Re: {OT} i agree with a harvard professor

On Sep 30, 2:05 pm, SMS <scharf.ste...@xxxxxxxxxxx> wrote:
edspyhil...@xxxxxxxxx wrote:
On Sep 30, 1:10 pm, "badgolferman" <REMOVETHISbadgolfer...@xxxxxxxxx>
wrote:
Maybe this guy could be the next Secretary of the Treasury.

http://www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html?iref=....

--
"Some folks are wise and some are otherwise." ~ Tobias George Smolett

I'm with you on this.  The FDIC is forcing banks to NOT lend money.
This is manufactured.

That guy writes well, but he's got some major errors in his article.

Specifically, Fannie May and Freddie Mac were _not_ doing sub-prime
loans. They were affected by the sub-prime mess because it was the
sub-prime loans that drove down property values when the massive
foreclosures began. The Fannie May and Freddie Mac loans always required
down payments and proof of income, etc. In fact, Fannie May and Freddie
Mac were unable to compete, in terms of numbers of new loans, with the
companies issuing and trading the sub-prime loans.

Furthermore, not all banks were as stupid as WAMU in doing these stupid
loans (zero-documentation, ARMS, etc.) and are not in danger of going under.

Sometimes you see the neo-cons trying to blame Obama for his support of
Freddie Mac and Fannie May, but in fact these two lenders were never in
trouble prior to the sub-prime loans by other lenders causing a
melt-down in property values.

Still, a bailout looks less and less like a good idea. The current
lending freeze is because the banks are all waiting with baited breath
to see how much of a handout they can get, and they don't want to
jeopardize it by continuing to lend at this time.

It's time to weather the bankruptcies of a few major banks, shore up the
FDIC so depositers don't lose anything, but wipe out the shareholders of
these banks. Few employees, other than the executives, will end up
losing their jobs. There will be some job loss with or without a bailout.

It is now accepted knowledge that 75% of the sub-prime loans are
performing and being repaid.
.

Relevant Pages

  • Re: {OT} i agree with a harvard professor
    ... They were affected by the sub-prime mess because it was the sub-prime loans that drove down property values when the massive foreclosures began. ... The Fannie May and Freddie Mac loans always required down payments and proof of income, ... The current lending freeze is because the banks are all waiting with baited breath to see how much of a handout they can get, and they don't want to jeopardize it by continuing to lend at this time. ...
    (alt.autos.toyota)
  • Re: Rebutting canard that liberals caused the credit crisis
    ... responsible for the sub-prime crisis is a bald faced liar. ... making sub-prime loans, and you set up Freddie and Fannie as ... Banks were happy to make those crap loans as long as they ...
    (soc.retirement)
  • Re: Rebutting canard that liberals caused the credit crisis
    ... responsible for the sub-prime crisis is a bald faced liar. ... making sub-prime loans, and you set up Freddie and Fannie as ... Banks were happy to make those crap loans as long as they ...
    (soc.retirement)
  • Re: Rebutting canard that liberals caused the credit crisis
    ... responsible for the sub-prime crisis is a bald faced liar. ... making sub-prime loans, and you set up Freddie and Fannie as ... Banks were happy to make those crap loans as long as they ...
    (soc.retirement)
  • Re: It Really Is Clinton III
    ... it wasn't the CRA or the sub-prime loans that did this ... It was the stupid actions of the banks and investment houses ... That was the intent, but what it produced was Equal Opportunity Lending, regardless of the ability to repay, race, religion or gender and it encompasses everybody. ... You say sub-prime loans didn't do the economy in, but acknowledge it was the stupid actions of banks and investment houses in their dealings with sub-prime loans. ...
    (rec.boats)