Is the state of our economy due to the fact that people in power were able to manipulate deregulation? (Answers: 14) (Comments: 0)
I believe state of our economy is due to the fact that people in power in business and government were able to manipulate deregulation and leverage the stock market to their advantage. Once upon a time, all mortgages were 20% down, at a fixed interest rate. The people that bought houses could afford houses. People saved money for their down payments. They rarely walked-away from their 20% savings investment in their home. Then, deregulation came along. "Greed Is Good" was the mantra of the day. In order to stimulate the economic marketplace in the late 70's due to a recession, congress passed legislation to deregulate the commercial banking / Savings and Loan industries. Thus, the collapse a few years later in the early1980's of numerous S & L's, due to bad decision making on the part of greedy CEO's who had pushed the deregulation and choose to make bad investments to earn outrageous interest rates. These high-rate, high-risk loans to under-capitalized, high-risk people were made with the banks and S & L's depositors funds - people lost their retirement money, pension plans were wiped-out. But, prior to the Black Monday crash of October 1981 the corporate CEO's rewarded themselves outrageous compensation packages and golden parachutes... do you recall The Keating Scandal? Regulation's were tightened back up... but then in early 2001, the economy went south again... partly due to 9-11. So, to stimulate the marketplace, more deregulation... this time of the mortgage and energy industries. Energy deregulation came very quickly, with V.P. "Tricky Dick" Cheney having the first-ever closed-door, zero-oversight private meetings at the White House of Energy Company Executives to create policy to regulate... the Energy Industry? (think fox guarding hen house...). Too soon after came the spectacular energy industry failures... (remember Enron? Kenneth Lay was a personal FOB, "Friend of Bush" ) and the massive compensation packages awarded to the CEO's by themselves. Then, as in the early 1980's, regulation had to be re-instituted. The mortgage industry took off... everyone was happy... lots of money was made by most everyone... lenders, home owners, home builders, investors, wall street... but, no one in government had the foresight to look toward the inevitable over-correction, the "bursting-of-the-bubble" in the market... we were distracted by the wars in Iraq and Afghanistan... if you're not with us, then you're against us! A primer: Mortgage loans are "bundled" in sets (blocks) of billions of dollars of investments... which had always been traditionally considered as "safe" (remember the down payments that used to be made...?). Lenders then sell these blocks of bundled mortgage loans to large investors, primarily Fannie May and Freddie Mac, quasi "US government-backed agencies" (think the US Post Office, another quasi government agency, overseen by uncle Fed, but run as it's own "company"). This selling-off of the bundled loan packages freed-up the mortgage lenders to create new loans, because they had been "re-paid" when sold to Fannie May & Freddie Mac. When the loans being made were sound, the marketplace worked well... When deregulation or the mortgage industry in early 2002 happened, just about anyone that could fog a mirror and breathe at the same time could suddenly get a mortgage. Previous rules and reg's on lending went out the window. The more loans they made, the more fee's they could collect. Lenders made lots of money, meaning their companies made lots of profit. Wall Street invested heavily in these mortgage securities, which now were weighted-down with the shady, undocumented "B" and "C" grade-paper sub-prime loans. More loans, more fees... more loans, more money to loan out, which were based on these mortgage bundles now loaded with poor-performing loans. This fed the gluttony in America for more and more credit: credit cards, equity loans - borrow, borrow borrow!! The wall street CEO's rewarded themselves handsomely... their companies were making outrageous profits... before they eventually collapsed. I BLAME UNCLE FED FOR THIS MESS - AND I PARTICULARLY BLAME THE REPUBLICANS, who have such a need to deregulate industries to the extent that corporate greed takes-over and fiscal common-sense falls by the wayside. Just because they could deregulate doesn't mean they should have deregulated... when guidelines / rules / regulations go away, greed ALWAYS takes over... EVERY, SINGLE TIME!!!!!!!!!!!!!!! I've worked in Real Estate, Mortgage Banking and as an Escrow Closer for the past 20+ years... saw this disaster coming for the last 5 years... YOUR THOUGHTS?? P.S. - I didn't make the loans, I was an administrative staff-support person... I was personally sickened by the loans being made to the people I knew couldn't repay them... but I couldn't do a damn thing about it, except by getting-out of the industry (that was 4 years ago...).

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Did you see how wall street is pouting,and dropped 300 points? (Answers: 4) (Comments: 0)
wall street is getting what they deserve, this is the best thing for america, no more las vegas style investments of nothing, you wall street did not in invest in people, us. citizens,, you wall street invested in a dream of no reality, you invested in war, and the good life for day dreamers, and fat steaks, and war on the poor people of the world, did you use your education to help the under educated, the male right world of men, wall street, and the five year war that may have left a rotting taste in their mouths of more

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