Government usually is the problem

[Dari]

I've been in the private sector working in banking for a couple of years now. When the financial crisis hit I was finishing up grad school. What a difference a couple of years make. I now see that the cause of the financial crisis was not bankers but government. For decades they made it easy for people to buy homes they could not afford (buying a house is one of the main tenets of the American Dream). They also made it easy for regulators and bankers to facilitate this policy. Then when the crisis hit the banking community was made the scapegoat. Then, in order to save the financial system, government forced (yes, they actually told the companies) to merge or buy each other out. Of course, you could say no but then you'd have much bigger problems. One example of this was Bank of America buying Countrywide and, later, Merrill Lynch. It never made sense then but it was forced on them by the Treasury. Fast forward a couple of years later and another arm of the government, the DoJ, sues Bank of America for all the toxic and "questionable" loans Countrywide made. BoA had to settle. Where did that money go? The Treasury, of course. There are countless other examples related to the financial crisis. So, it's easy to blame bankers and use them as the fall guy but they did not create the financial crisis. People often ask why no bankers have gone to jail because of the financial crisis. This is your answer. Uncle Sam was 100% at fault.

A more recent, and pedestrian example, is the new type of cab companies trying to enter the taxi business. Why is it so tough? At least, in NYC, the barrier to entry is high because of government. They sell medallions that cost millions of dollars in order to get into the business. It's an artificial barrier that does not need to exist. But it exists and, hence, 2 families dominate this business. So the government is fighting startups in order to maintain a corrupt status quo that never should've existed in the first place. But when you look at the arguments, it's usually between the small fries against the startups while the government acts as judge, jury, and executioner (with a heavy bias, as previously mentioned).

 

[theeedude]

Please post link to relevant legislation and where it required banks to issue no money down loans to people with no income and no job.

 

[IronWing]

Self serving claptrap is transparent.

 

[SlickSnake]

Please post link to relevant legislation and where it required banks to issue no money down loans to people with no income and no job.

I may be wrong, but weren't those home loans handed out to people receiving benefits of some sort? Like disability or something like that? So they had income, just not very much of it.

 

[Dari]

Please post link to relevant legislation and where it required banks to issue no money down loans to people with no income and no job.

We're not Communist China. The banks are not required to issue loans. However, when you have multiple federal agencies dedicated to making home ownership easy, no bank will refuse easy money. Even after the financial crisis, government still has not learned its lesson:

https://www.congress.gov/bill/113th-congress/house-bill/3529

Point is, government made it extremely easy for people to take out loans and then turned around and blamed banks when they exploited the government's underwriting facilities.

Self serving claptrap is transparent.

How is it self-serving? My point is that academia and the real world are very different. Those in their ivory towers see things from a theoretical POV. In the real world, it's a lot messier.

 

[ivwshane]

We're not Communist China. The banks are not required to issue loans. However, when you have multiple federal agencies dedicated to making home ownership easy, no bank will refuse easy money. Even after the financial crisis, government still has not learned its lesson:

https://www.congress.gov/bill/113th-congress/house-bill/3529

Point is, government made it extremely easy for people to take out loans and then turned around and blamed banks when they exploited the government's underwriting facilities.



How is it self-serving? My point is that academia and the real world are very different. Those in their ivory towers see things from a theoretical POV. In the real world, it's a lot messier.

Lol! It's not the banks fault! The money was too easy to get to not pass up and to use restraint and normal business practices when giving out loans!

/S

You are fucking retarded and I hope you never touch my money!

More of the same old same old, blame the victim tripe! Her skirt was so short! How could anyone NOT rape her!

Congrats on your ascendance to douchery! Your wall street buddies will be proud!

 

[ivwshane]

Please post link to relevant legislation and where it required banks to issue no money down loans to people with no income and no job.

You'll notice he didn't answer your request and he has repeated his claim.

 

[Bowfinger]

How is it self-serving? My point is that academia and the real world are very different. Those in their ivory towers see things from a theoretical POV. In the real world, it's a lot messier.

What you said was, "Uncle Sam is 100% at fault." Claptrap.

The anti-government crowd, typically the right, can always find a way to cry it's all Uncle Sam's fault. If the government establishes effective regulation, it's called an undue burden that kills business and hurts the economy. Let the free market decide, is their mantra. If the government relaxes regulation, however, it is again the government's fault for not preventing corporations from doing whatever bad thing happened. Typical confirmation bias.

The real point is that so many banks chose to offer predatory loans because they were quite profitable. A few banks remained responsible, but the big boys lined up at the trough and gorged at Americans' expense. That is the vaunted "free market" at work when the government does not reign in its abuses. Greed wins.

 

[ivwshane]

I especially like how the OP blames the government for making loans too easy to get while absolving business's from any wrong doing which basically means that the fix is a government one since businesses can't help themselves.

He must of got one of those online educations😛

 

[DucatiMonster696]

I've been in the private sector working in banking for a couple of years now. When the financial crisis hit I was finishing up grad school. What a difference a couple of years make. I now see that the cause of the financial crisis was not bankers but government. For decades they made it easy for people to buy homes they could not afford (buying a house is one of the main tenets of the American Dream). They also made it easy for regulators and bankers to facilitate this policy. Then when the crisis hit the banking community was made the scapegoat. Then, in order to save the financial system, government forced (yes, they actually told the companies) to merge or buy each other out. Of course, you could say no but then you'd have much bigger problems. One example of this was Bank of America buying Countrywide and, later, Merrill Lynch. It never made sense then but it was forced on them by the Treasury. Fast forward a couple of years later and another arm of the government, the DoJ, sues Bank of America for all the toxic and "questionable" loans Countrywide made. BoA had to settle. Where did that money go? The Treasury, of course. There are countless other examples related to the financial crisis. So, it's easy to blame bankers and use them as the fall guy but they did not create the financial crisis. People often ask why no bankers have gone to jail because of the financial crisis. This is your answer. Uncle Sam was 100% at fault.

A more recent, and pedestrian example, is the new type of cab companies trying to enter the taxi business. Why is it so tough? At least, in NYC, the barrier to entry is high because of government. They sell medallions that cost millions of dollars in order to get into the business. It's an artificial barrier that does not need to exist. But it exists and, hence, 2 families dominate this business. So the government is fighting startups in order to maintain a corrupt status quo that never should've existed in the first place. But when you look at the arguments, it's usually between the small fries against the startups while the government acts as judge, jury, and executioner (with a heavy bias, as previously mentioned).

Agreed.

Uber, Lyft, Rideshare, etc are all giving cab companies in SF a run for their money. Of course these cab companies are lobbying hard to get local SF government to "crack down" on these startups. Why? Because prior to these start-ups moving in on their turf they literally had a government backed monopoly, enforced by heavy regulations that prevented competition and allowed a cartel to form that worked to keep prices up and didn't really care to much about the service being provided. Now that stranglehold is being threatened by changes in technology and a shifting business model offered by startups and you'd think it was the end of the world and that some devious plot by these evil "tech companies". In case you didn't know tech companies are being actively vilified in SF because they are "too successful" and because they pay their workers too well, how ironic.

 

[DucatiMonster696]

I especially like how the OP blames the government for making loans too easy to get while absolving business's from any wrong doing which basically means that the fix is a government one since businesses can't help themselves.

He must of got one of those online educations😛

He's not blaming government for directly making bad loans. He's blaming government (however the Fed should also be blamed as well) for providing an environment in which not making bad loans meant you weren't taking advantage the business environment setup and manipulated by government (and its ally in the matter the Fed), in the first place. That is a very subtle but critical difference in that argument.

 

[ivwshane]

He's not blaming government for directly making bad loans. He's blaming government (however the Fed should also be blamed as well) for providing an environment in which not making bad loans meant you weren't taking advantage the business environment setup and manipulated by government (and its ally in the matter the Fed), in the first place. That is a very subtle but critical difference in that argument.

No I get the difference, women are allowed to wear revealing clothes, therefore women should expect to be raped.

If business can't keep itself from raping then obviously more government is the solution. The problem isn't with women, that is the government, the problem is with the rapist, that is, the problem is with businesses who rape.

 

[dmcowen674]

Please post link to relevant legislation and where it required banks to issue no money down loans to people with no income and no job.

He won't and he can't. Just the typical Rich Republican bullshit line.

 

[theeedude]

We're not Communist China. The banks are not required to issue loans. However, when you have multiple federal agencies dedicated to making home ownership easy, no bank will refuse easy money. Even after the financial crisis, government still has not learned its lesson:

https://www.congress.gov/bill/113th-congress/house-bill/3529

Point is, government made it extremely easy for people to take out loans and then turned around and blamed banks when they exploited the government's underwriting facilities.



How is it self-serving? My point is that academia and the real world are very different. Those in their ivory towers see things from a theoretical POV. In the real world, it's a lot messier.

Corporations are people, my friend. If banks are doing something immoral to make money, they should be held to same standard as people who are doing something immoral to make money, not excused from responsibility by shifting the blame to the government. So I am glad the government sued them, and I am glad the government took billions of dollars from them and put those dollars into the treasury.

 

[Dari]

Corporations are people, my friend. If banks are doing something immoral to make money, they should be held to same standard as people who are doing something immoral to make money, not excused from responsibility by shifting the blame to the government. So I am glad the government sued them, and I am glad the government took billions of dollars from them and put those dollars into the treasury.

The rape analogy is so stupid I feel it's just an easy moral exit strategy for people who have no rational response to what's in the OP. Corporations exist to make money for their owners. They are bound by the law. That's it. Not maximizing their profit means they are doing a disservice to their owners. It is the government's responsibility to bring about sensible laws for everyone, not crap that'll keep politicians in office. This is exactly what happened with those in power. They passed stupid laws that skewed the supply and demand of the housing market and acted surprised when havoc ensued, only to blame bankers (but not themselves or those trying to buy mansions on a janitor's salary).

I'm glad you find it ok for the Treasury to order BoA to buy Countrywide then turn around and sue BoA for all the things Countrywide did (before they bought them). Nah, you have no agenda here. Just looking out for the little guy🙄

 

[Dari]

For those still confused or hostile to the OP, understand this. My main point is that government should be in the governance for the well-being of everyone for the long-term. Making bad laws for votes and putting expenses on credit is bad governance. It's time for people to stop blaming 1% and use some introspection to realize that the problem lies in who we're putting in power. Those who are only interested in short-term solutions are just as dangerous as any external enemy.

 

[Mr. Pedantic]

So basically you're saying that corporations as a whole, and banks as a specific case, are like puppies - we should look adoringly and indulgently on their wanton destruction of our own and others' property, because they have no willpower to resist an easy treat regardless of the consequences, because they don't know any better and because it's ultimately other people's fault for bringing them up with no boundaries or discipline?

Yeah. Ok. Whatever

 

[Veliko]

For those still confused or hostile to the OP, understand this. My main point is that government should be in the governance for the well-being of everyone for the long-term. Making bad laws for votes and putting expenses on credit is bad governance. It's time for people to stop blaming 1% and use some introspection to realize that the problem lies in who we're putting in power. Those who are only interested in short-term solutions are just as dangerous as any external enemy.

Unfortunately that 1% like to indulge in lobbying and cocaine breakfasts in order to influence those we put in power.

Look at who is bank rolling the Tea Party for instance.

 

[ivwshane]

The rape analogy is so stupid I feel it's just an easy moral exit strategy for people who have no rational response to what's in the OP. Corporations exist to make money for their owners. They are bound by the law. That's it. Not maximizing their profit means they are doing a disservice to their owners. It is the government's responsibility to bring about sensible laws for everyone, not crap that'll keep politicians in office. This is exactly what happened with those in power. They passed stupid laws that skewed the supply and demand of the housing market and acted surprised when havoc ensued, only to blame bankers (but not themselves or those trying to buy mansions on a janitor's salary).

I'm glad you find it ok for the Treasury to order BoA to buy Countrywide then turn around and sue BoA for all the things Countrywide did (before they bought them). Nah, you have no agenda here. Just looking out for the little guy🙄

False and utter bullshit! There is no law that says businesses have to maximize profit. The law states that the business's goal is to help the company prosper, that encompasses a whole slew of things including profits and things that might minimize profit.

 

[ivwshane]

For those still confused or hostile to the OP, understand this. My main point is that government should be in the governance for the well-being of everyone for the long-term. Making bad laws for votes and putting expenses on credit is bad governance. It's time for people to stop blaming 1% and use some introspection to realize that the problem lies in who we're putting in power. Those who are only interested in short-term solutions are just as dangerous as any external enemy.

No that wasn't your main point, if it was I would have agreed with you.

 

[cubby1223]

False and utter bullshit! There is no law that says businesses have to maximize profit. The law states that the business's goal is to help the company prosper, that encompasses a whole slew of things including profits and things that might minimize profit.

Except... that's not what he said. You've been abnormally pissy this past week. Is there something you'd like to share with the forum? Other than the increased intensity and frequency of anger?


To the subject of this thread, some friends of mine do consulting work to put banks in compliance with government regulations...

I'm not going to get into an argument of who's at fault, who caused what... I'll just say, most here who brag they know everything, have such little understanding of the enormity of the confusing clusterfucks regulations create behind the scenes trying to understand and become compliant with.

 

[OverVolt]

Lots of convoluted shit went down in 2008. BAC wasn't even the half of it. My god AIG.

http://www.nytimes.com/2014/09/29/opinion/finally-the-truth-about-the-bailout.html?_r=0

I'm sure the housing crisis began with the whole "A home for every American" George W Bush style.

Before you knew it you could get a $1,000,000.00 loan with no income, job or assets. Yup.

 

[ivwshane]

Except... that's not what he said. You've been abnormally pissy this past week. Is there something you'd like to share with the forum? Other than the increased intensity and frequency of anger?


To the subject of this thread, some friends of mine do consulting work to put banks in compliance with government regulations...

I'm not going to get into an argument of who's at fault, who caused what... I'll just say, most here who brag they know everything, have such little understanding of the enormity of the confusing clusterfucks regulations create behind the scenes trying to understand and become compliant with.

Actually that's exactly what he said:

Corporations exist to make money for their owners. They are bound by the law. That's it

 

[OverVolt]

..

 

[Dari]

Actually that's exactly what he said:

No it isn't. What I said, to paraphrase myself, is that legal/regulatory constraints are the only boundaries that companies cannot cross. Everything else is fair game in order to maximize profit for owners, including crossing moral/ethical lines. Therefore, some corporations can put some of their profit into research and development, marketing, or other avenues to help the companies grow. Others can give 100% of profits as dividends.

You're claiming that I said that some law out there is telling corporations that they have to maximize profit, which is absurd.

Maybe using "bound" instead of "bounded" confused you?