loan "Sub prime"?

 

[Bfgrn]

You can't argue with people when all they know is what they cut and paste.

They don't know what a GSE is

They don't know what sub prime is.

How can you argue with them?

I know what both of those are. What you can't accept is your beloved private sector caused the crisis.

 

[dblack]

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

 

[Bfgrn]

Q. Is a No Income No Asset loan "Sub prime"?

Sub prime generally refers to the credit rating of the borrower and is usually Alt-A classification

 

[Bfgrn]

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

You clearly don't know what you are talking about.

The ONLY MBS (mortgage backed securities) guaranteed by the government is Ginnie Mae (the Government National Mortgage Association)
Fannie Mae MBS is NOT guaranteed by the government
Freddie Mac MBS is NOT guaranteed by the government
Private label MBS is NOT guaranteed by the government.

 

[Dot Com]

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

A Republican was manning the SEC at the time of the crash & we all know how much libertarians & Repubs like regulation such as OSHA, EPA, etc... You CAN'T be serious son

STOP THE LYING!!!

 

[CrusaderFrank]

Q. Is a No Income No Asset loan "Sub prime"?

Sub prime generally refers to the credit rating of the borrower and is usually Alt-A classification

In your opinion, is a loan where the borrower does not have to disclose his income level or any of his assets worthy of a AAA rating?

 

[dblack]

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

A Republican was manning the SEC at the time of the crash & we all know how much libertarians & Repubs like regulation such as OSHA, EPA, etc... You CAN'T be serious son

STOP THE LYING!!!

???

 

[dblack]

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

You clearly don't know what you are talking about.

The ONLY MBS (mortgage backed securities) guaranteed by the government is Ginnie Mae (the Government National Mortgage Association)
Fannie Mae MBS is NOT guaranteed by the government
Freddie Mac MBS is NOT guaranteed by the government
Private label MBS is NOT guaranteed by the government.

And what happened when all these companies face bankruptcy? Who bailed them out? Are you familiar with the term 'moral hazard'? Are you thinking about this at all, or this just a partisan cheerleading contest?

 

[Bfgrn]

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

You clearly don't know what you are talking about.

The ONLY MBS (mortgage backed securities) guaranteed by the government is Ginnie Mae (the Government National Mortgage Association)
Fannie Mae MBS is NOT guaranteed by the government
Freddie Mac MBS is NOT guaranteed by the government
Private label MBS is NOT guaranteed by the government.

And what happened when all these companies face bankruptcy? Who bailed them out? Are you familiar with the term 'moral hazard'? Are you thinking about this at all, or this just a partisan cheerleading contest?

Without the government insurance, private-label mortgage backed securities relied on credit rating agencies to inspire confidence in investors that the debt was safe. Debt holders relied on credit rating agencies such as Moody's, Standard & Poor's, and Fitchs.

this is rich!!! the illiterate liberal provides a source contradicting his own argument that the govt was not involved in the housing market!

Do you have a severe brain injury. There is NOTHING that contradicts the FACT NONE of those Wall Street gimmick loans were government backed.

Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies.

Standard & Poor's Financial Services LLC (S&P) is an American financial services company. It is a division of McGraw Hill Financial that publishes financial research and analysis on stocks and bonds.

Fitch Ratings Inc. is a jointly owned subsidiary of Hearst Corporation and FIMALAC SA.[2] On April 12, 2012, Hearst increased their stake in the Fitch Group to 50%.[3] Previously, Hearst owned a 40% stake in the company, while FIMALAC was the majority owner with 60% stake.[4] Fitch Ratings and Fitch Solutions are part of the Fitch Group.

wiki

dear, are you saying in your 100% illiterate and retarded way that ratings agencies were not govt controlled? This is yes or no question!!

There are some FACTS you just can't seem to comprehend and digest. These Wall Street private lenders and speculators who were buying multiple homes to create a 'get rich quick' scheme did NOT WANT government backed mortgages. They did NOT want loans that had traditional lending standard RULES. They WANTED gimmick loans. WHY you may ask...because they were NOT buying a homestead. They already had a HOME. It was an INVESTMENT. Nothing more and nothing less.

Indeed. Nothing less. The problem wasn't with the concept of investment, or speculation; both of which are important functions in a free economy. The problem was the lack of prudence. Which, again, is endemic in a regulated market place, where "buyer beware" devolves to pushing the limits allowed by law.

You have a very serious mental disorder. You believe in 'magic' and 'fairy dust'...

The investors and speculators got EXACTLY what they wanted. There was no government interference, restraint, control or regulations to ignore.

And the American people PAYED the price of their reckless and self serving actions. This is a PRIME example of how markets DON'T regulate themselves. It PROVES the failure of laissez-faire

You're not listening. I'm agreeing with you that backing off on regulations in the way they did, piecemeal, in response to targeted lobbying from financial interests, was the wrong approach. But that's what a regulated environment facilitates. It makes it possible for unscrupulous sorts to prey on people under the false premise that everything is 'cool' because it's legal. If, instead, buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe, they'd exercise their own caution, or they wouldn't be in business long.

You can't have a free market with a government that presumes to tell us what trades are too risky, or how much things are "really" worth. Once you start down that path, you really have to just give up on freedom altogether and submit all our economic decisions to authority. That would represent complete defeat, in my view - because I value freedom more than security - but it would at least be functional. The middle ground we're trying to traverse isn't.

I was wrong. The market responded EXACTLY and concisely as it should. It worked PERFECTLY. Buyers and sellers were free to trade under whatever terms each found acceptable, and were offered no guarantees that their trades were safe. And they LOST in the end.

BUT, they didn't just cause harm to themselves. They caused harm to all of us.

It is the PERFECT example of why your laissez-faire beliefs are not only fairy tales and faith in 'magic'. They are the MOST dangerous to a nation.

^ that

Yes. Again, you're ignoring that fact that there ARE guarantees. The entire regulated financial market is rife with them. That's WHY their failures end up costing all of us. This assumption that government is ultimately responsible for the health of the economy is the heart of the moral hazard driving all this. You will never acknowledge that because it underlines the core assumpion of your politics and shows why it is so dangerous.

You clearly don't know what you are talking about.

The ONLY MBS (mortgage backed securities) guaranteed by the government is Ginnie Mae (the Government National Mortgage Association)
Fannie Mae MBS is NOT guaranteed by the government
Freddie Mac MBS is NOT guaranteed by the government
Private label MBS is NOT guaranteed by the government.

And what happened when all these companies face bankruptcy? Who bailed them out? Are you familiar with the term 'moral hazard'? Are you thinking about this at all, or this just a partisan cheerleading contest?

I am familiar with the term 'moral hazard', and some of that applies. Especially to private mortgage securitization. But I do not believe any of the bad actors in this crisis operated with a thought that government would bail them out.

What caused the crisis and collapse:
Irresponsibly ultra-low rates that led to a huge housing boom; a failure by the Fed to supervise non-bank lenders; An abdication of lending standards by both banks and non-banks; Radical deregulation of financial markets; the now discredited belief that markets can self-regulate; a shadow derivative market allowed to operate unlike every other financial product; Compensation schemes that rewarded short term risk taking over long term profitibility; Increases in leverage to the major investment houses from 12-to-1 to 35-to-1; These were the causes of the collapse.
link

 

[EdwardBaiamonte]

What caused the crisis and collapse:
Irresponsibly ultra-low rates that led to a huge housing boom;

the perfect idiot liberal has no idea that govt regulation sets the rates!! He defeats himself every time he opens his mouth.