Housing Boom and Bust. The same discredited assumptions and the same disregard of repercussions.

[PatsFan1283]

I was gonna say 620 is too low but if you can prove it that your low score was due to the recession and you are back on your feet, good income, low oustanding debt then I think it is OK.

A lot of people got shitty credit that is more reflective of their situation 3-4 years ago then their situation now. If they can prove that then give em a loan I guess.

Like I said I don't think it is great but if they are really going to adhere to those standards then it is better than most of the something for nothing crap you see.

If those loans going to the avg person with a 620 then yeah it is fucked. Avg person with a 620 is financially illiterate.

 

[JDeuce]

You should go back in hiding. This is embarrassing.

You're right, it's totally embarrassing. The only thing I can think of that's more embarrassing is someone swearing they are going to quit posting here multiple times, yet they repeatedly keep coming back.

All I did was list what you wrote in this thread. Your ideas, not mine.

You're not only an idiot, you're a weird idiot.

 

[SheriffJoe]

I was gonna say 620 is too low but if you can prove it that your low score was due to the recession and you are back on your feet, good income, low oustanding debt then I think it is OK.

A lot of people got shitty credit that is more reflective of their situation 3-4 years ago then their situation now. If they can prove that then give em a loan I guess.

Like I said I don't think it is great but if they are really going to adhere to those standards then it is better than most of the something for nothing crap you see.

If those loans going to the avg person with a 620 then yeah it is fucked. Avg person with a 620 is financially illiterate.

I'm not sure any banking institution would lower their standards to that level risking their own capital, imo.

The larger point is this: govt distorts the market with this type of social engineering, the market reacts rationally (reckless 'greed' is rational when someone else is assuming the risk), thus creating these type of market distortions and bubbles.

When the shit inevitably hits the fan, the Paul Krugmans and aaaktard's other pseudo-intellectuals libtards with not even a toe planted in the real world blame the "greedy ass private sector"

 

[PatsFan1283]

Lastly I'm not done with the blame either.

I'd like to blame the 3rd part in this equation. The consumer...

Paying 400k for a house in the middle of the desert with subpar building material and a loan that is going to reset in 3 years is a really bad move. Betting on Ryan Lindley is a better idea than this. Cmon man!

 

[SheriffJoe]

Does the consumer create these moral hazards?

 

[PatsFan1283]

No but they can't be absolved from responsibility. Ultimately you make your own decisions.

Just because someone is telling you that you can borrow 350k and real estate is going to go up forever and ever and ever doesn't necessarily make it true.

Unlike the banks who can be bailed out, if you foreclose on your home you aren't going to be bailed out.

 

[SheriffJoe]

No but they can't be absolved from responsibility. Ultimately you make your own decisions.

Just because someone is telling you that you can borrow 350k and real estate is going to go up forever and ever and ever doesn't necessarily make it true.

The consumer (with poor credit) still needs to find someone that will lend him 400k with no money down.

The truth is, loan sharks are more rational than the govt.

 

[akphidelt]

The consumer (with poor credit) still needs to find someone that will lend them 400k with no money down.

The truth is, loan sharks are more rational than the govt.

Loan sharks who have to take the risk of their loan. If a loan shark had a bigger loan shark willing to buy it off them and they get paid a fat spread for doing pretty much nothing, they would give loans to any degenerate out there.

 

[SheriffJoe]

Loan sharks who have to take the risk of their loan. If a loan shark had a bigger loan shark willing to buy it off them and they get paid a fat spread for doing pretty much nothing, they would give loans to any degenerate out there.

Nice theoretical retort.

Except...

No such shark exists in the real world - unless it's the govt.

Over $1 trillion in Fannie and Freddie mortgage-backed securities...the perfect resting place where these toxic assets went to die, propagating more of the same across the market.

What part of this equation do you not understand?

 

[akphidelt]

Nice theoretical retort.

Except...

No such shark exists in the real world - unless it's the govt.

Over $1 trillion in Fannie and Freddie mortgage-backed securities...the perfect resting place where these toxic assets went to die, propagating more of the same across the market.

What part of this equation do you not understand?

Lol, that's exactly what happened. There isn't even a single sane person who questions that fact. You're a weird ass dude.

 

[SheriffJoe]

Lol, that's exactly what happened. There isn't even a single sane person who questions that fact. You're a weird ass dude.

Lol, that's NOT exactly what happened. THIS is what happened:

http://www.theatlantic.com/business...vernment-did-cause-the-housing-crisis/249903/

Congressman Frank, of course, blamed the financial crisis on the failure adequately to regulate the banks. In this, he is following the traditional Washington practice of blaming others for his own mistakes. For most of his career, Barney Frank was the principal advocate in Congress for using the government's authority to force lower underwriting standards in the business of housing finance. Although he claims to have tried to reverse course as early as 2003, that was the year he made the oft-quoted remark, "I want to roll the dice a little bit more in this situation toward subsidized housing." Rather than reversing course, he was pressing on when others were beginning to have doubts.

​

His most successful effort was to impose what were called "affordable housing" requirements on Fannie Mae and Freddie Mac in 1992. Before that time, these two government sponsored enterprises (GSEs) had been required to buy only mortgages that institutional investors would buy--in other words, prime mortgages--but Frank and others thought these standards made it too difficult for low income borrowers to buy homes. The affordable housing law required Fannie and Freddie to meet government quotas when they bought loans from banks and other mortgage originators.

At first, this quota was 30%; that is, of all the loans they bought, 30% had to be made to people at or below the median income in their communities. HUD, however, was given authority to administer these quotas, and between 1992 and 2007, the quotas were raised from 30% to 50% under Clinton in 2000 and to 55% under Bush in 2007. Despite Frank's effort to make this seem like a partisan issue, it isn't. The Bush administration was just as guilty of this error as the Clinton administration. And Frank is right to say that he eventually saw his error and corrected it when he got the power to do so in 2007, but by then it was too late.

It is certainly possible to find prime mortgages among borrowers below the median income, but when half or more of the mortgages the GSEs bought had to be made to people below that income level, it was inevitable that underwriting standards had to decline. And they did. By 2000, Fannie was offering no-downpayment loans. By 2002, Fannie and Freddie had bought well over $1 trillion of subprime and other low quality loans.

Fannie and Freddie were by far the largest part of this effort, but the FHA, Federal Home Loan Banks, Veterans Administration and other agencies--all under congressional and HUD pressure--followed suit. This continued through the 1990s and 2000s until the housing bubble--created by all this government-backed spending--collapsed in 2007. As a result, in 2008, before the mortgage meltdown that triggered the crisis, there were 27 million subprime and other low quality mortgages in the US financial system. That was half of all mortgages.Of these, over 70% (19.2 million) were on the books of government agencies like Fannie and Freddie, so there is no doubt that the government created the demand for these weak loans; less than 30% (7.8 million) were held or distributed by the banks, which profited from the opportunity created by the government. When these mortgages failed in unprecedented numbers in 2008, driving down housing prices throughout the U.S., they weakened all financial institutions and caused the financial crisis.

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

I don't give a fat fuck what your utterly clueless pseudo-intellectual ideological academic friends think, this bubble was govt socially engineered from start to finish, with predictable catastrophic results -- FACT.

Those who try to blame the "free market" don't understand the "free market" and economics.

"greedy-ass private sector" face)(*^%

 

[akphidelt]

No, banks passing off the risk to Wall Street and Wall St passing off the risk to investors and AIG is exactly what happened. Not even debatable. Even Wall Street admits to such. You are a weird ass dude.

 

[SheriffJoe]

No, banks passing off the risk to Wall Street and Wall St passing off the risk to investors and AIG is exactly what happened. Not even debatable. Even Wall Street admits to such. You are a weird ass dude.

"before the mortgage meltdown that triggered the crisis, there were 27 million subprime and other low quality mortgages in the US financial system. That was half of all mortgages.Of these, over 70% (19.2 million) were on the books of government agencies like Fannie and Freddie, so there is no doubt that the government created the demand for these weak loans; less than 30% (7.8 million) were held or distributed by the banks, which profited from the opportunity created by the government."

70% of these toxic assets were on the government books (less than 30% held by the "greedy ass private sector" face)(*^%, who did profit from the govt's stupidity) and our resident Paul Krugman can't admit his "social justice" ideology crashed the entire economy from start to finish.

Hey 'academic' genius, markets don't/can't work when the govt uses it's authority to distort them. Exhibit B: Obamacare.

Can our libtard get any more fucking clueless???

 

[akphidelt]

Sheriff Joe turning this in to another birther conspiracy. Amazing how weird he is, lol. Imagine having the ability to just ignore any fact you don't like and believe any shit you make up. Must be fun to be a conservative.

 

[SheriffJoe]

Sheriff Joe turning this in to another birther conspiracy. Amazing how weird he is, lol. Imagine having the ability to just ignore any fact you don't like and believe any shit you make up. Must be fun to be a conservative.

"70% (19.2 million) were on the books of government agencies like Fannie and Freddie, so there is no doubt that the government created the demand for these weak loans; less than 30% (7.8 million) were held or distributed by the banks, which profited from the opportunity created by the government."

You are an utter embarrassment to the radical 'cause' you champion.

 

[akphidelt]

Where is your source for those numbers?

 

[SheriffJoe]

Where is your source for those numbers?

Widely available data - you really do pride yourself on showing off your ignorance on...well, anything.

"In 2013,Fannie and Freddie together backed about 61% of new mortgage-backed securities, down from 70% in 2009, but far higher than 27% in 2006, according to data from Inside Mortgage Finance, a publication that closely tracks industry trends."

http://blogs.marketwatch.com/capitolreport/2014/05/08/how-rising-guarantee-fees-are-impacting-fannie-mae-freddie-mac-profits/

Actually, it doesn't matter if it's 30% or 70%, the end result is the same: DISTORTED MARKETS AND BUBBLES

Hey stupid, if a "big shark" govt agency is willing to buy toxic mortgages from a little shark like me, well, I'll lend any $$$ to a pile of dog shit, and then simply pass the buck - socialized risk, capitalist rewards.

Greedy? Irresponsible? Immoral?

That kind of libtard language is reserved for clueless sanctimonious academics.

Govt induced? Absolutely. No govt dumping ground for these toxic assets, no housing bubble.

Who was the "big shark" that created the housing bubble? 'Greedy' private banks who took all Big Govt gave them?

HA HA HA HA HA HA HA HA HA HA HA HA HA

My god are you ever libtarded.

:hahahahah

 

[akphidelt]

Lmao!! You are using post crises numbers?? Now that's hilarious. Joe is a retard.

 

[Acebb]

Oh Shock FCIC Member: Democrats Whitewashed Government's Role in Financial Meltdown

In a just-released book, former FCIC member Peter Wallison says that a Democratic Congress worked with the commission's Democratic chairman to whitewash the government's central role in the mortgage debacle. The conspiracy helped protect some of the Democrats' biggest stars from scrutiny and accountability while helping justify the biggest government takeover of the financial sector since the New Deal.


Wallison's sobering, trenchantly written "Hidden in Plain Sight: What Really Caused the World's Worst Financial Crisis and Why It Could Happen Again" reveals that the Democrat-led panel buried key data proving that the U.S. Department of Housing and Urban Development and other federal agencies pushed the housing market over the subprime cliff. The final FCIC report put the blame squarely on Wall Street.


In 2009, then-House Speaker Nancy Pelosi appointed her California pal Phil Angelides, a long-time Democrat operative, to lead the commission. The fix seemed to be in, and Wallison's account of the inner workings of the 10-member body confirms it.