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Oh, Alan….

October 23, 2008

From CNN

Greenspan said he made a mistake in presuming that lenders themselves were more capable than regulators of protecting their finances. He said he was “shocked” when that system “broke down.”

“I still do not understand exactly how it happened,” said Greenspan.

5 Comments leave one →
  1. October 23, 2008 10:56 am

    I believe that people who took out loans they could not afford should bare some responsibility for being stupid. But I still can’t understand why we should rescue banks instead of individual borrowers. Professional financial institutions are full of experts: people who are trained and paid to know what the hell they are doing. Individual borrowers do not have that kind of insight, so why are they (we) the ones paying to rescue the professionals? Mr. Greenspan, I know exactly what happened… we got screwed.

  2. David permalink
    October 23, 2008 12:34 pm

    It happened because the government via quazi-public entities Franny and Freddy artificially reduced risk indicators that would have signaled investors to punish the banks that were deeply invested in these securities. All the incentives from mortgage brokers, to banks, to people wanting homes bigger than they could afford, to state and local governments that enjoyed the tax revenue to regulators, to investors were to misbehave in the face of this bubble.

    And guess who else is at fault that doesn’t want to admit it? All those people who own homes who’s value skyrocketed because people were buying homes in their neighborhood they couldn’t afford.

    Enough blame to go around. Pretty much the only people who aren’t responsible are renters without investments in the stock market. The only good news for them is, nothing’s changed in their world… well, except they might lose their jobs in the recession.

    Everyone with money or power made out like a bandit for a while. Poor people got nothing, and only stand to lose in the coming economic turbulence.

  3. Cuz permalink
    October 24, 2008 11:29 pm

    Those of us that bought within our means, can afford our mortgages, make payments when we’re supposed to, and pay taxes are the ones that get punished for being financially responsible.

    Not giving home loans to people that can’t afford it is NOT discrimination, it’s THE RESPONSIBLE THING TO DO. And we don’t need federal statutes that say otherwise.

  4. Shane permalink
    October 27, 2008 9:36 am

    I can solve all this in one fell swoop.

    If we can execute people who are borderline retarded we can surely execute CEOs. Enact the death penalty for white collar crime and they’ll get their shit together.

  5. October 27, 2008 7:20 pm

    I’m not asking why it *did* happen, I’m asking why it *should* happen. No, actually I’m suggesting that it shouldn’t have happened. Instead, the government should have bought out individuals, not banks. Even stupid people who bought more home than they could afford are less to blame than the banks that said, “Sure! Here’s the money you obviously won’t be able to pay back.”

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