Re: OT: dominos continue to topple


"David R Brooks" <davebXXX@xxxxxxxxxxxx> wrote in message
news:47d30e46$0$23633$5a62ac22@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
ED wrote:
On Sat, 08 Mar 2008 10:48:36 -0600, F. George McDuffee
<gmcduffee@xxxxxxxxxxxxxxxxxxxxxx> wrote:

On Sat, 08 Mar 2008 08:56:34 -0700, ED
<albieguyspamless@xxxxxxxxx> wrote:
<snip>
Too much easy money, Greenspans book has some interesting insights.
<snip>
==========
As I continue to dig, and yet additional "stuff" floats to the
surface, it appears more and more that Greenspan/The Fed were
major collaborators/enablers in allowing, indeed even promoting,
the major banks and other financial institutions to evade the
loan reserve requirements that would have prevented the hyper
expansion of credit which is now imploding/de-leveraging.

(snippage)

IMO there are some players on the street that ripped off
the public for a few trillion bucks and are now laughing
up their collective sleeves. They were taking the toxic
waste paper and slicing it into AAA stuff and sell it off as
investment grade and at the same time taking short
positions on the same paper........they are well known
throughtout the business.

There is so much of this paper
being held off the books that if it were subject to GAAP
these banks would likely be insolvent.. Japan in the early 90's
deja vu

Greenspan warned Bush about his taxcut/spending increase
to no avail. The housing boom continued05-06 at the same time the
fed increased rates...china was feeding this thing.. ED

Imagine if I had a shed full of apples. Many are good, some are average,
& a few are plain bad. I want to sell them.
So I load them into barrels, with the bad at the bottom, then some
average, & the good at the top. I sell all the barrels as "good".
I'd be jailed, methinks.
How is this "securitisation" different?


It depends on whether there are any rules or not. If there are rules against
fraud and misrepresentation then it would be wrong, unless of course, there
wasn't anyone around to enforce the regulations. In that case anything would
go. It's sad to say but in our situation we have gone back to the days of
the 1920s when there was no regulation of business or financial markets. We
saw what the results of free market capitalism were in 1929. It seemed like
the mistakes of not regulating the markets had been corrected. However, with
the election of Bush it was as if the business community and financial
sector was told there were not going to be any cops and that the "market"
would do the regulating. Now we have the results of letting the market
regulate itself. Cheating, fraud, waste, theft, you name it and we've got
it. Just like in the 1920s. We already learned that unregulated markets will
boom and that will be followed by ruin. Too bad that the free market
utopians were able to have their way again. The country will be paying for
not controlling the business and financial markets for years. That is if we
are smart enough to do what FDR did after the last big market collapse, put
the regulations back in place and then some. We'll see if they have the
balls to do that.

Hawke


.

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