Comments | 1144: The Subprime Mortgage Crisis, by Stephen Hicks

1144

The Subprime Mortgage Crisis, by Stephen Hicks

Sep 30, 2008 10:10

Initial situation (until 1980s):Lenders have profit motive ( Read more... )

Comments 29

browascension October 2 2008, 18:04:32 UTC

Maybe the Federal Reserve should be included in the flow chart. Central planning of interest rates doesn't sound like a good idea.

anonymous October 7 2008, 00:31:48 UTC

Poor people caused investment banks to securitize mortgages into complex investment vehicles with no real index for valuation? Who knew.

1144 October 7 2008, 02:58:56 UTC

It's true -- except that I already said that poor people didn't do it. The government did. I'm sorry none of your Leftist friends told you all about it already. Who knew ... they would be so remiss?

anonymous October 7 2008, 03:13:13 UTC

The government forced investment banks into over-leveraging themselves, by as much as 30-to-1? They forced CDO indexes to rely on a crude single-factor Gaussian default correlation? They caused the credit-derivatives market to grow to over $62 trillion by September of this year?

1144 October 7 2008, 03:36:20 UTC

So, what are you saying? That this must have been caused by normal market forces? If you have something to share, then enlighten your readership. Belittling vitriol is not a currency accepted here.

What part of the chart do you disagree with? Do you dispute the facts, or the effects of these laws and other actions by governmental agents? What effect did these mandates have on the behaviors of the lenders that sold to Fannie Mae and Freddie Mac? And what is your opinion of Fannie Mae and Freddie Mac as institutions?

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