Tuesday, September 15, 2009

A most lucid explanation

If I understand what he’s saying ..the current economic crises can be traced back to the Reagan Administration. In 1980 they deregulated the Savings and Loan industry ..which put the business of making home loans in the hands of amateurs. Then, in 1987 ..the Reagan Administration had to bail out the Savings and Loan industry when it collapsed under the weight of it’s own incompetence (and unbridled greed). The Federal government allowed the Savings and Loans to package questionable loans, and sell them as stocks ..or mortgage-backed securities. It was mortgage-backed securities that helped make the housing slump of 2006–2007 ..go global in 2008 ..and wipe out investment houses from Bear Stearns to Deutsche Industriebank

1 comment:

brad4d said...

so in CA. we need to repeal Prop.13, it is also source of 3/4 vote hijack of majority rules, this was an indulgence that new property (the Trust) must balance..