AggieforPaul
01-24-2008, 07:09 PM
Market correction is only a small part of the problem. The real problem, as always is GOVERNMENT. Allow me to explain. Banks made some awful housing loans to people with no business trying to afford what they're buying. These people are called "sub prime borrowers", and the banks were fully aware of this. But they made these loans anyway because they were able to pawn off their liability through structured investment vehicles. They're basically selling the risk to someone else. The people who bit on these did so for 2 reasons:
1.) Some legitimately got fooled. The banks snuck a small amount of sub prime loans into packages filled with a lot of prime loans. This was done in order to keep their ratings artificially up. Without seriously breaking down these packages, it's easy to be fooled. But the ratings were misleading. A package with 4 great loans and 1 awful one is still not a great package
2.) I think a lot of people were willing to accept the risk knowing the government would be there to bail them out (and that they had the perfect excuse)
The liberal media is not telling the full story. They're framing this as just the banks preying on dumb home buyers, and the government heroically stepping in to stop the evil banks and help the common man. But its all bullshit. The government is AIDING AND ABETTING this predatory behavior with their bailouts.
Only in America can the government play accomplice to your home getting foreclosed, then write you freaking $600 check and come away looking like the good guy.
1.) Some legitimately got fooled. The banks snuck a small amount of sub prime loans into packages filled with a lot of prime loans. This was done in order to keep their ratings artificially up. Without seriously breaking down these packages, it's easy to be fooled. But the ratings were misleading. A package with 4 great loans and 1 awful one is still not a great package
2.) I think a lot of people were willing to accept the risk knowing the government would be there to bail them out (and that they had the perfect excuse)
The liberal media is not telling the full story. They're framing this as just the banks preying on dumb home buyers, and the government heroically stepping in to stop the evil banks and help the common man. But its all bullshit. The government is AIDING AND ABETTING this predatory behavior with their bailouts.
Only in America can the government play accomplice to your home getting foreclosed, then write you freaking $600 check and come away looking like the good guy.