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142802Re: [evol-psych] Re: Mitt Romney Explain How Jesus Will Reign for 1,000 Years When He Returns, in Jerusalem... and Missouri

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  • Phil Roberts, Jr.
    Nov 8, 2012
      clarence_sonny_williams wrote:
      > Phil,
      > You forget to take into account the Democrat-induced effort to provide
      > mortgages to previously unqualified people. Why should only the "rich"
      > live the American dream of a single-residency in a quiet suburb? That
      > appeals to the egalitarian principles driving Democrat politics, a
      > principle that takes primacy over individual earning and the resulting
      > disparities. Let's get everyone to share the American dream, and
      > government (via Fanny Mae et al) would pave the way...whether the
      > individual could afford it or not.

      Fannie Mae (and Freddie Mack) certainly played a role in the 2008-9
      collapse, but probably not in the straightforward manner a lot of
      folks think. I've watched close to a dozen documentaries on the
      collapse, and the one I found the most helpful was the CNBC DVD
      'House of Cards'. According to this particular documentary, the
      seeds were sown when Fannie Mae ran into management and accounting
      problems and was temporarily put out of business. At that point in
      time, Wall Street saw a vacuum and a golden opportunity to step
      in and fill the void. Up to this point, mortgages were still being
      done in a fairly responsible manner. But once Wall Street entered
      the picture, the profit motive became the driving force, along with
      lots of predatory lending ("the breath test") and in which things
      really got crazy. Only after this initial foray into recklessness,
      when Fannie Mae once again re-entered the market, and saw itself losing
      market share, did it also begin to adopt some of these same tactics
      simply to survive in a market that was now out of control.

      So a case could be made that the problems arose because of an attempt
      to privatize what was previously a fairly smooth running government
      operation, and with the resulting company taking advantage of its unfair
      position in the market (because of lingering IMPLICIT government
      guarantees) with lots of attendant corruption and greed and mismanagement.
      But as bad as it was, Fannie Mae was still being fairly
      responsible with respect to mortgages. It was only after it was
      put out of business for a while while Congress investigated "accounting
      discrepancies", and then RE-ENTERED a radically transformed
      market, that it too began to adopt some of these irresponsible lending
      practices simply to survive.

      Some of the other documentaries that I think are worth a watch (my
      eyesight is so bad that reading is no longer an option) are:

      The Warning
      Ten Trillion and Counting
      Inside Job
      Inside the Meltdown
      Money, Power and Wall Street
      Breaking the Bank

      > Wall Street then took advantage of this build-up of unqualified
      > house-owners and everything is fine...until house prices nudge down.
      > When that happens, the house of cards begun by egalitarian Democrats
      > falls down, quickly and with devastating results. Could regulations
      > preventing the sale of mortgage bundling trading instruments have
      > prevented the collapse? Possibly, but that still means you have
      > forgotten the REAL driver behind the financial debacle of 2008: Democrat
      > egalitarianism.

      Here is where we disagree, although I suspect things are murky enough
      for different interpretations. I think things started to go south
      when they attempted to privatize a government operation, but in which
      the break wasn't clean resulting in a privately held corporation with
      an unfair implicit government guarantee resulting in rampant mismanagement
      and corruption. But, in spite of this, lending was still fairly responsible.
      It was only AFTER Wall Street usurped the market position formerly held
      by Fannie Mae that lending practices became irresponsible.

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