getting a grip on greed-mcquaig

7 posts / 0 new

Tue, 2009-03-24 18:30

wanker

http://www.rabble.ca/columnists/getting-grip-greed

I don't understand her thesis. She seems pre-occupied with a lack of regulation in the financial system but doesn't provide detail.

I think its pretty obvious that the financial meltdown and subsequent credit crunch was due to the sub prime mortgage problem. Government pushed banks and other financial insitutions to reduce mortgage lending standards in order to meet government set goals for more home ownership. Wall securities collapsed because of those bad mortgages not because of a lack of regulation. The government was fueling the problem from the outset.

She's right about greed though but government is supposed to look out for us, not create a climate for potential disaster. Wall street overlords will happily pocket fat commissions and bonuses but they will be even more eager to do so when government browbeats them into ignoring decades of experience with mortgage defaults.

The financial meltdown is a failure of US government housing policy more so than a lack of regulation of the financial system.

Tue, 2009-03-24 18:39

Jingles

The problem wasn't bad mortgages, it was the deregulation of the financial industry that led to massive overleverage, speculation, short selling, and outright fraud.

Read some Mike Whitney on the subject.

Tue, 2009-03-24 18:46

remind

Nonsense,

Tue, 2009-03-24 21:35

quantum

Jingles wrote:

The problem wasn't bad mortgages, it was the deregulation of the financial industry that led to massive overleverage, speculation, short selling, and outright fraud.

Read some Mike Whitney on the subject.

I'm not sure what Mike Whitney has to say but the sub prime mortgage crisis is very real.

Wed, 2009-03-25 05:09

fogbrella

Am I imagining things? or has this "financial meltdown" been totally devoid of discussion about the effect which that tsunami of high oil prices we experienced had on everyone's bottom-line - remember?

Everyone was cryin' the blues, from ordinary working people, travelling salespersons, to truckers to cruiseships, to airlines and beyond.

That price-rise began - funnily enough - the day after 9/11/01, and continued it's obscene ascent through the lead-up to, and actual "Shock and Awe" invasion of Iraq? - which our own Prime Minister says was "a mistake", by the way - even though Big Oil, because of that price-rise - despite all the harm it was doing, happily amassed the largest profits in corporate history?

(by the way, oil prices were still around $20 US/bbl pre-invasion - and soared to $145US/bbl in August of '08 - it is now around $45US/bbl - over TWICE it's value in March 2003, but Big Oil's still crying the Destitution Blues... these guys are good!)

However, I distinctly remember the seriously negative effects which soaring gasoline prices were having, on practically everyone, during that wave, but it's never mentioned as having had ANY effect whatsoever - it's all "bad paper", "bad banks", "bad executives", etc...

Nary a mention of that bleeding t$unami, though....

While the details are a closely-guarded Cheney secret, I'm convinced that it was during those "Energy Task Force" meetings Cheney held, pre-9/11 no less, with (as-yet-unnamed) Oil Company execs, that this sinister plan - to raise the world price of oil - was hatched.

- the meetings likely included this line:

("there's nothing like an invasion, by a massive, Western, Christian, oil-dependant military force, launched, spectacularly, into the heart of an oil-rich, Muslim, Arab, Middle-Eastern nation, to drive the price UP and UP and UP, and boys, my White House can Deliver!..."

The gang in the White House, notoriously into Big Oil - Cheney, Bush, Rice, et al - weren't also somehow aware that the paper would eventually hit the fan, were they?

And, being aware of the coming collapse, they simply couldn't have deliberately engineered the notion of "Danger! Must Attack Iraq!", in order to maximize oil profits - IE pocket their Billions - BEFORE that happened?

Nobody's that sinister, are they?

('course, who, in their right minds, would expect people to pay $4.50/gallon for gas AFTER some looming financial collapse?)

I also recall that high oil (ie fuel) prices only began to subside - also funnily enough - during the run-up to the November 2008 U.S. elections - AS IF that price drop - from out of the blue - would have helped get Republicans back in power... (also laughable)

Because it was then, suddenly, (and conveniently) it seems, in the midst of the then-falling fuel prices, that the "mortgage meltdown" emerged, and in the process seemed to displace the now-dissipated fuel-price crisis, without a mention by anyone in the MSM of it's possible contribution TO the "meltdown"

then, of course, to complicate matters even further, there's this:

(which should have been fully diseminated BY our media at the time, but was NOT:)

http://www.atimes.com/atimes/Middle_East/EC20Ak07.html

just sayin'...

LOVE YOU LINDA!

Wed, 2009-03-25 06:42

ElizaQ

wanker wrote:

http://www.rabble.ca/columnists/getting-grip-greed

I don't understand her thesis. She seems pre-occupied with a lack of regulation in the financial system but doesn't provide detail.

I think its pretty obvious that the financial meltdown and subsequent credit crunch was due to the sub prime mortgage problem. Government pushed banks and other financial insitutions to reduce mortgage lending standards in order to meet government set goals for more home ownership. Wall securities collapsed because of those bad mortgages not because of a lack of regulation. The government was fueling the problem from the outset.

She's right about greed though but government is supposed to look out for us, not create a climate for potential disaster. Wall street overlords will happily pocket fat commissions and bonuses but they will be even more eager to do so when government browbeats them into ignoring decades of experience with mortgage defaults.

The financial meltdown is a failure of US government housing policy more so than a lack of regulation of the financial system.

No, that was just a small part of it, not the cause of it by far. Sub-prime mortgages were more a symptom or result not a cause. Do some reading about credit default swaps (CDS) and dervitives schemes.

Wed, 2009-03-25 13:58

quantum

ElizaQ wrote:

No, that was just a small part of it, not the cause of it by far. Sub-prime mortgages were more a symptom or result not a cause. Do some reading about credit default swaps (CDS) and dervitives schemes.

I agree CDS' caused all sorts of problems later but the root cause of the meltdown were the toxic mortgages. Mike Whitney wrote this piece in 2007 and saw as did many others, the havoc that was about to be unleashed on the economy, from the fallout from sub from primemortgages.Sub prime mortgages couldn't survive the bursting of the housing bubble.

http://www.informationclearinghouse.info/article17145.htm

The ripple effects of the housing crash will be felt throughout the overall economy; shrinking GDP, slowing consumer spending and putting more workers in the growing unemployment lines.
Congress is now looking into the shabby lending practices that shoehorned millions of people into homes that they clearly cannot afford. But their efforts will have no affect on the loans that are already in place. $1 trillion in ARMs (Adjustable Rate Mortgages) are due to reset in 2007 which guarantees that millions of over-leveraged homeowners will default on their mortgages putting pressure on the banks and sending the economy into a tailspin. We are at the beginning of a major shake-up and there’s going to be a lot more blood on the tracks before things settle down.