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Phil Robertson and freedom to have an opinion

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LegendKiller

Lifer
Mar 5, 2001
18,261
68
86
CRA, keeping derivatives unregulated and many other political factors contributed to the housing bubble. I'm not saying it was entirely their fault...my point is that there's lots of blame to go around.

http://en.wikipedia.org/wiki/Causes_of_the_United_States_housing_bubble

Edit: Damn I'm way off-topic! Sorry about that!
Blaming CRA is a joke - it wasn't a meaningful amount of mortgages.

This wasn't just a political thing but I would attribute a lot of it to that.
 

zinfamous

No Lifer
Jul 12, 2006
102,056
16,286
136
Exactly, little risk...if property values increase forever. It's the old Buffet saying; you never know who's swimming naked until the tide goes out.

Having not been intimately involved in the immediate 04-07 runup to the craziness, I honestly wonder how these guys thought it could last. Generally, my sense is 1. they didn't care because they were getting theirs and getting out before it all collapsed on its own footprint and 2. many just didn't know or care to know or were informed enough to know because these instruments are so complicated in a sense.
the essence of a bubble. No one is ever certain that it is a bubble until it bursts. Plenty of well-intentioned and intelligent people can suspect that it's a bubble, even realize the potential for very bad investments, but there is nothing but punishment for not getting involved when profits are booming like that.
 

Vic

Elite Member
Jun 12, 2001
47,261
7,031
126
Nor was there a whole lot of originator due diligence, or mortgage broker due diligence, or home owner due diligence. The whole chain was fucked. To blame it on WS is only mortgage brokers/bankers passing the buck on their own shitty practices.
Fair enough. :D

If you want the truth, I personally put the largest portion of the blame on the borrowers and their realtors, but it's not good business practice to fault your customers, right?
 

First

Lifer
Jun 3, 2002
10,530
271
136
Nah, they were just making hay while the sun shined, as the saying goes.
If your competitors can lower their lending standards AND still sell them, it forces you to do the same to stay in business.
Remember that the customers demanded these loans they couldn't afford. Lenders who ignored these demands out of principle quickly found themselves without customers.
I'm not too sure about that, though I don't know the exact percentages, but I'd say it's quite clear there were indeed smaller and lesser known banks that survived without making those MBS loans. You could still make money safely during the boom.

Fair enough. :D

If you want the truth, I personally put the largest portion of the blame on the borrowers and their realtors, but it's not good business practice to fault your customers, right?
I can't blame borrowers too much, as most barely know what escrow means, let alone what junior tranches of a security are and what they do. Granted, borrowers are culpable for the documents they sign, but there is plenty of legal precedent saying that, in a lot of ways, borrowers really aren't as culpable as you'd think. Which I think is good for consumers generally because you shouldn't need to be very well informed about every contract you sign, that's why you hire middlemen or brokers (haha).
 
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LegendKiller

Lifer
Mar 5, 2001
18,261
68
86
I'm not too sure about that, though I don't know the exact percentages, but I'd say it's quite clear there were indeed smaller and lesser known banks that survived without making those MBS loans. You could still make money safely during the boom.



I can't blame borrowers too much, as most barely know what escrow means, let alone what junior tranches of a security are and what they do. Granted, borrowers are culpable for the documents they sign, but there is plenty of legal precedent saying that, in a lot of ways, borrowers really aren't as culpable as you'd think. Which I think is good for consumers generally because you shouldn't need to be very well informed about every contract you sign, that's why you hire middlemen or brokers (haha).
I blame the borrowers that bought into the "get rich quick" scheme. I blame the borrowers who knew their ARMs were not affordable at their higher interest rate. I blame the borrowers who knew they were not truthful with their income, or couldn't afford anything but the negative amortization. The only borrowers I do not blame are those who took out a 30-year fixed rate mortgage with the intention to stay in their house as a home (not investment) but lost their job and couldn't afford it while they looked for another.

It is not difficult to do the math behind your monthly finances. You cannot put all of the blame on others, this is not a nanny state.
 

werepossum

Elite Member
Jul 10, 2006
29,876
460
126
Nor was there a whole lot of originator due diligence, or mortgage broker due diligence, or home owner due diligence. The whole chain was fucked. To blame it on WS is only mortgage brokers/bankers passing the buck on their own shitty practices.
Spot-on. This was a perfect storm and we're all to blame. Congress, for setting the GSEs' disadvantaged borrower mandates impossibly high. The GSEs, for discarding sensible metrics such as income, credit history, and even employment as "outdated metrics" in pursuit of those goals. Mortgage bankers, for expanding those practices far beyond the GSEs' ability to buy. Appraisers, for colluding with mortgage companies to inflate actual home values. Borrowers, for taking out over-priced loans they could not afford. Wall Street, for buying near-worthless mortgage-backed securities without due diligence because there was a lot of money to be made. The Executive Branch, for laxly enforcing existing regulations while everyone was making a lot of money. Probably many others I can't bring to mind off the cuff. Good intentions coupled with foolishness and multiplied by goold old-fashioned human greed. And then Congress again, for demolishing the last sad tatters of Glass-Steagall and thereby ensuring that a crash in home mortgages did exactly what Glass-Steagall was designed to prevent, taking down the whole economy. To point out any one factor is to give cover to all the others. This is OUR failure - both parties AND non-political - for just as a prospective homeowner is responsible for making his budget, so are citizens responsible for making their laws.

I'm not too sure about that, though I don't know the exact percentages, but I'd say it's quite clear there were indeed smaller and lesser known banks that survived without making those MBS loans. You could still make money safely during the boom.

I can't blame borrowers too much, as most barely know what escrow means, let alone what junior tranches of a security are and what they do. Granted, borrowers are culpable for the documents they sign, but there is plenty of legal precedent saying that, in a lot of ways, borrowers really aren't as culpable as you'd think. Which I think is good for consumers generally because you shouldn't need to be very well informed about every contract you sign, that's why you hire middlemen or brokers (haha).
Both banks and brokers who avoided this scam made decent returns, but could not avoid damage from the recession that followed.

I blame the borrowers that bought into the "get rich quick" scheme. I blame the borrowers who knew their ARMs were not affordable at their higher interest rate. I blame the borrowers who knew they were not truthful with their income, or couldn't afford anything but the negative amortization. The only borrowers I do not blame are those who took out a 30-year fixed rate mortgage with the intention to stay in their house as a home (not investment) but lost their job and couldn't afford it while they looked for another.

It is not difficult to do the math behind your monthly finances. You cannot put all of the blame on others, this is not a nanny state.
Also spot-on. A lot of good people did everything reasonably right, yet still got devastated. Conversely, people who signed contracts they just did not understand or which they could not fulfill but with the hope that "something" would happen to save them when the ARM adjusted or the balloon note came due bear a lot of blame.
 

Matt1970

Lifer
Mar 19, 2007
12,321
2
0
Quote:
Originally Posted by shadow9d9
You DO realize that you are using a video from a program that had a Japanese, Russian, and black woman on the bridge of a starship during the cold war, right? It had ghe first interracial kiss on tv and one of, if not the first, lesbian kisses. It was about how the world eventually united, became communist, and was about exploring and accepting the unknown...It is about everything that you are against. The Ferengi are the closest to current day humans and were designed to be so.
.

Oh you are so going to have to back up calling me a racist. It's one thing you having the delusions that there is no Left in the US and the media is controlled by the right, but calling me a racist is something else. Link to one racist thing I have ever said on this forum.
I am waiting......
 

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