The government forced these banks to offer bad loans

[Seacrest]

Maybe someday soon Sean Hannity will understand high finance as well as this other right wing hack.
Anyone?

[maco]

Oh and they must have forced wall street to issue all of those crazy derivatives.

[Seacrest]

maco wrote:
Oh and they must have forced wall street to issue all of those crazy derivatives.

Not to mention pre-approved Platinum Visa cards to household pets.

[anonymouse1]

Okay, the CRA loans were at most 25% of the subprime loans, and they have been among the best performing loans--they've only defaulted at about the same rate as non-subprime loans.

Hannity is an a$$. And a misleading one.

[guitarist]

Too bad your only exposure to this was this particular source. It's not exactly news that there was pressure to make housing affordable to people who normally can't afford it, and while this didn't cause the bubble, but it played a fundamental role in the explosion of bad paper.

"in 1992, Congress passed the Government Sponsored Enterprises bill, which set “targets” (i.e., quotas) for Fannie Mae and Freddie Mac, which are quasi-governmental publicly-traded for-profit thing-a-ma-bobs, to encourage “affordable” and “underserved” (more or less minority) home loans."

A good idea in theory, to extend the dream of home ownership to more Americans, and particularly, more minorities, lower-income Americans, but banks aren't well-suited to applying progressive social programs. How creditworthiness is defined was altered to meet egalitarian ideals.

It's an unpopular issue to confront, because it reveals uncomfortable things about racial and social inequities.

This is also a conservative source, but it's more credible and statistically referenced than Sean's simplistic view.

http://www.takimag.com/site/article/the_...e_housing/

[Acer]

You know, I was thinking, "$700 Billion is a heck of a lot of defaulted low-to-moderate income loans," but then he served this really tasty koolaid...

[$tevie]

Wow, that article blames Blacks, Hispanics, diversity initiatives, quotas, the Sixties cultural revolution -- so many of the favorite neocon bugaboos. I bet it is killing the author that he couldn't figure out how to blame homosexuals, too.

[Gutenberg]

I don't think I would take Taki Theodoracopulos seriously on any subject having to do with race, creed, color or national origin. He's famously bigoted.

[Seacrest]

Most analysis of how we came to this point from either the extreme right or the extreme left is way off the mark.

If you really want to know what happened (and what will happen), there are a few excellent books out there you can read. There are also some really great examples of what the kids call "blogs" that have been covering all this way more in-depth than the so-called MSM, what the youth call your daddy's media -- TV, radio, newspapers.

One book in particular is Charles Morris's "Trillion Dollar Meltdown."
It takes a fairly dispassionate look at the whole history of both financial markets and political movements and how the two intertwine. I read this book in a weekend. I found it so fascinating I couldn't put it down.

Other books I have not read, but you might want to check out include Bill Fleckenstein's "Greenspan's Bubbles" and Kevin Philips' "Bad Money."

Some of the blogs that do a good job of reporting on this include Calculated Risk, Seeking Alpha, the Big Picture, and Mish. CR is my favorite. There's a lot of attitude from the [anonymous] blogging duo (esp 'Tanta'), and the commenters are really well-informed and often very witty.

I also check in with Bloomberg daily and stay away from the other cable TV shills.

One person, particularly, has been on point throughout all of this mess, and that is Prof. Nouriel Roubini of NYU. Also, Peter Schiff, Robert Schiller, Paul Krugman and, yes, Ron Paul.

[guitarist]

I didn't realize credit was a "civil right".

That's just one side of it. Probably a more significant contributor to this disaster began with the Republican-led repeal of the Glass-Steagall Act.

To what degree this is to blame for the abuses depends on who you ask. But targeting this is less uncomfortable, liberals will approve, we can say it blames only white people.

http://en.wikipedia.org/wiki/Glass-Steagall_Act