On Sep 16, 11:38 am, Dave wrote:
On Tue, 16 Sep 2008 11:26:06 -0700 (PDT), "
said:

Rules that were put in place in the last
great consumer credit crunch have been loosened all around to maintain
liquidity

What rules were those?

Rules like my rule against posting off topic! My apologies to the
group and I'll let you have the last word, Dave. My thesis is that
banking deregulation, securities deregulation and insurance
deregulation have been driven by the need to expand consumer credit.
Many of those regulations that were loosened were legacies of the
Great Depression and included collateralization requirements for banks
and insurers, strict separation banking and securities services and
book keeping among others. Gory detail is available to a Google user
and there's some general discussion he http://en.wikipedia.org/wiki/Deregulation.

-- Tom.

Wayne.B wrote:
On 16 Sep 2008 10:30:05 -0500, Dave wrote:

*Someone* dreamed up this sub-prime crap, and with some forensic
accountancy, they can be found, but it won't be done because it will
tread on too many toes.

Sub-prime was dreamed up because there was only just so much
legitimate mortgage debt to go around. The whole business of
packaging debt and then selling/securitizing it via bonds was highly
profitable while the fun lasted. Even more profitable was borrowing
money at very low interest rates and using the funds to buy high yield
bonds. The profits were limited only by your ability to borrow and
the availability of high yield investments. Sub-prime was invented to
meet that demand. It was clear to me 5 years ago that the bond
holders would eventually be left holding the bag just like the Savings
and Loan industry was caught out back in the 80s. What wasn't clear
to me was that the financial industry had drunk a lot of their own
toxic Kool Aid and would end up being the ultimate bag holders.


For years people have been whining that they couldn't buy houses
because they didn't have good enough jobs, if they had jobs at all. So
credit requirements were loosened and loosened by our illustrious
govmint so ALL could buy houses. So much for socialism.
Gordon

On Tue, 16 Sep 2008 16:00:44 -0700, Gordon wrote:

For years people have been whining that they couldn't buy houses
because they didn't have good enough jobs, if they had jobs at all. So
credit requirements were loosened and loosened by our illustrious
govmint so ALL could buy houses. So much for socialism.

The government does not set credit standards for lending, at least not
in the US.

"Dave" wrote in message
...
On Tue, 16 Sep 2008 16:00:44 -0700, Gordon said:

So
credit requirements were loosened and loosened by our illustrious
govmint so ALL could buy houses. So much for socialism.

Give the man an E for effort. The gummint doesn't set credit requirements
for mortgagors, Gordon. Mortgage lenders and those to whom they sell the
mortgages set those requirements.


Therefore, according to Dave, we should remove even more regulation! I get
it!

--
"j" ganz @@
www.sailnow.com