Originally Posted By: JetStar
Originally Posted By: Derid
The housing bubble was caused because the govt was underwriting hundreds of billions in bad loans via Freddia and Fannie, and HUD et al make it politically and regulatorily necessary to extend loans to bad borrowers. Gov't intervention made for many millions more buyers than there would have otherwise been, thus inflating housing prices. Govt backing of the bad loans let shady Wall St types repackage them as securities ( hey its a great investment, the gov't is backing it! ) and sell them.


You know I respect you Derid, but blaming Fannie and Freddie for Credit Default Swaps is just nuts!

Originally Posted By: Derid
For some reason , a lot of people do not like to look past the involvement of a few dirty capitalists. And yeah, in any society, even if the old Soviet Union, when gov't gave people a legal way to fleece people... there is ALWAYS someone willing to take up that task. Capitalism as a system is about competition and letting the free market set value.... which is what was NOT happening in regards to the housing market, hence its collapse. Look at Medicare and other gov't intervention, and you will see that Health care costs are absurdly high not because of enough govt involvement but because of too much.


I hate it when people bring up the Soviet Union. I am in no way a communist. How can you say that Police and law enforcement are not needed and protection is not a right. How about defense by a fire department for damage and first response to injury? Well as soon as they help you you are on your own in your opinion. That to me is cruel. If you are a legal citizen of this country, you should be safe and have health care.

Getting everyone covered will reduce costs. No more expensive emergency room health care that NOONE PAYS FOR thereby jacking up the price for the honest folks like me. Preventative medicine goes a long way.

How about enforcing immigration law and policy so I DON'T HAVE TO PAY FOR ILLEGAL ALIENS HEALTH AND EDUCATION!

You guys just don't make sense. I cant wait until you turn 65.


Credit default swaps would have worked actually, and were not allowed to take their course because the people underwriting the swaps were politically connected enough to keep from having to pay them. The thing that caused the panic, was that noone was certain just how deep the liabilities went, and who was holding them. There likely would have been a lot less uncertainty a week after the collapse, had default swaps been allowed to play themselves out, and anyone over-exposed allowed to fail.

Bernake certainly thought that Goldman Sachs and all his buddies among the Wall St elite were much too important to America to be allowed to fail, but that does not make it objective reality.


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Jet, I bring up the Soviets simply because they are an example of a managed economy. It is not meant to imply you are a Soviet.

Also, this discussion is about Federal duties. I do not think my fire dept should be run by a giant Fed bureaucracy.... I think my local fire dept does quite well thank you. No, I do not want it supplanted or controlled by an irresponsible and incompetent Federal Bureaucrat..

Last edited by Derid; 09/11/11 01:42 PM. Reason: cause
For who could be free when every other man's humour might domineer over him? - John Locke (2nd Treatise, sect 57)