"bpuharic" wrote in message
...
On Sat, 28 Aug 2010 11:43:47 -0400, wrote:

On Sat, 28 Aug 2010 09:20:51 -0400, bpuharic wrote:

the right wing wants us to believe lazy middle class workers are
behind the collapse of the housing market.


http://www.propublica.org/article/ba...nancial-crisis

As the housing boom began to slow in mid-2006, investors became
skittish about the riskier parts of those investments. So the banks
created -- and ultimately provided most of the money for -- new CDOs.
Those new CDOs bought the hard-to-sell pieces of the original CDOs.
The result was a daisy chain [1] that solved one problem but created
another: Each new CDO had its own risky pieces. Banks created yet
other CDOs to buy those.

---------------

the right wing, believing that rich people are next to god, won't
believe this. but the objective facts show that it was WALL STREET,
NOT MAIN STREET that trashed this economy

Without creative ways of printing money the housing boom would have
stalled in 2000 and the dot com crash recession would have continued.

the dot com crash was peanuts compared to the bush depression.


Nobody was complaining when the unemployment rate was close to zero

because no one knew how much wall street was stealing.

AND...what you fail to mention is that even when unemployment was
zero...middle class wages were stagnant. the middle class survived by
borrowing while wall street

STOLE THE FREAKIN' ECONOMY!

and people were not paying attention to where the money was coming
from. There was plenty of greed to go around. What about those yuppies
house flippers who were borrowing 99% of the home price, hoping they
would never have to make a payment or the ones with the 125% home
equity loans?
There were some people who knew this was going to crash. The smart
builders were scaling back in 2006.

well golly. if people were so smart why are we in the condition we're
in?

Because they were happy the Bush administration was causing another bubble
to hide the last crash. CDO's did not cause the crash. Government telling
the banks to loan money to people that had no chance in hell of making the
payments. And Fannie and Freddy buying the worthless paper. since you
could buy a house with no down, less than cost payments and hope the price
escalated before you had to pay and could cash out big time. 3% or the CPI
was the historical escalation of home prices. Not 15-20% a year. People
making $50k a year buying a house that was 10-20 times their annual income
was the cause of the crash, Wall Street just cashed in on the boom. And
they would not have been able to do it with such vigor if Clinton and Rubin
had not pimped for the removal of Glass-Stegall and then signed the law.