What caused the financial crisis? The Republican Big Lie goes viral.

[ErikJ]

The Republicans are spreading the Big Lie that it was TOO MUCH GOVT REGULATION and the banks were innocent. They say the banks were FORCED to make loans to poor people (mostly people of color too)

"What caused the financial crisis? The Big Lie goes viral." Wash. Post

Why are people trying to rewrite the history of the crisis? Some are simply trying to save face. Interest groups who advocate for deregulation of the finance sector would prefer that deregulation not receive any blame for the crisis.

Some stand to profit from the status quo: Banks present a systemic risk to the economy, and reducing that risk by lowering their leverage and increasing capital requirements also lowers profitability. Others are hired guns, doing the bidding of bosses on Wall Street.
http://www.washingtonpost.com/business/what-caused-the-financial-crisis-the-big-lie-goes-viral/2011/10/31/gIQAXlSOqM_story_1.html

[banned from Kos]

1. Very good. Notice no Fannie/Freddie/CRA and no "massive fraud"

should be required reading for both sides.

Its fact based!

[arcane1]

2. The whole "Banks were forced" bs really pisses me off

and it's basically saying: the government required banks to give loans to minorities.

I work for a bank that had a total of ZERO sub-prime mortgages on its books. Avoiding that mess was one of the few business decisions I agreed with :)

[banned from Kos]

5. You are exactly right. PNC is a huge bank, #6 in the USA and they refused

to write any sub-prime. The CEO bragged about it on CNBC while the meltdown was raging in 2008.

[ErikJ]

6. Mine neither

My bank didnt make sub-primes either. LET ALONE LIAR SUBPRIMES! It says that it was NON-BANK mortgage originators that were making all the LIAR LOANS.
And it was the Big Five banks that bought these toxic mortgages from the LIAR LOAN Originators. In fact they were pleading them for more, as much as possible. They had lots of buyers for their toxic investments all over the world.


7. The demand for higher-yielding paper led Wall Street to begin bundling mortgages. The highest yielding were subprime mortgages.

This market was dominated by non-bank originators exempt from most regulations.
The Fed could have supervised them, but Greenspan did not.

8.These mortgage originators’ lend-to-sell-to-securitizers model had them holding mortgages for a very short period.
This allowed them to get creative with underwriting standards, abdicating traditional lending metrics such as income, credit rating, debt-service history and loan-to-value. (LIAR LOANS)

[lib2DaBone]

3. It had nothing to do with off shoring all the jobs to China...

.. so people couldn't pay their inflated mortgages.

Then selling worthless Derivatives based on these mortgages backed by Credit Default Swaps...

Selling this garbage all over the globe until the system finally collapsed under the weight of its own greed.

No.. this couldn't be the problem... :sarcasm:

[truebrit71]

4. I am seeing that bullshit meme more and more...

...trying to blame it on Clinton and Fannie Mae...

Yeah, they MADE the banks write bad mortgages, bundle them up with other debt, get the whole thing rated AAA by the crooked rating agencies and then sell them to pension funds that invested the nest eggs of hard-working middle and working class folks in what they KNEW was dogshit from day one...:eyes:

I understand why the rich defend the banks, but anyone that makes less than $250k a year and defends the banks from the heinous crimes they committed is a fucking moron..