Please, Sup Forums. No bias, no bullshit.
Redpill me on the 2008 subprime mortgage crisis in the US.
There were many layers to this problem: banks, regulation agencies, the government, the Fed, etc.
Clearly the issue is complicated, but what groups are responsible and what led them to do this?
Greed is the main motivator, of course, but this level of economic destruction is unprecedented in our lifetimes.
What were the other reasons? What else was going on?
Other urls found in this thread:
youtube.com
nytimes.com
content.time.com
fidererongses.com
twitter.com
George Bush: we want everybody in America to own their own home. That's what we want.
youtube.com
Bush drive for home ownership fueled housing bubble
nytimes.com
Republicans always crash the economy. Case closed.
Steve Sailer argues that the Bush Administration pushed for less stringent mortgage requirements for Black and Hispanic home-owners, which the financial industry tried to turn shit mortgages into good investments with financial wizardry.
SJWs argues that high denials of loans to Blacks and Hispanics are due to What Male Racism, and not an observable pattern that they are more financially irresponsible (see the economies of Latin America and Africa for proof) and less future time oriented (see their family lives) and thus more likely to default.
It wasn't just the banks lowering the standards for qualifications to take out a mortgage. It was those same banks "betting" on those mortgages to default and leveraging 40x their market capitalization.
>Bush
Here we go again with this cuck Leaf
>President Clinton's tenure was characterized by economic prosperity and financial deregulation, which in many ways set the stage for the excesses of recent years. Among his biggest strokes of free-wheeling capitalism was the Gramm-Leach-Bliley Act, which repealed the Glass-Steagall Act, a cornerstone of Depression-era regulation. He also signed the Commodity Futures Modernization Act, which exempted credit-default swaps from regulation. In 1995 Clinton loosened housing rules by rewriting the Community Reinvestment Act, which put added pressure on banks to lend in low-income neighborhoods. It is the subject of heated political and scholarly debate whether any of these moves are to blame for our troubles, but they certainly played a role in creating a permissive lending environment.
content.time.com
Low interest loans from the fed started the whole situation. Good thing we still are giving those through QE
George Bush: we want everybody in America to own their own home. That's what we want.
youtube.com
Did you even play this video? Did you even hear what he said?
Giving hispanics and blacks more home loans was a key part of Bush's economic plan.
Clinton left Bush one of the best economies in American history. 3.9% unemployment, a thriving economy, a $315 BILLION annual budget surplus, the national debt set to be paid off within 10 years, the highest labor participation rate in American history, and no wars.
Within 8 years, George Bush and the Republicans left America on its knees.
This is why Republicans can't be trusted with the economy. No matter how good a situation they inherit, they'll fuck it all up and blame Democrats.
Watch 'Inside Job'.
You'll want to break stuff afterwards, though, so be warned.
Just ignore all the shit Clinton, fucking Leaf
fannie and freddie, both corrupt government run enterprises, collapsed. They caused the crash.
Republicans have been trying to reform these corrupt mortage giants for decades, but democrats stone-walled. Fan and fred spawned a huge industry of sub prime mortgages and reckless lending. democrats sued banks for not lending to poor people as well.
>Just ignore all the shit Clinton, fucking Leaf
It's bipartisan bullshit, like a lot of things in America.
Well to all Democrats and that fucking Leaf, it's all Bush's fault
/thread
Clinton revamped the community reinvestment act which made fannie mae a quasi government arm that gave loans out on the false pretenses of racism.
Fannie mae gave so many loans to people who couldn't afford it or demonstrate a consistent credit that by 2006, over half of the loans given out were considered not likely to be paid back.
I forget the actual term for such a person.
Plus the federal reserve was just handing out money so you can put to and two together.
>hyper inflation
GS repeal, CRA, fannie mae and freddie mac, "homeownership society", low interest rates
all these things made it worse. it's retarded to peg it on one president.
I don't think there is a term for the person, but they were handing out not just one but billions(?) of dollars worth of sub prime loans which is really the only issue
Ninja loans
>I forget the actual term for such a person.
"High-risk borrower"
They knew they were risky. The difference is the loans only started flowing when the Gov't told them that it was free money because they'd be covered by reimbursement for what couldn't be paid back. They then took those high-risk loans, and then made high-risk investments and financial decisions with them.
This created the housing bubble that popped 06-08. This kind of subsidization is also the driving force behind the rising costs of education, and healthcare & insurance, the former of which is arguably another bubble reaching the end of its lifespan.
What happened is mortgage backed securities imploded. Those MBS were private label MBS. In fact, some of those MBS were designed to fail. Mostly CDOs wiped out. Here is a link with more quantitative approach.
fidererongses.com
But generally, the CDOs allowed to hide all the details about the loans, and the banks could sell any loan and pretty much any crap in the CDO. Some imploded CDOs weren't even mortgage CDOs.
Imagine you are a bond trader at a bank. You have some good positions and some bad positions. Good positions you can sell. Bad ones you can't. So what do you do? You sell crap you can't sell to a CDO based entirely on its credit rating. So you have a bad bond that has a high rating, but nobody would buy it at the price the rating implies. You sell it to a CDO at whatever the rating implied. CDOs were big dumpsters for Wall St. Then they found out they can sell anything into a CDO and then the market absolutely crashed. Mostly the CDOs were composed of mortgage bonds and loans simply because there were many of those.
The answer is niggers and hispanics acted like niggers and spics with their money.
I would love another market crash to happen but this time I have stake in the game with my 401k
Neocons are just Democrats that like Israel, but nice try
I'll make it simple. Hispanic immigrants and other lower class groups (white trash, niggers) caused the crisis by getting mortgages they could never afford. These shitskins were enabled by liberal policies designed to massively increase home ownership among the poor. The mortgages were worthless but wall street repackaged them, thinking that financial maths could remove all risks.
It was mostly investment properties that went into strategic defaults. The idiots didn't know how to take 5 option ARMS and try to flip them, and then default when market dipped. Look at the numbers, not on the feel good story. The numbers imply that it was relatively wealthy population gambled on the flipping homes, and Wall St enabled them by buying any mortgage, because they could sell them to mostly foreign investors. Wall St got fucked because they started to drink their own cool aid, and house flippers walked away from no money down purchases with barely a dent. Now their credits are cured and they could do the same shit again. Nogs are simply unable to do what you are accusing them of. They would rather buy $500 sneakers.
Going to get your wish this year. We're due.
Watch the Inside Job movie
20 trillion in debt and interest rates riding the bottom of the barrel for 8 years, we are still in the recession it just took a breather
read the big short
long story short; the entire system was at least partially corrupted from top to bottom, both public and private; when prices quit rising, the music stopped