11-21-2008, 02:25 AM
Matt:
There's no doubt about it. Both parties have the blood of the American economy on their hands. There was just so much in political contributions invested in the situation. However, I do disagree that the Clinton administration's efforts to make so-called "liar's loans" (loans that don't require income verification) didn't make any difference in the current situation.
It was, indeed, the root of the problem. When so many borrowers in the subprime (read: lots of "liar's loans") market defaulted on their mortgages, the damage could have been limited to local banks, essentially like an infected blood cell. The pressure applied to Freddie and Fannie to purchase and bundle these loans took the infection to the arteries of our credit market. Our economy depends on the free flow of lending capital to grow.
There's no doubt about it. Both parties have the blood of the American economy on their hands. There was just so much in political contributions invested in the situation. However, I do disagree that the Clinton administration's efforts to make so-called "liar's loans" (loans that don't require income verification) didn't make any difference in the current situation.
It was, indeed, the root of the problem. When so many borrowers in the subprime (read: lots of "liar's loans") market defaulted on their mortgages, the damage could have been limited to local banks, essentially like an infected blood cell. The pressure applied to Freddie and Fannie to purchase and bundle these loans took the infection to the arteries of our credit market. Our economy depends on the free flow of lending capital to grow.