They’re going about it all wrong
I largely sympathize with the anger displayed by the “Occupy Wall Street” protests. Most of the financial woes we face can be traced back to reckless gambling on Wall Street. I have spent years studying the causes of the banking meltdown and the complete lack of consequences for the criminals who caused the housing/credit markets to collapse. However, their anger is misdirected and should be focused on Wall Street’s manipulation of government at all levels to avoid the consequences of their gambling and greed addiction. After all my research here is the broad overview of how it all went down:
Wall Street created a series of financial “products” that were designed to broaden the risk associated with banking across the economy. These “products”(which don’t produce anything) soared in popularity because they seemed to mitigate risk and offer a high reward. The “products” were especially popular in the commodities and housing markets because they also offered multi-tiered opportunities for the banks to make commissions. When the Federal Reserve lowered interest rates to nearly 0, and then actually 0, it incentivized all of these financial institutions to take what is essentially free money and dump it into their magical no-risk, high-reward financial instruments. The problem is that these financial instruments were, and continue to be, deeply flawed.
Here is how these “products” work in the housing market: A person takes a loan out with a bank to buy a home, a mortgage. The bank knows that a certain percentage of people will default on those loans, so they package those loans together with other loans to create a sense of security. That bundle of loans (mortgage backed security) can now be traded, sold, insured, and bet on, and every time a transaction happens with that loan, somebody makes a commission. Those commissions and unmitigated greed, coupled with the idea that these securities had no risk and free money from the Fed, led the institutions on Wall Street to abandon all prudence. Banks started borrowing more money to continue the betting on these securities, overleveraging themselves at a rate of 40-1, 50-1 or in some cases 80-1, but even that didn’t satiate their greed. They made a legislative push in all 50 states to repeal “prudence” laws that prevented administrators of state retirement and pension plans from investing in anything but the safest investments. To fuel their irresponsible gambling, these bastards literally used their money and influence to gain access to the money that hardworking people had set aside for their retirements.
The problem with these securities is that they blur the actual value of the collateral (the mortgages) and therefore cannot receive a proper valuation. As they are re-bundled and sold, they continue to get farther away from that original loan, which is the only source of real value. Even at the source, the loans were overvalued because the government had begun demanding that proper underwriting be waived to ensure “fairness.” Basically, federal government idiots thought that not making a loan to somebody who couldn’t pay it back was unfair/racist/classist and therefore should be punished. To acquiesce, the banks developed a whole new set of “products” like Adjustable Rate Mortgages (ARMs) and interest-only loans that created a false sense of ability to pay back. So a mortgage that was overvalued to begin with was then securitized with other overvalued mortgages, so that it could become even more grossly overvalued. Then the quietly unstable security was borrowed against to the tune of 50-1 or even 100-1.
Eventually, Wall Street realized that they had bet everything they had, everything they could borrow, and everything they could steal (retirement, pensions) on the incredibly overestimated value of these products, but by then everyone had bought into the game and the giant bubble they had created collapsed.
49 Responses to “They’re going about it all wrong”
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So who is at fault here? List the players? Wall Street, Federal Gov’t. Who was Treasury Sec. during this time?
WHILE WE ARE AT IT, GIVE REAL CONTROL IN CORPORATIONS TO THE SHARE HOLDERS E.G. TOOLS TO CONTROL THE HIGH PAID EMPLOYEES – CEO’S ETC. THINK ABOUT IT THESE PEOPLE IN COLLUSION WITH THE BOARD OF DIRECTORS GIVE THEMSELVES H U G E AMOUNTS OF MONEY AT THE EXPENSE OF NOT ONLY SHARE HOLDERS BUT ALSO EMPLOYEES. HOW DO WE GO ABOUT PUTTING THE BREAK ON THIS TYPE OF FRAUD ?
LET’S NOT FORGET, OUR ‘SCHOOLS OF HIGHER LEARNING’ ARE WAY TO EXPENSIVE. TO A LARGE EXTEND BECAUSE PROFESSORS AND OTHER GUILTY MEMBERS ARE W A Y OVERPAID.
I AM A BONA FIDE CONSERVATIVE WHICH MEANS I FIRMLY BELIEVE YOU CAN NOT SEPARATE INTEGRITY FROM ALL ASPECTS OF BUSINESS. WHAT WE NEED IS INDIVIDUALS WHO HAVE BOTH MORAL AND INTELLECTUAL INTEGRITY.
I have a solution! Limit ALL campaign contributions to $5000 max, INCLUDING CORPORATIONS AND UNIONS. This is the reason our politicians are no longer listening and have become corrupted by special interests. Because there is no limit on campaign contributions from corporations and unions. Until this loophole is corrected, we will continue to have corrupt politicians in office who are only driven by greed, and who are being directed by people like Warren Buffett & George Soros.
Totally agree; and free and equal TV time too.
I agree, Bill. While this is an excellent article on how the Wall Street involvement developed, why all those loans went bad was pretty much glossed over. I, too, was hoping to read just who in Congress thwarted congressional action to keep the pressures off the banks to make the bad loans. The public should know whose influence overcame decades of lending guidelines, from red-lining to no-doc loans.
Hi. My studies say that the Federal Reserve Chairman has the responsibility to keep things working properly in banking and loans.
This is a Liberal cover job for the melt down. They neglect to say that a liberal congress under George Bush mainly under the leadership of Barney Frank and Chris down passed a bill through congress that said Fanny and Freddie had to guarantee loans with nothin as a down payment. Ie a home was open to anyone in the country. A home was a right. The culprits threatened the banks if they did not take these loans the banks would be taken to court. The banks were terrified of the huge number of loans and kept bundling them and passing them around. Greenspan and Bush warned and warned and warned of the consequencec. fFinally the bubble burst. The CEO of Freddies ran – quit.Thus the melt down. The Liberals are trying to change history.
This is a cover job by the liberals to change history. During the last couple of years of the Bush administration Barney Frank and Chris Dowd passed a bill that said everyone has a right to a HOME. They passed a bill through congress that gave people loans with nothing down. These loans were guaranteed by Freddie and Fanny.The two culprits told the banks that if they did not take the loans Frank and Dowd would take out lawsuits agaibst them because it was law. Greenspan and Bush repeated warned of an impending crisus. The banks did not know what to do with the bad loans. They did not want them so they bundled them and continually passes them around. Finally there was the big crisus. The CEO of Freddie quit. No one was ever held accountable. Do not believe this cover job.
it is big business and big government and big union laborers whom are causing this problem for america oh and don’t forget george soros whom has and will bring america down he has done this in three other countries and then soros makes a ton of money for himself not for the americans go read soros books he even tells how he will do it the PIG!!! GET OUT OF OUR COUNTRY SOROS AND YOUR THUGS WE WILL CHASE YOU OUT BLAME SOROS BLAME4 SOROS THAT IS GEORGE SOROS ITS ALL HIS FAULT ALONG WITH OBAMA BACKING HIM UP WITH OUR TAX DOLLARS THEY ARE BOTHY PUTIRD PEOPLE IN MY OPINION
Do we have to give out our ages to blog?
Thanks for the correct fault to the problem. Barnstabble Frank & Sen. Dodd were the major problem in congress.
To me it seem that morons are running the country. They are impossible to get rid of, and they go to work every day feeling they are accomplishing great things.
Worthless people nalways seem to be in the real way of progress.
Val
Actually, this goes back to the FDR Administration. Roosevelt established a great number of the independent federal agencies we take for granted. He rewrote numerous regulations WITH the help of the very institutions he sought to regulate. They were invited to write the very regulations they would be governed by.
After 80 years of too much meddling, restriction and restaint we are according to Goldberg a
(that’s a smiley) fascistic state, a partnership between government and coporations, a la GE for instance.
Dustin,
I appreciate your thoughtfulness on these issues. Wall Street is and always has been opportunistic.
However, if our Federal Government is let off the hook as simply idiots, as an excuse for this negligent governing, and our criminal justice system sits on its hands, then our branches of our government are as guilty as Wall Street. It seems that one would be in more criminal trouble from shoplifting at WalMart than stealing billions from our retirement plans and frankly our economy as a whole.
Until these people go to jail these types of products will proliferate.
I am a conservative and I am anti-Wall Street. I wouldn’t buy a stock to save my life.
I invest in what I know and who I know.
These crooks should be in jail.
How crazy!
Dustin’s assessment is spot-on, SO good in fact that I’m copying the entire text for future reference—don’t worry, Dustin, credit will be given to you for the thoughtfully-worded statement!
Well done, as usual.
Hear, hear, Dustin. Now we need to stop the regulators from rotating from the reulatory agencies directly to the big-paying jobs at the investment firms. How about a two year or three years waiting period before they can go to work for an investment house. No more rewards for looking the other way. Great article.
Start with Fannie Mae and Fannie Mac , they were paid bonuses to underwrite these bad loans ?
You know, I get emails from organizations like this who seek to correct the problems that banking interests, corporate interests & corrupt politicians have caused. Yet they continue to support candidates who are pro-war, pro-NWO, pro-forced inoculations, and just tell us what we want to hear. When these Tea Party organizations quit supporting candidates like Bachman, Cain, Perry & Romney, and instead throw their support behind Dr Ron Paul (someone who will give us back our freedoms that the previous administrations have stripped away), then I would be inclined to donate. Until the Tea Party goes back to it’s roots (before being hijacked by RINO’s wearing Tea Party emblems), they will no longer be receiving my support. A once noble cause, hijacked by NWO warmongers!
Gremlin, are you just voicing an opinion or are you backing that up with facts? The TEA Party is a grassroots group of Americans who want to elect a Constitutional Conservative. Ron Paul is not the only one in the race. If you are serious about a candidate’s record and not just what they say, look to Michele Bachman. Newt Gingrich is one of the greatest minds of our time and brought the country to prosperity and a balanced budget while a democrat was in power! THe Welfare to Work Act was passed during that Congress which gave poor people a path to education and a way off of welfare. Rick Santorum also has a good record. Try doing some due diligence on the candidates records.
Newt??? Are you kidding!!! He’s a neo-con! Santorum & Bachman are both warmongering RINOs! and all three are Israeli boot lickers. Do you want more freedom, or just more war! I’m not Republican, I’m not Democrat, and I’m no longer Tea Party. I’m pro-freedom, and I ONLY trust DR RON PAUL!!! He has a 30 year record of voting along Constitutional lines, NO OTHER CANDIDATE HAS A RECORD THAT EVEN COMES CLOSE!!! Obviously you get your “news” from the mainstream media whores. If you are interested in knowing the truth about who these people are that you stand behind so firmly, I suggest you start with infowars.com, prisonplanet.com, blacklistednews.com, alternativenews.com, or activistpost.com, because you will not find the truth on your TV screen!!! Mainstream media was hijacked long ago by special interests.
You article doesn’t get to the root cause of the housing crisis. Who encouraged and allowed the bad loans to be made in the first place? Wall Street only took advantage of the stupidity that started back in the Carter days. Its was plain to see that housing prices were way out of line and could not be sustained. The piper must be paid sooner or later.
I am reading a book for the second time called “The Creature from Jekyll Island. by G. Edward Griffin. I encourage everyone to read this book. It is about the meeting of the wealthy crooks who got together and started the Federal Reserve. When one reads about how crooked the big banks have been since 1913, how they have screwed up all the banks worldwide and how they have messed up the economies worldwide you wonder why the Congress does not do anything to stop this madness with our money, Nothing they do will change any of the crap we face until the Federal Reserve and other world banks are reigned in. Wall Street and everything else in our lives.
BP
Bill Parrott, You can go back even further than that. I have yet to read the book you are currently reading, but it is on my list. Read the 130 page book written in 1970 by W. Cleon Skousen titled, “The Naked Capitalist,” which is a commentary on Dr. Carroll Quigley’s 1300 page book written in 1966 titled, “Tragedy and Hope, A History of the World in Our Time.” It’s not just Wall Street, it’s not just the Fed, it’s not just Jimmy Carter,(granted, the worst president until now), it’s is a secretive regime possibly worse than those at Jekyll. It has it’s start in the 1800′s with the Rothschilds and Central Banks. Reading the Skousen book is sufficient to explain the Quigley book. Also, there is another book of about 130 pages by Wickliffe B. Vennard titled, “The Federal Reserve Corporation.” On the title page it has a subtitle, “42 Years of Subversion in 100 Acts.” Last time I checked it could be found at http://www.alibris.com. I think it’s about $7 or $8 dollars. To really understand what has happened to this country and around the world, one has to dig through old books and information before everything was “sanitized.”
You got the secondary players right – the folks who took advantage – but left out the enablers: Carter’s Community Reinvestment Act, Obama’s Acorn pressure in Chicago, Clinton’s “strengthening” of the CRA, Fed printing Money (M2) with abandon, Dodd, Franks, and Waters preventing Sen. Shelby, and other Repubs from reining in Freddie & Fannie and, of course, Geitner at the NY Fed.
I’ll tell you another crime here that is even worse than what you explained in your article, and that is, whose going to go to jail for this unbelieveable corruption? Whose looking into this? I don’t just want some so-called ‘incompetents’ to lose their jobs. This is what bothers me most about big govt. Nobody is actually held accountable in the sense that what they’ve done is created hardships and possible financial ruin to thousands maybe even millions of people.
I think when it gets to that stage of corruption, heads need to roll, and I don’t mean just losing your job.
Dustin, how do they have it wrong? You get the issues but somehow you feel the protests against these crooks are wrong? Wall Street is THE player in this mess; enabled by our government yes but still the major thieves. Seems to me that taking it to the heart of this insidious, greedy community is exactly what needs to be done. They don’t have it wrong — it is the start of a revolution and they are going for the head (brains) of the creature. Now perhaps the idiots in DC will pay attention. Bravo to the protestors!
Wall Street took advantage. It’s the Fed, which has never been audited, and the World Central Banking system. Check out my reply to Gremlin for two must read books.
Good, but you skipped over the FED role. The FED kept reducing interest rates going into the growing “bubble”, prompting more and more people to use ARMS, many with the idea of “flipping” the property in the hot market. Then the FED started quickly ramping up rates, precipitating the crash. “Fair housing” overloaded to train, but the FED ran it off the track.
I recommend the Gretchen Morgenstern book that just came out that makes it pretty clear that government policies designed initially to counteract red lining morphed into promoting home ownership for a greater and greater percentage of Americans, whether they could afford it or not, this created the subprime crisis because Fannie and Freddie could only increase home ownership by lowering lending standards and in turn the banks lowered lending standards to create products to sell to Fannie and Freddie, the whole thing was heavily promoted by Bill Clinton, Barney Frank and other democrats, a grand experiment that went flat. In any case “Wall Street” was a symptom of the policies, not the cause.
It wasn’t all ‘Wall Street’s’ fault. ACORN was up to their ears in forcing banks to make unsustainable loans to people who couldn’t pay them back. Everything that is going on now, is by design.
Research ‘Cloward Pivens Strategy’ and look at Obama and ACORN. It’s crystal clear. Cloward passed away years ago but Francis Fox Pivens is one of Obama’s close advisors. We all know Obama’s ties to ACORN.
The ‘Occupy Wall St’ protesters are nothing but brainless idiots that have been indoctrinated. On FOX this morning, they interviewed some of the protesters. LOL.
Reporter:”What are you protesting?”
Protester: “I want to eliminate Capitalism!”
Reporter: “And replace it with what?”
Protester: (dead silence and deer in the headlights expression)
The indoctrinators just want to try to create the protests we’ve seen in Europe and the middle east. Good luck with that! We are a little smarter here.
Good luck with that, you say? Guess what. It is coming to a town near you! With Obama in power and Holder head of DOJ, there will be a no holds barred mentality and we, meaning the American people will suffer. Infrastructure and private businesses will be destroyed and NO ONE will be prosecuted. The protests are just as Glenn Beck said. They are organized and managed by Socialist Progressives and carried out by Unions throughout the world aided by any young people and roustabouts they can organize.
I’ve always been told, “when you find yourself in a hole, stop digging”. If we aren’t smart enough to do that, I doubt that we are smart enough to avoid the financial and social ills that are being manifested in those “unsmart” countries. Just as a small rudder can steer a large ship, a few unchecked progressives can ruin a good country. I certainly hope our ship can be righted, but it’s going to take a new captain and a lot of strong oarsmen.
The “bailouts” over the screaming objections of the American voters were a repeat of the robberies and greed that got us here in the first place. The criminals were rewarded and the Middle Class was screwed – again. The corporate shills in government need to be thrown OUT of government and into prison, and the thieves of Wall Street need to go to prison. Wall Street must lose its access to government, Citizens United needs to be revisited – and undone. The whole idea of “corporate personhood” was lie anyway – it’s a law that was never passed. Next, the Fed HAS TO GO. They’ve been playing Monopoly with the US economy and now they’re printing money hand over fist as though is really WAS for monopoly games.
Americans, if the US industrial capacity is returned and laws that protect American workers and businesses are returned, will fund the things they want. Politicians should never have had the ability to ignore the voters! Next, Congress needs to be revamped. Any laws they pass should bind them as well as us. They should never be allowed to give themselves raises. Scrap their medical program and give them what We the People have; they’ll fix it in a hurry! They should get paid while they’re in Congress – two terms, no more – then they should go home with our thanks and go back to work.
Last but far from least, repeal the PATRIOT Act and get RID of all the fascism-enabling laws and agencies! A huge power grab and the destruction of any real liberties in America was ALL they were ever for!
Ian
I was born during the depression and my folks lived in a house that they co-owned with my grandparents, after my Dad died, we lived with my other grandparents. My mother remarried and they rented for 34 years, only after retiring to Fla. did they buy. My husband and I rented for 3 years then bought, At no time did I feel the rented places were less MY “HOME” than the ones we owned. Lesson is Yes everyone needs a hOME, BUT “Home is where the heart is” and one should not “Bite off more than you can chew”
Your sympathy for the “Occupy Wall Street” mob is unwarranted. These people are a ragtag collection of anarchists, communists, etc. who you must know, if you have heard any of them interviewed, have no clear, consistent message and are united only by their hatred of the free market system that made this country great. While Obama wages class warfare and vilifies Wall Street (with allies such as the “Occupy Wall Street” crowd), just look at all the Wall Street insiders who have and who continue to serve him as economic advisers and at the Treasury Dept. The real culprits here are elected representatives such as Barney Frank and Christopher Dodd, who pushed the banks to lend to homebuyers who didn’t have the means to pay off their mortgages, because that was part of their grand social engineering scheme. Now the banks, most notably Bank of America, are being villainized for instituting debit card charges. The real culprit is Sen. Dick Durbin, D-IL, who limited the charges banks could levy on merchants for the use of debit cards. What a genius!!! Did he think they’d just absorb billion dollar losses. Of course not. As should have been expected, the banks are now passing the “the Durbin Tax” on to their customers. But the mainstream media will whitewash the culpable Democrat legislators and blame the banks.
The tail for most of this trouble belongs on the donkey, the democrats. Carter and Clinton were the early pushers of the “everyone deserves a house” program.
When wall street was getting totally out of control. G W Bush notified congress of his concernes 17 times, to reel in the street. The last time he went before the senate with McCain to say that congress must put a stop to this. The video is on YouTube.
In 2007 the senate took a vote on it, BO and a majorty voted to leave things alone. Remember that in 2006 and 7 that the democrates controled both houses.
THE DONKEY WINS THE TAIL!
They don’t call it the Jackass Party for nothing! I doubt our minority favoring communist government is going to give me a free house anytime soon, being I’m a white male and all
Dustin missed [or "overlooked"] the root cause, as mentioned by Ray, Ken & Peter: The Community Reinvestment Act, originated and passed by Dems/ Carter. Spearheaded by Fannie & Freddie, this forced banks to provide a certain percentage of mortgage loans to buyers without any [or very low] credit.
So, obviously a much larger [than normal] level of failures had to occur…and occur they did.
Yes, some on Wall Street overdid it–call it greedy, but no one or group/company was forced to buy the “junk” bonds–or whatever instruments the Street produced.
I do not agree with this article on two points: First, the Wall Street Takeover people are radical leftists bent laying the groundwork (rioting, creating chaotic conditions, violent confrontations, etc.) for more socialist policies. I have no sympathy for their anger. Secondly, private sector markets respond to incentives, and as you rightly point out, cheap funding and the system awash with excess reserves, banks and other financial institutions responded as they did, and I don’t call that greed. That is self-interest, the interest of shareholders. The real culprit in this was the Fed under Greenspan’s leadership. Higher interest rates beginning in late 2003 and inching up thereafter would have obviated the entire mess. Of course the Democrat Congress would be screaming, but what is the point of an independent Fed, if it can’t stand up to this?
Stockton’s essay is probably correct as far as it goes, but it omits the seed causes of the housing bubble, which when it popped caused the (possibly irreparable) financial meltdown we are now experiencing. Those seed causes were (are) 1) The Fed keeping interest rates too low for too long, and 2) The federal government purchasing and/or guaranteeing so many of the mortgages used to finance the excessive housing, in furtherance of its policy of promoting home ownership. Wall Street behaved foolishly (and in some cases no doubt criminally) because they figured they were gambling with someone else’s money. This gambling money turned out to be yours, mine, our children’s and our grandchildren’s!
We citizens need to be ideological in the voting booth about not allowing the federal government to deviate from its constitutionally-limited role. Had we done this over the last few decades, we would not be experiencing the current meltdown. Picking economic winners and losers is not a proper role of government.
If the collectivists can credibly claim that the private market caused the meltdown and that the federal government is our only salvation, we are truly doomed. Please issue an explanation for how the above points (or at least some of them) were omitted from the essay.
The CRA was final impetus for putting our economy down the drain. That, with the enforcement of Dodd/Franks, loudly proclaiming that there was nothing to see here, move along, pretty much tipped it over. Goldman/Sachs managed to survive. Why? Huge donations to Obama and Franks would be my guess. The same goes for Freddie and Fannie donating to Democrat candidates (don’t ask me how that works because on the surface, they are owned by the government and taxpayers should not be forced to donate to political parties). The biggest problem with blaming Wall Street is that they are private bankers/stockbrokers who must make a profit while our Congress is supposed to be representing the citizens of this country, not lining their own pockets.
You know, being fairly long in the tooth, I’ve seen many of these things happen over the years and practically every law or mandate passed “for the poor” or “for the children” has backfired in ways Congress never even thought of. It’s only now because some of the American people have had their eyes opened that we can look back and see that each succeeding law or mandate gave a push to the present-day disaster.
Because of this I cannot agree that the onus falls on Wall Street. Those rioting on Wall Street are still just a bunch of malcontents being exhorted and pushed by the International Communist Party,
Better listen to Glenn Beck to find out what is really behind the wall street demonstrations. They are sent there by Soros and other liberals with the goal to take us to communism or socialism. Please listen to Glenn Beck
Try infowars.com, you’ll find far more truth there!
The Chicken or the Egg? Well, I believe it was the government first – Carter’s Community Reinvestment Act legislation that was heavily pushed by Clinton and an all Democratic Congress back in 1992 by the tune of $1.5 Trillion Dollars of these subprime bundled intraments that were purposely flooded into the worldwide credit markets and fully backed by the GSE (Government Sponsored Enterprise) Fannie Mae and Freddie Mac.
This pressure that was put to bare on the banking/financial institutions via Fed Muscle and groups like ACORN coupled with the loose money policies of Alan Greenspan and the Fed – based on the premise that housing values would always rise is what created the bubble and eventual collapse and Wall Street simply went along for the ride as a path of least resistance and a way to make money in my view…
Dustin,
I ordinarily enjoy your blog posts, however this one is a little off the mark. You’ve tried to explain an issue that is so complex it will be the subject of entire future textbooks and research careers into a few paragraphs.
I think it best to remember we are Republicans, or at least conservatives, and therefore should be concerned with evidence and facts. Let’s leave it to the “enlightened” liberals to toss around such meaningless terms as “corporate greed,” “reckless gambling”, “Wall Street manipulation” , neither is it appropriate to refer to unknown individuals as “bastards.” It is generally the left who demonizes their opponents. Who is this Wall Street entity you refer to, anyway? The pavement? The sum of all investors in Stocks & Bonds? Derivative investors? (which includes most farmers, incidentally who sell their harvest using derivative contracts and have been for 100 years.)
See what I mean, Dustin? Let’s stick to facts, evidence and well-reasoned arguments. The truth always prevails eventually. Let’s leave the demonization and mob tactics to the labor unions, community organizers and liberal intellectuals.
It’s understandably frustrating that the left has been winning the fight for the past several years, but we must retain our dignity knowing that right makes might.
Dear Dustin: grateful for your recap of the history, even though it took a leap for me at the point of bringing in pensions et al. As an HR specialist I can’t really imagine the inability of the finance industry to ignor the unemployment situation and the effect it has on business profits, mortages included. Whoa.
I believe that the worst is yet to come.
The debt and commitments for future debt have reached a point of potential global instability. Europe is in much deeper than we are. These are two of the largest economies in the world. All it might take is one or two more ‘crisis’.
Unless we can put a brake on government right now, something negative and big is bound to happen, sooner or later. Applying the brakes would hurt, but not nearly as much as what I fear is in store.
You forget about governments role in sparking the high risk lending in the firdt place. Fannie Mae was backing risky loans and the Clinton Administration was threatening banks to loan or they would go after them. ACORN was in on it too. So why blame it all on the banks-you sound like Obama.