US Presidential Elections 2

[Walsingham]

One could argue that what we're seeing is some blokes who don't support govt involvement in the economy failing to understand how to bloody do it right.

[taks]

One could argue that what we're seeing is some blokes who don't support govt involvement in the economy failing to understand how to bloody do it right.

certainly more regulation ain't the "way to do it right," yet that is what is going to happen. the only real evidence that exists is this: less regulation works better than more regulation.

 

taks

[Walsingham]

Erm... I'm beginning to think you're playing for points. You surely know that without reams of government regulation investors, insurers, banks and whatnot would routinely defraud people without any fear of the law. Hell, they try all the time, anyway.

[taks]

You surely know that without reams of government regulation investors, insurers, banks and whatnot would routinely defraud people without any fear of the law.

um, regulations to prevent this, fraud protection in particular, are legitimate. i've made that point countless times. government is there to protect the rights of both the seller and buyer, which means it is their job to make sure everyone is equal. fraud protection, full disclosure (which is really a fraud issue anyway), etc. are required "regulations."

 

taks

[Pop]

Oh yay, somebody brought up the CRA. Down with the underclass!

 

tl;dr

The CRA is not remotely one of the proximate causes of the current credit crunch, Housing collapse,and mortgage debacle. As I detailed in Barron's, there is plenty of things to be angry at D.C. about -- but this ain't one of them.

 

If you were to ask me to reveal the prime causative factor for the Housing boom, I would point you to Fed Chairman Greenspan taking rates to 1%, and then leaving them there for a year. The prime factor in the bust was nonfeasance on the Fed's part in supervising bank lending, allowing banks to give money to people who couldn't possibly pay it back.

 

The root legislative cause of the credit crisis was excessive deregulation. From exempting derivatives from regulation (2000 Commodities Futures Modernization Act) to failing to adequately oversee ratings agencies that slapped a triple AAA on junk paper, the pendulum swung too far away from reasonable oversight. By taking the refs off of the field and erroneously expecting market participants could self-regulate, the powers that be in DC gave the players on Wall Street enough rope to hang themselves with -- which they promptly did.

Edited October 8, 2008 by Pop

[Deadly_Nightshade]

I'm currently watching the debate and so far I think that Obama has been bending the truth less than McCain.

[Guard Dog]

Oh yay, somebody brought up the CRA. Down with the underclass!

 

tl;dr

The CRA is not remotely one of the proximate causes of the current credit crunch, Housing collapse,and mortgage debacle. As I detailed in Barron's, there is plenty of things to be angry at D.C. about -- but this ain't one of them.

 

If you were to ask me to reveal the prime causative factor for the Housing boom, I would point you to Fed Chairman Greenspan taking rates to 1%, and then leaving them there for a year. The prime factor in the bust was nonfeasance on the Fed's part in supervising bank lending, allowing banks to give money to people who couldn't possibly pay it back.

 

The root legislative cause of the credit crisis was excessive deregulation. From exempting derivatives from regulation (2000 Commodities Futures Modernization Act) to failing to adequately oversee ratings agencies that slapped a triple AAA on junk paper, the pendulum swung too far away from reasonable oversight. By taking the refs off of the field and erroneously expecting market participants could self-regulate, the powers that be in DC gave the players on Wall Street enough rope to hang themselves with -- which they promptly did.

 

Really? So you are telling me the government compelling banks to loan money to bad credit risks (CRA revised in 1995 by Bill Clinton) has nothing to do with the current crisis? That is a little absurd even for you. I'd also point out that bank deregulation begain with the Depository Institutions Deregulation and Monetary Control Act of 1980 passed by an all Democrat congress and signed by a Democrat president. It hit fever pitch when the Glass-Stengal act of 1934 was finally repealed by the Gramm-Leach-Biley Act of 1999 signed into law by Bill Clinton. I know you did not blame Republicans in your post but knowing you, it was coming.

[Killian Kalthorne]

I blame both the Democrats and Republicans for the financial crisis. The Democrats for setting us up with CRA, and the Republicans failing to act against it when they had both a majority hold on Congress and the Republican president. Also I blame Bush and his war policies for the overall economic slump and gas prices. There are some things I am all for socialism for, namely healthcare, but there i9s some things that needs to remain capitalistic in its function and that is banking and financial institutions. You just can't lend billions of dollars to people who can't pay it back. That is just stupid, yet our government forced banks to do just that.

[tarna]

"Um, Volourn, that is to protect her from as in against witchcraft, meaning she is against it and she sought protection from it. The fact she thinks that witchcraft has any sort of "supernatural" power that she needs protection from tells me that she is a Class-A nutjob. I think you need to brush up on your reading comprehension skills, Volourn."

 

Um.. The guy from Afrika used a 'ritual'. Sounds like witchcraft to me. Just like a mage in D&D uses magic to protect themselves from magic, she used witchcraft to protect herself from witchcraft. Makes sense. Afterall, a modern bullet proof fest won't protect one from withcraft, right? Come on, everyone knows this!

I would slap the dog-s**t out of you for this remark but it would require a bigger board than I care to swing at you right now!

 

Try a little research on the term 'ritual' sometime.

 

'Ritual' can involve something as 'little' as a regular regiment of prayer to 'protect' the recipient from danger.

[Humodour]

You surely know that without reams of government regulation investors, insurers, banks and whatnot would routinely defraud people without any fear of the law.

um, regulations to prevent this, fraud protection in particular, are legitimate. i've made that point countless times. government is there to protect the rights of both the seller and buyer, which means it is their job to make sure everyone is equal. fraud protection, full disclosure (which is really a fraud issue anyway), etc. are required "regulations."

 

taks

 

So you agree that government regulation is a good thing, then?

Edited October 8, 2008 by Krezack

[taks]

master of the strawman.

 

taks

[Humodour]

master of the strawman.

 

taks

 

How is that a strawman? I'm not misrepresenting you; I'm asking you a simple question.

 

Will you answer it or not?

[Killian Kalthorne]

The problem are the regulations. First they made the first set of regulations called the Reinvested Community Act. Then the made a second set of regulations to regulate the regulations in the 1990's. Now, since that didn't work, they are going to implement regulations to regulate the regulations that were to regulate the original regulations. Of course all of this may have been avoided if the first set of regulations wasn't put in place at the very beginning.

[Humodour]

The problem are the regulations. First they made the first set of regulations called the Reinvested Community Act. Then the made a second set of regulations to regulate the regulations in the 1990's. Now, since that didn't work, they are going to implement regulations to regulate the regulations that were to regulate the original regulations. Of course all of this may have been avoided if the first set of regulations wasn't put in place at the very beginning.

 

Exactly. Quite frankly the problem is not government regulation, it's bad government regulation. So when I hear people like taks screaming about the 'evils' of all government regulation, I naturally take issue. America, to put it simple, has stagnant regulation. I don't know why - I suspect too much interference from free market radicals and corrupt lobbyists. Poor handling of government regulation needn't be the norm, though (and indeed isn't in many other countries).

 

Still waiting for taks to answer my question, of course.

[Killian Kalthorne]

The point is there wasn't any need for the first set of regulations. Banks and financial institutions are businesses. When they loan money out, may it be a mortgage or a car loan, they need to make sure the people they are loaning the money to have the ability and the will to pay it back with interest. The problem here is that the RCA forced banks to loan money to people who could not afford the loan. If they didn't loan money to these people who could not afford the loan they would get hit with a lawsuit for discrimination which is a bunch of bull. Since these banks were forced to loan money to high risk people who just did not have the means to pay it back they had to do something to get as much as their money back as possible and that is where the variable interest rate came in.

 

Now if the RCA was not in placed, and banks only loaned money to people who can afford them we would not be in this situation in the first place. When you lend billions and billions of dollars to a group of people who cannot afford to pay it back there will be a crisis. There will be a financial backlash that will tear the economy down. It just wasn't bad government regulation, it was the fact that the government sought to regulate it at all.

Edited October 8, 2008 by Killian Kalthorne

[Killian Kalthorne]

Palin gets her due.

 

http://www.youtube.com/watch?v=8Qe0fgS7K8Q

Edited October 8, 2008 by Killian Kalthorne

[Humodour]

The point is there wasn't any need for the first set of regulations. Banks and financial institutions are businesses. When they loan money out, may it be a mortgage or a car loan, they need to make sure the people they are loaning the money to have the ability and the will to pay it back with interest. The problem here is that the RCA forced banks to loan money to people who could not afford the loan. If they didn't loan money to these people who could not afford the loan they would get hit with a lawsuit for discrimination which is a bunch of bull. Since these banks were forced to loan money to high risk people who just did not have the means to pay it back they had to do something to get as much as their money back as possible and that is where the variable interest rate came in.

 

Now if the RCA was not in placed, and banks only loaned money to people who can afford them we would not be in this situation in the first place. When you lend billions and billions of dollars to a group of people who cannot afford to pay it back there will be a crisis. There will be a financial backlash that will tear the economy down. It just wasn't bad government regulation, it was the fact that the government sought to regulate it at all.

 

No, it was just bad regulation. There are numerous ways to deal with the socioeconomic problems of the underprivileged through government regulation which don't cause the system to collapse. Why they weren't undertaken is beyond me. But again, I would seem it was due to paralysis between those wanting government regulation, and those wanting a pure laissez faire system - to the point that the compromise that evolved was impotent and dangerous. Kind of like McCain's healthcare scheme.

 

The issue here is that something needs to be done about America's low income earners. The subprime mortgages weren't the answer, but by the same token you can't just say "oh well, we tried" and brush them aside for good. Libertarians would probably love to do that since they don't believe in social welfare, and will thus try to pin this purely on any form of government regulation whatsoever, but the truth is that it was a very specific form of intervention that was at fault.

[Killian Kalthorne]

If you can afford to own a home then own a home, if you cannot then you shouldn't. That is my view on it. I cannot afford to buy a house, and to tell the truth I don't want to, however people who save their money, work to maintain good credit will eventually be able to own a house if they put forth the work to do so. The problem is that people think they deserve it even when they have done nothing to earn it.

[Rosbjerg]

I have to say that I'm suprised, that in a system like in the US, they made a law forcing banks to do something like that..

 

Even here in Scandinavia it would be considered a bad idea and I would argue that we are considerably more "red" than the US.

[Tigranes]

If you can afford to own a home then own a home, if you cannot then you shouldn't. That is my view on it.

 

That would make all this economics mumbo-jumbo a lot easier for people like me, but I recognise that in today's economic system, it's encouraged, acceptable and widespread to borrow money and juggle assets. Simply following the very simple path of "earn money, spend cash, save up" seems to be inefficient to a criminal degree for many families (or at least, it's seen to be).

[Brdavs]

First of all I have stated often enough I do NOT like George W Bush, did not vote for him in 04, and I believe he has been a terrible President that has squandered a historic opportunity. That said he has at time acted in the best interests of the US despite objections from the global community. For example, the Chinese and Russians have both loudly objected to the development of a missile defense system. Bush has authorized and funded it anyway because it is in the best interests or OUR country. I think Obama would have dropped it the moment he was challenged. He has already promised to kill the project. Failing to do the best thing for you own people because of the objections of enemies and competitors. How is that anything but weak?

 

Perhaps it is in the best interest of your country to stick to the non proliferation and other deals and not to atagonize players like Russia and China that have considerably more bite and leverage than the taliban do? Or co-develope the shield with the russians and place it in azarbedjan, the somewhat logical location for it to intercept the dreaded "Iranian threath", instead of the friggin Polish-Russian border lol. I mean seriosuly, hands up who buys the whole "only rogue states" story? And that new developments in russian balistic missles that are now most/only vonulabre after launch has nothing to do about slapping&developing ABM installations on their borders heh?

Perhaps Obama just thinks the likes of Russia are a greather possible threath than Iran ever could be. Heck the ammount of trouble given (and that could still be given) to US by Russia without even getting directly involved is staggering. Cost, risk & effect ratio? ;P

 

As for your "laissez-faire approach to economy" there has been no such thing in the US since FDR was President. This current "crisis" is the result of GOVERNMENT meddling. the GOVERNMENT passed the CRA that insisted a certain number of loans be to low income. The GOVERNMENT lowered credit requirements for CRA loans. The GOVERNMENT guaranteed bad loans buy buying them. And finally the GOVERNMENT compelled the artificially low interest rates that drove the housing boom. Had the not deregulated the banks in the 1980s and 90s, and left well enough alone with the CRA in the 90s and 2000s, or for that matter not regulated at all in 1934 none of this would have happened. I get a good chuckle when I hear the Internet Intellectuals spouting their screed about how this is a failure of capitalism. That would only be true if we actually had it.

 

As far as the regulation/deregulation being the core cause... you`ll be very hard pressed to convince me bankers lent money only coss of the government gun to their heads. This was THE thing to do to make good money (the prime directive) and a driving force of the economy. Twas the personification of the amarican dream upto the burst of the housing bubble.

Note that more than 50% of the subprime loans were made by banks NOT regulated by CRA and the majority of the rest by banks only partialy regulated. Over the thumb, 3 out of four subprime mortages were given out by institutions NOT regulated lol. And on top of that a recent study concluded that quote: "CRA regulated institutions were less likely to make subprime loans, and when they did the interest rates were lower. CRA banks were also half as likely to resell the loans."

Pesky detail dat eh... what can you do, peer pressure? Poor FM&FM.

 

But feel free to pound at the government regulation being there as the main cause. It`s much simpler that way. Fact is that most economst over the globe recognise deregulation and poor regulation (on the back of a regulation fobia) as major contributors to the problem. From france to japan, they be sayin your particular model apparently failed. But feel free not to learn a lession.

 

And you're correct. McCain may give us another David Souter, he was appointed by a Republican (and what a dark day that was) or John Paul Stevens who was put up by Ford. But Obama will certainly give us more of Breyer and Bader-Ginsburg who have never failed to see the Constitution as a tool to empower the state over the rights of citizens rather than a limit government power as the founders intended.

 

Best joke so far. Never in history has in my knowledge your constitution been so "raped" for the conveniance of the executive branch than in this past 2 terms. Phear the dems thoe.

Edited October 8, 2008 by Brdavs

[Strix]

Man denies hacking Palin e-mail

[Strix]

Obama Ads in Burnout Paradise!?

[Strix]

Jack Thompson Offers His "Expertise" to Sarah Palin

[Strix]

Alaska Governor Sarah Palin is guilty of abuse of power, according to a probe by the state legislature.

^-----It's a link...

Edited October 11, 2008 by Strix