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![]() "Dave" wrote in message ... On Tue, 07 Oct 2008 21:12:21 -0700, Stephen Trapani said: Basically Fannie and Freddie regulations created a false market which was then not subjected to enough oversight and hence abused. Fannie, Freddie and CRA were certainly all contributing factors to the problem. However in the case of Fannie and Freddie the problem arguably was as much a problem of too much oversight of the wrong kind, not too little oversight. Long after the risks had been identified (as far back at least as 2001) you had Barney Frank and Jim Shumer standing on the sidelines cheering both GSEs to buy more and more mortgages so more and more homes could be sold to people who couldn't afford the mortgages, and loudly proclaiming that there was nothing wrong with either GSE. Their protection racket was of course funded by generous contributions from Fan and Fred. Anybody know who the biggest recipients of Fan and Fred's largesse were? Hint: number two chose a former President of one of the organizations to run his vice presidential selection. Why is it people so conveniently have forgotten the root cause of the sub-prime lending fiasco which root cause is energy prices through the roof. For two years the world has been shelling out twice too much for it's energy needs. Americans will continue to put gasoline and diesel in their automobiles and trucks and come the end of the month, lo and behold, there ain't no cash left to pay the mortgage. None left to pay the other bills either - so they charge up the credit cards and end up having even less with which to pay the rent. So they default on their obligations. Fannie and Freddie were the first to feel the effects and now it's permeating the entire economy. But, it was and is the high cost of energy that's at fault for the mess the whole world is in. Ask yourself why the whole world is feeling the same pinch we are in the USA. It's because the whole world is paying the same rip-off energy prices. And why is gasoline still $3.50 to $3.75 per gallon when a barrel of oil has gone from $150 to less than 90 bucks? Logic dictates a gallon of gasoline should be around $2.75 per gallon. It is this continued high cost of energy that has driven up the prices of groceries and other consumer items. All these inflated prices have taken too big a chunk out of the consumers wallet. The mortgage is where the buck seems to have stopped. Not enough left in the purse to shell out that large sum of money. Why is nobody but me aware this obvious root cause? Wilbur Hubbard |
#2
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"Dave" wrote in message
... On Wed, 8 Oct 2008 11:53:34 -0400, "Wilbur Hubbard" said: Why is nobody but me aware this obvious root cause? Everyone else recognizes that you're full of ****, Neal. That's a gross generalization. Neal recognizes this, but he's unwilling to admit it. LOL -- "j" ganz @@ www.sailnow.com |
#3
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![]() "Dave" wrote in message ... On Wed, 8 Oct 2008 11:53:34 -0400, "Wilbur Hubbard" said: Why is nobody but me aware this obvious root cause? Everyone else recognizes that you're full of ****, Neal. At least the Good Captain isn't the typical, brainwashed American like you, Dave. There is a reason why there's no attribution of blame in the right place for the current severe downturn in the economy. Sub prime lending is getting the blame but there is a reason why sub prime loans stopped being paid down recently. That reason is severely reduced ability to pay because life got really expensive for the consumer in the past two years due to high energy prices. When people, in a relatively short time frame, have to pay double for their energy that money spent limits their ability to spend it on such things as paying down mortgages. Cheap energy greases the economic engine of this economy. When energy becomes excessively expensive (as in twice as expensive) the economic engine sputters to a halt. Expensive energy is the root cause of the dire straights the economy finds itself in. It was only a matter of time and time has now run out. Unless and until Congress gets their heads straight and gets out of the way so energy sources of all types can be developed by the free market until energy prices are once more reasonable the mess we are in will continue. Wilbur Hubbard |
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