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The Problem, in a Nutshell
Posted by: Dale Franks on Monday, October 06, 2008

Australian writer Jane Albrechtsen lays it out, simply and bluntly.
America has a long and undistinguished history of populist politicians stacking the cards against lenders and in favor of risky homeownership. Proving that good intentions are no guarantee of good policy, President Jimmy Carter's 1977 Community Reinvestment Act, which required banks to make loans to low-income people, was just another legislative leg-up for high-risk borrowers. If socially laudable but economically reckless laws cause entirely predictable problems for lenders, don't be surprised if taxpayers have to bail them out.

The final proof that American social policies have made mortgage lending an unviable industry rests with Fannie Mae and Freddie Mac. If sensible business people don't get into the mortgage industry because it is fundamentally a bad business, the American way has been to send in a couple of quasi-government agencies to fill the gap.

Fannie and Freddie dominated the mortgage industry because ultimately government was prepared to fund activities that prudent lenders would not. When their implicit government guarantee became explicit, America's system of government-directed lending on socially desirable, but commercially imprudent, lending stood exposed.
Whatever else we may say about "greed" or "deregulation", she captures the essence of the problem...which no one is interested in addressing.
 
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Previous Comments to this Post 

Comments
I don’t know what it’s going to take to rescue this point from the socialists and make sure that it goes down properly in history, but that’s all that’s left now.
 
Written By: Billy Beck
URL: http://www.two—four.net/weblog.php
It really does look as if the leftist plans for america are going to turn out very badly for americans. Destroying the US economy would achieve all that international leftists have sought for almost a hundred years. No one expected that Obama would be the one to pull the final trigger, but there it is.
 
Written By: Jonathan Cranston
URL: http://dailykos.com
We poor folks have a right to a free house.

Plus: Blowing up your girlfriend, and trying to blow up peace officers and their dates: The Mainstream.

And the old white guy once sat on a board, with a guy, whose girlfriend was once on a movie...with Kevin Bacon. And Kevin Bacon is a racist. Old white guy = right-wing anti-regulatory racist.
 
Written By: Reality Unchecked
URL: http://
VerticalBlu Film Company’s latest short film "I’m Voting Democrat" arrives just in time for this years 2008 Presidential Election. A response to another AZ local film company’s "I’m Voting Republican", VerticalBlu proves that all is fair in politics.

This year’s election is one of the most important elections of our times and it is up to each independent voter to become informed about the issues and stances on both sides of the presidential ticket.


http://www.youtube.com/watch?v=LPG25Wf0aa4

Thank you!

Daniel Gourley

VerticalBlu Film Company
www.verticalblu.com
 
Written By: Daniel Gourley
URL: http://www.verticalblu.com
So Daniel, How much money did Soros paid you to bend over?
 
Written By: capt joe
URL: http://
So Daniel, How much money did Soros paid you to bend over?
So I take it you haven’t watched the movie Joe? It’s not what you think and you might want to reconsider that comment. (And it’s pretty funny to boot.)
 
Written By: Marco
URL: http://
I don’t know what it’s going to take to rescue this point from the socialists and make sure that it goes down properly in history, but that’s all that’s left now.
Unfortunately, the same people who have convinced everyone that capitalism caused the Great Depression are the same ones re-writing history now.
 
Written By: Marco
URL: http://
It doesn’t matter what anyone says. Bush bad. Economy Bad. It is Bush’s fault. It is capitalism’s fault. Therefore we need more democrats and more socialism to prevent this from happening again. This is how the history books will be written.

Obama will win as the economy bottoms out, and the subsequent recovery will be attributed to his lightworking. Get used to it. Biden can stand in front of millions of Americans and say that the Democrats tried to stop irresponsible lending but the Republicans blocked it, and the media will not question that assertion.

Give up. There is no such thing as objective truth anymore. Go to sleep. Allow the government to take over. Become one of us. It is painless. Peace is the absence of opposition to socialism.
 
Written By: Jimmy the Dhimmi
URL: http://
So I take it you haven’t watched the movie Joe?

No I didn’t but if wrong then mea culpa. I just did not want to click through and eat someone’s finely made crap sandwich :)

 
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