Welcome to the Socialist States of America.

Paulson and Bernanke are buddies with the guys going down the toilet.  The committee members that oversee this mess are directly responsible for it and on the take to boot.  Bush is a bleeding heart liberal(yes, he's a liberal, get over it, liberals expand government powers and nanny state programs, not conservatives) and can't bear to forclose on poor people that had no business buying houses in the first place.  The republicans have no balls, so they aren't likely to block it in the senate, where they actually can even if they know it's bullshit.  In the end, Fannie and Freddie will still be buying bad loans to people that can't afford them and super charging the housing bubble till the next collapse.  I don't see any calls to stop that practice.

We have no protection from what they're going to do, so go ahead and bend over because you're about to get fucked.

I've of course heard about it but I don't know much about global economies. I know no one really want s to bail out these companies and I'm not even sure which party initiated the idea, but i think it's a necessary evil at this point, the government cant just let these companies collapse without it hurting the economy even more.

Paying out all that money sucks, but I think it will be even worse for us taxpayers if they don't.

But I agree, I'll be even more pissed if I have to hear that one of those CEO's left with a 6 figure pension or bonus or something.

I think what irritates me is that this seemed (to me) to be what was *obviously* going to happen when the GOP was having photo-ops of themselves with the regulations and a chainsaw in the 90's.

I could just scream - Now McCain's commenting about how the problems were caused by 'Greedy Wall Street Speculators'.

"Umm, Senator McCain, with deepest respect, did anyone mention to you when you and Phil Gramm were deregulating everything in site . . . It's frickin' *WALL STREET* JACKASS!  They ask you when you get there "Are you a Greedy Speculator?" and if you say no, they don't *LET* you in! They made a frickin' *MOVIE* about it!"

If the GOP was designing buildings, they would insist that fire alarms, sprinkler systems, and fire escapes were wastes of money because nobody would set fire to a building they were in, that you shouldn't have any limitation on how many people were in the downstairs nightclub because if it got too crowded people wouldn't pay the door charge anyway, and when the building burned down five years later the architects would be outside screaming at the fire department that the building was *designed* to make sure careless people were burned alive!

Jonnan

That isn't entirely accurate.  The deregulation makes this scenario possible.  It does not however make it impossible to refuse buying a bad loan.  Being able to buy and sell loans allows for more risk yes, but without Fannie and Freddie being run in an insane manner for back door socialism, there would be no massive housing bubble right now.  With no one to sell the $200k mortage with zero down for a guy making $30k a year to, they wouldn't exist in anything approaching large numbers.

It is the politicians pushing the bad loans that have made it systemic instead of a fringe practice that occasionally sinks a company here and there.  We are paying the price of socialism, not deregulation.  Without that deregulation, they'd have just found another way to get Fannie and Freddie backing the bad loans and we'd still be on the hook for it.

On one level, this policy cycle is just a radical expansion of our existing US "socialism." It's a matter of degree. We've long had public ownership of major economic units ranging from the Hoover Dam, to the FAA, to AmTrak. We have different ways of describing things so we can feel nice and "American," but our economy has depended on public investment from the founding. Post Office ring any bells?

But there is also a disturbing level in which this change is very much qualitative, not simply quantitative. The sick trick here is that we are doing a very modern US version of nationalizing stuff--we're taking on *failed* businesses instead of profitable ones.

I'm afraid I believe that some sort of bailout is probably necessary, but like many other Democrats who long for a real left wing in this country, I'm feeling very Linda Blair-like on account of being able to listen to *Newt Gingrich* for several minutes at a time and not strongly disagree with him (alright, I admit some stand-alone sound bites could almost have come from me). I can recover a bit when I think about the irony of one of the folks who helped make this bed of festering dead meat condemning the moment's plan for cleaning it up, but, really, it mostly leaves my head spinning and my stomach close to weapons-grade pea soup spewing.

I won't even get started about the humble, still-mortgaged Florida condo that my sister and I inherited recently and are having *such fun* trying to sell.

That's fair enough if you limit your argument to the sub-prime market. But the problems are far broader than that--the sub-primes were just where folks started admitting that things were out of hand. Before this is over, we'll all know a lot more about how "sovereign funds" from around the world own part most US citizens' credit card debt. In between, we'll learn more about how easy credit, the house-flipping fad, and outright lust for "too much house" have driven ludicrous housing prices across the board.

Umm - I'm not sure how you mean that - before the deregulation, it *was* possible to refuse to buy a bad loan - the equity instruments that sliced and diced these bad mortgages into other securities is quite literally what caused this to go systemic, but the GOP *insisted* that these regulations were stifling the markets. Now the markets are paralyzed, afraid to deal with *any* equity instruments for fear it's polluted with these mortgages and will collapse before the ink is dry on the deal.

As for the bubble itself - well, bubbles happen, and i don't claim to be smart enough to know how to prevent them (although, historically, they seem to happen less when the keynes school is in charge than the Friedman/Chicago school. But that's just observation.), but again, the very sub-prime loans that caused the bubble to hyper-inflate were possible because of that deregulation.

So deregulation helped create the poison, and helped get it from one sector into the 'blood stream' (the equities markets). Not exactly an indictment of socialism.

Then there's Fannie may/Freddie Mac - two public independent agencies that were privatised at the *insistence* of the GOP "Anything you can do the market can do better" idealogues, and the private sector started, as they are wont to do, making sure they went after every red cent they could get. So they were in it up to there nose in this new, wonderful, deregulated market. So now we're socializing the risk after the idealogues privatised the profits.

That pain your feeling is the invisible hand of the market in places it wouldn't normally be if it weren't for deregulation - {G}.

Jonnan

My cousin killed himself nearly two years ago as a direct result of the deregulation situation we are in thanks to the republicans since Regan and his stupid "trickledown economics" epically failed theory. My cousin simply could not make his mortgage payments as well as his bills. This is so since he lost his job due to a downturn in the local economy where he lived and he could not find a new job and he could not qualify for any benefits so no help for him, his wife and his three daughters. The mortgage payments keep going up and he was hounded none stop after he maxed out his credit cards which also had ungodly interest rates that would make the mafia blush he simply gave up and decided his family would be better without him.   

This coupled with the fact his father who recently had a heartache at the wheel of his car resulting in a near tragic accident racked up several hundred thousand in hospital bills. Consequently he lost his ability to work and as an insult to injury he has basically lost everything he built up over the past 40 years of back breaking work to the insurance companies and hospital. What the hell is wrong with this country anymore?

There are people making millions a day for bullshit work hours and paying nearly nothing in taxes and average guys losing everything due to situations beyond their control. It is simply gut wrenching to say the least.

The republicans yell "let the market take care of itself" all the time, at least throughout my entire life and yet every time the market is poised to strip wealthy families of much of their assets there is always a "national interest" need argument proposed, at the public's expense that it is time the government step in and save industries (but without tight control attached). What about all the little guys who lost everything over the past several decades of this crazy wild west deregulation period?  Who will help them? Seems to me they are the ones that we have a national interest in protecting not these guys who make more in a week then most entire families will make in a couple generations.  

On a side note, I'm a firm believer in anything that is required by law needs to NOT be privately owned or controlled. There is simply an inherent conflict of interest that I can never get over when I think about such shit.

I've heard plenty of stories like that Spartan (including members of my own family) and it sucks major elephant dick.

I hope you don't want the people in power, the ones with the money and are in the position to fix the issue, to solve the problem? That's just too much to ask of those kind, kind people. [/sarcasm UP TEH BUTT]

Lets get some things straight before you got off the wall.

I do agree with this paragraph.  Its insane that the current methodology for high-end positions allow for people to screw a company over royally and get off scot free (usually even better off than before).  Based on your comments you're obviously one of those types who has never done any research into why it is that way (and there is a reason), so I'd encourage you to look into that.

I won't respond to the stories, suffice to say I suspect your cousin was like most American's in that situation, unable to adjust his standards of living to meet his new needs.  And for reference, I had similar situation happen to an Uncle and Aunt.  Uncle took a nose dive off a bike that decided to go from 60 to 0 in an instant and my Aunt couldn't get a job to take over the lack of his income as well as his medical bills.  Instead she sold (rented originally, sold it later on) their house, moved to Nowheresville Indiana where she could afford a cheap house on a cheap paycheck and slowly but surely nursed my Uncle back into as normal as he wasn going to be.

Also the de-regulation that caused some of the problems associated with the current crisis was not laid solely at the feet of the Republicans.  Hell, people are quick to point out that Clinton had no power to veto the GLB Act, but they conviently ignore the fact that Clinton personally (as well as his administration) made it possible for the Citigroup merger which brought about the GLB Act in the first place.  Not to mention the GLB Act was passed with an overwhelming majority in the House and Senate, which isn't even possible without strong support on both sides.

You make more money, you pay more taxes, that is how it works.  You may like to think otherwise, or argue against it, but that is how it works.  Now, I'm not so naive as to believe the rich don't do everything in their power to aovid paying taxes, but they will pay more than Middle/Lower-class do as long as they aren't breaking the law.

Get off the crack.  The "de-regulation" binge was only recent thanks to the GLB Act.  Banks and Finacial Instituations have long been regulated do (mostly) to the Glass-Steagall Act put forth during the Great Depression.  Yeah, the big GD, as in 1930s.  The GLB Act, which changed the status quo, only came into effect in the late 90s.  Besides, no matter how you look at it the little guy is protected by other programs that are still in place (such as the FDIC), as usually they sink or swim on their own stupidity.

How does this relate in any way to the current crisis?  There are numerous factors to blame, sure, but the primary factor (which no one will admit too, damn lack of personal responsibility in the present) is incredibly stupid people taking incredibly stupid loans.  You can argue that the GLB Act made it possible for banks to offer those loans, but that doesn't mean those idiots had to accept the loans.  And when those people started crashing, it caused the rest of the real estate market to dive which led to the current issue at hand.

Also, where in the world is it law to give out a mortgage?

Can i just ask you where did you post that comment from? Are you on Ju.com, Wincustomize.com, SOASE..etc....??

Thankyou.

Yay, I get to prove how much of a heartless dick I am...

Your cousin got a variable rate mortgage.  Your cousin racked up credit card debt.  Your cousin didn't sell his house when he could no longer afford it.  Your cousin lived outside his means.  Perhaps he understood that his own actions were the cause, not the brightest reaction to an epiphany, but I'll give him the benefit of the doubt.

When everyone is screaming about the economy being in the toilet, I still see hiring signs left and right.  If you can't keep the place you're in, you sell it and get something you can afford.  You don't wait around trying to find another job that will let you keep it.  You get what you can and live within your means.  If it's a job at McDonalds, it's still a job.

His father is a different issue, but it still boils down to self responsibility.  If he had insurance, there shouldn't have been hundreds of thousands of dollars in hospital bills.  That's why you get insurance, to cover those catastrophic costs.  Idiots that get 80/20 insurance that pays 80% of everything from the first dollar are idiots.  Idiots that get even worse insurance deals are even bigger idiots.  If he had an intelligent insurance plan, he wouldn't have any sizable bills, just his deductable.

Sob stories of relatives harmed by their own choices are just that, sob stories of relatives harmed by their own choices.  I prefer to live in a society where I can control my own life, than in one where I don't have the option.  It's not someone elses responsibility when your being an idiot causes you harm.  Shit happens, deal with it.

Jonnan, you like reading right?  Try this.

The Gramm-Leach-Bliley Act did not have any bearing on Fannie and Freddie, they were already exempt from the ban on bundling mortgages into securities.  That's their purpose, to take risky mortgages the banks aren't ordinarily dumb enough to make, bundle them, and then sell them as guaranteed securities.  Banks stopped buying the other securities over a year ago when it was obvious that the housing bubble was about to pop.  They got sucker punched anyway because Fannie and Freddie have been lying about their mortgages and they aren't nearly as solvent as they're supposed to have been.  The guarantees aren't real.

The boom in subprime mortgages has been blamed on the repeal, but the real reason is Fannie and Freddie are the ones that back nearly all of them.  Subprime mortgages increased from about fifty billion dollars to 150 billion dollars from 1997 to 1998.  The percentage share of the market was a change from about one percent to ten percent, a very dangerous level.  The Gramm-Leach-Bliley Act wasn't passed until November of 1999, a full year late to be causal.  Clinton's insane housing initiatives are the true culprit, and we can blame Bush and Congress for not stopping them eight years ago when the idiot left office.

I consider blaming future conditions for a change to be dishonest, but I'm one of those crazy right wingers.

Edit:  Er... odd question, but I'm posting from sins, why?

Damn it, that ruined my whole night. Psychoak posted something I completely agree with.

Side note: can one of the moderators fix reply #8? It's breaking the page in IE.

Thankyou, F-Bombs are often edited out by the Mods and i was just curious as to where you were posting from. I am compiling a list of sites within Stardockia that more readily allow such language, that way when i loose a few bombs off myself i can at least make sure it's on a site that doesnt mind too much...Even though any post can be viewed from just about anywhere in the tangled SD web.

Sorry to disappoint you Willy.  No, I'm not a fucking communist that hates corporations and thinks everything should be free.

Neilo, I'm pretty sure my F-Bombs, and plenty of other infractions, are a no no, and that Stardock should have banned me somewhere around my first post.  I have no idea why I'm still here.