Brian - Regulation got us into the mortgage mess. Please spend some time reading about CRA and the impact that ACORN has had on forcing the issue. CRA, in addition to Clinton's position of removing redlining, has caused a vast majority of the mortgage problems. I know you don't like to hear that, and I know you'll also say "you got that from talk radio," but hey, it's the truth. The Dems knew it was a problem, they refused to fix it when republicans tried. That's public record. Some republicans are complicit, yet, but the majority of the problem is the refusal of the dem controlled banking committee to remove the CRA regulations and hold FM/FM to the same standards as any bank (one could argue this is increased regulation, or one could argue it's the reversal of a "special" regulation.
Listen, I'm no socialist democrat. I'd be first in line to blame Barney and Pelosi and clinton if I had half a chance. The fact is, the problems with the mortgage market can be rest at the feet of both parties. But more importantly...and you really need to understand this...the mortgage crisis is NOT the problem. It was the cataylist for a much wider, far reaching problem, in that as confidence was lost in one finacial sector, and banks began to freeze up, it had a snowball affect on the rest of the financial market, which was just as F-ed up as the mortgage market. Hence the hundreds of trillions of derivities with no backing whatsoever. What we have here is mother of all investor panics, throughout the world, across all sectors.
Trust me, this is be known by future historians as the Great Panic of 2008. And it's nowhere near over.
Paulson, Benanke should have been fired a long time ago. They are worthless, weak and incredibly stupid. Bush called for reform 17 times in the last three years, yet he supported this mess. I'm not sure where his head is at, but it's definitely not on free markets.
Reform was not possible once the bubble began. The problem got too large too quickly. The reason there was no reform is that root of the 3rd and last bubble that kept us out of the collaspe we should have gone through in the 1970s, was cheap and stupid mortgages. They were deathly afraid of housing prices collasping the moment mortgages became too hard to obtain. Once investors got spooked, as cheap mortgages were no longer enough to keep housing prices inflated and people began to default and the market closed off mortgages on its own, it was too late.
The bottom line is no matter what, we'd have ended up where we are today. It just a matter of how bad it would be in the end. The only real solution would have been to allow us to go into a major recession or depression back in the 1970s, 1990s or early 2000s. Then we could have made a fresh start under far better economic conditions with a far stronger industrial and producing economy that could have eventually worked its way out of the situation. But now the recession/depression will be forced on us, under the worst possible conditions, where our debt load far exceeds any hope of ever being repaid, which means default is now guaranteed and with an producing economy and industry that is now many times weeker. In short, the bankruptsy of the United States of American is now unavoidable. Everyone now knows it, hence the great panic of 2008.
Free markets work. Don't fall into the George Soros position that gov't must regulate more and more and more. He'd have all of the banks gov't owned if he has his way.
What needs to be regulated, if anything, is the friggen federal gov't. And we voters have done a piss-poor job of regulating anything.
Your not hearing me. There is no such thing as a true free market. What you think of as a free market, is still regulated by, at the very least, foreign governments and international government agencies, WTO, IMF, WB, etc. The only debate is whether the U.S. allows U.S. corporations and banks to operate in a completely free for all economy, in competition with banks and corporations that are supported by and regulated by foreign governments and tax bases. That's largely the directly we've been headed since the 1980s and that's a receipt for utter collaspe of the U.S. economy...oh wait...lookie where are today. <img src="/forums/images/graemlins/rolleyes.gif" alt="" />
If we could operate only within our borders, where the federal government protected cross sea and cross international border commerce and U.S. businesses acted freely within the borders of the U.S., it might be an interesting experiment. But those days are long gone.
You have two choices in this current market. You can either allow your businesses to operate in a free for all manner, where they suck off the tit of the U.S. tax payer and consumer, but operate as essential international corporations with their own soveriegnty, as we essentially have been, or you can operate an economy where the best interests of each country are looked out for by their own government. We operate in the former. Every other nation on earth, operates on the latter principles. We're the ones that are collasping first.
The bottom line is the U.S. cannot flourish in the current global economy where its wealth, power and technology are traded freely among nations who specificly look out for their own best interests first.
Quadrillians? Not that much money out there, Brian.
And now you're starting to see the root of the problem.
Start doing some reserach. As of March, 2007 the derivities market was offiically estimated at over 512 trillion dollars, according to the bank of international settlements.
Guess what? There's not 512 trillion dollars worth of money out there either. It's all debt. The quadrillion is a rough estimate by various sources of what it could be today, since the bank of international settlements hasn't taken an accounting for more than a year.
Don't feel bad, nobody believes it when they just hear it from me. It's too outragous, but once they read the official reports, they're just as shocked as I was...and just as shocked as all the investors around the world who are now panicking their behinds off.
