Topic: Economics
What Went Wrong My thoughts on the credit crisis and a solution.by Joe W.
(libertarian)
Friday, December 12, 2008
What caused the credit crisis and why is it so crippling to our economy?
Well that's easy to answer.? In 2006, voters kicked out the Republican majority and usherd in an era of Democratic control and supposed change. However, the Democratic agenda was not one of change, but one of big government and an Orwellian vision. First, they changed laws, making it easier for people to get a home loan. That's all well and good, unfortunately the more restrictive rules were better for the economy. With the new laws, people of a less favorable credit rating were able to get a mortgage. Now, they have poor credit for a reason and what seemed to be an equalizer turned into the instrument of our economic demise. People defaulted, companies no longer had the money to finance other ventures, loans could no longer be guaranteed, and ultimately went bankrupt. The markets, relying on money from such companies, paniced and the markets dropped. Companies that usually rely on bank loans to stay afloat in bad times, such as the auto industry, could no longer go to Wall Street for aid, making the market spiral down even more.
What made the situation worse? Simple as day, Barack Obama. Now it's not because he's black, but his economic and social agenda. This man is Jimmy Carter reborn. Like it or not, but the days before Obama election, the economy when up a thousand points. The day after they dropped.
What's the solution? Simple, elect conservatives to Congress. Now, I didn't say Republicans but Conservatives; such as Pat Buchanan, Ron Paul, Paul Broun, Tom Tancredo, even to a minor extent Sarah Palin. Fiscal conservatives, economic & foreign policy nationalists, and Patriotic. When we put an America First message on our economic agenda, we will recover. Al Gore actually has it right when he says that a green economy will create jobs, it will but only if we stay out of foreign wars and kick China's tainted products out of our markets. Iran and Syria are bad news for Israel, but how are they our problem? Seriously we have to grow some balls, say f*** you and fix our own problems. Or maybe that's just me.
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Posted By: Walt Thiessen
Date: 2008-12-13 05:52:53
This article completely ignores six years of complete Republican control of the Congress and the White House (plus the last two years under Republican President Bush) during which the greatest overinvestment in real estate in history as well as the greatest increases in the budget deficit and the national debt in history took place and which led to this year's massive bailout. I don't doubt that the Democratic Liberals have played a major role in all this, but making it sound like Republican Conservatives played no role is simply wrong.
Also, there's a little thing called the Federal Reserve and its huge inflationary influences under Greenspan and now under Bernanke which has driven our economy into an inflationary pattern over two decades, leading up to the current highly deflationary environment and setting up a new inflation that is coming down the line due to an increase of more than 60% in the money supply as measured by bank reserves during the past three months.
Attempting to turn this crisis into a "blame the liberals" rant where they bear all the responsibility is itself irresponsible. There's plenty of blame to go around.
1. Pat Buchanan is anti-free trade protectionist. The only good praise he remotely deserves from Libertarians is his foreign policy. I saw him a few weeks ago on MSNBC and he was supporting the Big Three bailout, he in my opininon lost his fiscal conservative credibilty that moment in my eyes.
2. Tancredo couldnt make a blip in the primaries so its pretty safe to say that majority of Americans dont want the far right like Tancredo in power.
3. Palin has no interest in changing our foolish foreign policy (she favors getting in Russia's face) and she appeals the far right wing religious fringe sorry but no thanks.
I dont know who Broun is so I cant agree or disagree with you pick here but only people like Ron Paul can change the country around. Not big government conservatives like the other three.
Carter started the "community reinvestment act" back in the 70's. His concern was what he saw as banks "redlining" certain neighborhoods and minorities. Probably a somewhat legitmate concern. Few problems arose.
Clinton saw a way to gain strong support politically and he along with some of this present Obama cabinet group, forced lenders to make these sub-prime loans. The bankers were not going to willingly lose their money, so they bundled these risky loans and sold them to wall street as derivatives of GSE's.
Clinton then appointed two cronies, Franklin Raines and Jaymee Gorelick to head up Fannie and Freddie. Both left under fire, but with millions of $$$$. Fannie and Freddie bought up all and any home loan bundles they could find. At Clinton's bequest.
Wall street probably knew these loans were toxic, but these folks were getting rich with real $$ in pay and bonuses while putting the bad debt on paper as profits. Many of the financials saw these phony profits and big bonuses and wanted the same. Greed took over. Aig insured these loans (CDS's) with no money to back them. Their executives took their millions also, while letting the company's risks rise.
A small credit to Bush and company, they did try a couple of times to stop the rip off, but were blocked by the Democrats.
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