Chavez Posted September 20, 2008 Share Posted September 20, 2008 The Clinton and Bush administrations both promoted home ownership and strong-armed firms into giving mortgages to people who couldn't afford them. The companies went along with it, knowing they'd be bailed out. Yep, all those huge multinational banks were dragged kicking and screaming into the mortgage bubble. Quote Link to comment Share on other sites More sharing options...
muck Posted September 20, 2008 Share Posted September 20, 2008 IIRC, the Community Reinvestment Act from the mid-1990s was not widely welcomed by the bankers at the time...and, again, IIRC, it was a leading source of the current mortgage / housing issues...the "headwaters" of sorts. Quote Link to comment Share on other sites More sharing options...
wiegie Posted September 21, 2008 Share Posted September 21, 2008 (edited) IIRC, the Community Reinvestment Act from the mid-1990s was not widely welcomed by the bankers at the time...and, again, IIRC, it was a leading source of the current mortgage / housing issues...the "headwaters" of sorts. IMO, trying to pin the current situation on the CRA is misguided as most of the subprime loans were not made by banks that had any obligation (such that there even was any) to the CRA. (Edited to add: But I think we are really going to hear a lot of people try to blame the crisis on the CRA for a few reasons (1) some people don't want to admit/accept that markets can fail on their own (2) some people like to blame government policies for problems, especially policies that might be viewed as "do-gooder" policies (3) for purely political reasons some people will want to blame a policy that was mostly intended to help minority families because it will help them with the implication that a minority who suddenly came into a position of power would expand such policies even at the expense of the overall economy (I can't say what particular minority I might be implying here for fear that it would cause this thread to get deleted).) Edited September 21, 2008 by wiegie Quote Link to comment Share on other sites More sharing options...
muck Posted September 21, 2008 Share Posted September 21, 2008 IMO, trying to pin the current situation on the CRA is misguided as most of the subprime loans were not made by banks that had any obligation (such that there even was any) to the CRA. Could be. Again, I'm not claiming to have a view on this...just thought I'd bring it up. I haven't had a chance to read much about this in the press due to other committments, and the CRA just sorta popped in my head as being a possible culprit. (Edited to add: But I think we are really going to hear a lot of people try to blame the crisis on the CRA for a few reasons (1) some people don't want to admit/accept that markets can fail on their own (2) some people like to blame government policies for problems, especially policies that might be viewed as "do-gooder" policies (3) for purely political reasons some people will want to blame a policy that was mostly intended to help minority families because it will help them with the implication that a minority who suddenly came into a position of power would expand such policies even at the expense of the overall economy (I can't say what particular minority I might be implying here for fear that it would cause this thread to get deleted).) 1) Good point. They can fail all by themselves. 2) True. "Do-gooder" policies can be easy targets ... just like "corporate welfare" policies get blamed. 3) Dangerous path ... for the sake of all the good dialog in this thread, PLEASE (to everyone else reading it) do not comment on this particular part of this post. Don't need to get the thread gun out. There was a bunch of pressure from congress to industry to extend the "American Dream" of home ownership to broader cross sections of the citizenry. I know that GWB talked about this a bunch in his first term. I believe that Clinton did as well. So, IIRC, Congress mandated some things for banks to do, and then, with the new rules, banks (and others) figured out how to make a bunch of money using these new rules ... and for years, Congress didn't do much with oversight of the rules or enforcing the rules ... and companies continued making money and taking even more concentrated types of hard to understand risks ... I wonder how Lou Ranieri feels about all of this? Quote Link to comment Share on other sites More sharing options...
wiegie Posted September 22, 2008 Share Posted September 22, 2008 fwiw, I'm starting to have my doubts about this whole bailout plan Quote Link to comment Share on other sites More sharing options...
AtomicCEO Posted September 22, 2008 Share Posted September 22, 2008 fwiw, I'm starting to have my doubts about this whole bailout plan So, printing up a trillion dollars and handing it out to all these failing companies is going to cause massive inflation, right? What's the safe play here... keep my money in the market so it inflates with the dollar, or get the hell out and wait for the loud boom? Quote Link to comment Share on other sites More sharing options...
CaP'N GRuNGe Posted September 22, 2008 Share Posted September 22, 2008 Gold maybe? Quote Link to comment Share on other sites More sharing options...
AtomicCEO Posted September 22, 2008 Share Posted September 22, 2008 Gold maybe? I looked last night, and my 401K and IRA don't seem to have a gold option. Quote Link to comment Share on other sites More sharing options...
muck Posted September 22, 2008 Share Posted September 22, 2008 I looked last night, and my 401K and IRA don't seem to have a gold option. You can invest your IRA in gold (even gold bullion). You may have to get a different custodian (i.e., you may not be able to keep it at TD Ameritrade, or wherever). Quote Link to comment Share on other sites More sharing options...
SheikYerbuti Posted September 22, 2008 Share Posted September 22, 2008 Gold's up $20 an ounce today. Quote Link to comment Share on other sites More sharing options...
CaP'N GRuNGe Posted September 22, 2008 Share Posted September 22, 2008 http://finance.yahoo.com/q/cq?d=v1&s=G...GC+AEM+AUY+GOLD Up HUGH today. Quote Link to comment Share on other sites More sharing options...
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