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Show me one bit of legislation that forced these banks to give loans out.
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[sarcasm]... and we know that the banks have no influence over Congress. They have no lobbyists; the make no campaign contributions, etc.[/sarcasm]
The reality, of course, is that if Congress passed a law that the banks objected they would feverishly fight that law. I don't remember any fight, do you?
Show me one bit of legislation that forced these banks to give loans out.
Actually, the government did force the banks to give loans out, to some small and insignificant degree. I don't have a problem with that claim, all by itself.
The trouble comes when they try and use this to explain the crisis. Regardless of whether you like these programs or not, the "forced loans" were insignificant, and not a cause of the financial crisis.
Bloomberg, of course, would never blame the banks for anything. His city lives and dies off Wall Street revenues.
The banks tell Congress what they want and Congress provides. The Bankers had to sell mortgages to everyone to keep the growth going. Congress merely changed to rules to expand the market.
Now the bankers do not want to take responsibility (avoiding responsibility is a whole semester in business school) for the consequences of getting what they wanted.
The banks tell Congress what they want and Congress provides. The Bankers had to sell mortgages to everyone to keep the growth going. Congress merely changed to rules to expand the market.
Now the bankers do not want to take responsibility (avoiding responsibility is a whole semester in business school) for the consequences of getting what they wanted.
Congress, by repealing Glass-Stegall, gave banks the out so that they would never have to be responsible. Thus we see the shift of toxic mortgage dirivitives to the savings arms of banks to be insured by depositors and the FDIC. The FDIC in return will fail and depositors will be left with empty pockets. This is a serious doomsday scenario which is very, very real.
You think it was bad when the investors of Solyndra were put ahead of the taxpayer? Well, how about the taxpayers being put on the hook, legally mind you, for all those toxic derivitives? Those toxic derivites of debt that exists on paper only is more than 5 time our national debt. Yet, the banks will walk and the taxpayers and anyone with a savings account will suffer.
So much for "no one under $250K income" being taxed. Currency destruction is the ultimate tax on the middle class.
I’m an investor focused on preserving capital and managing risk. I’m not out to win the next election or drive the debate. For those who are, facts and data matter much less than a narrative that supports their interests.
One group has been especially vocal about shaping a new narrative of the credit crisis and economic collapse: those whose bad judgment and failed philosophy helped cause the crisis.
Rather than admit the error of their ways — Repent! — these people are engaged in an active campaign to rewrite history. They are not, of course, exonerated in doing so. And beyond that, they damage the process of repairing what was broken. They muddy the waters when it comes to holding guilty parties responsible. They prevent measures from being put into place to prevent another crisis.
Here is the surprising takeaway: They are winning. Thanks to the endless repetition of the Big Lie.
A Big Lie is so colossal that no one would believe that someone could have the impudence to distort the truth so infamously.
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Wall Street has its own version: Its Big Lie is that banks and investment houses are merely victims of the crash. You see, the entire boom and bust was caused by misguided government policies. It was not irresponsible lending or derivative or excess leverage or misguided compensation packages, but rather long-standing housing policies that were at fault.
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The Big Lie made a surprise appearance Tuesday when New York Mayor Michael Bloomberg, responding to a question about Occupy Wall Street, stunned observers by exonerating Wall Street: “It was not the banks that created the mortgage crisis. It was, plain and simple, Congress who forced everybody to go and give mortgages to people who were on the cusp.”
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Bloomberg was partially correct: Congress did radically deregulate the financial sector, doing away with many of the protections that had worked for decades. Congress allowed Wall Street to self-regulate, and the Fed the turned a blind eye to bank abuses.
The previous Big Lie — the discredited belief that free markets require no adult supervision — is the reason people have created a new false narrative.
Now it’s time for the Big Truth.
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