More Articles

[unforth]

I may not have time to finish my last post, unfortunately, but here are some other articles that I found interesting:
Why the Bailout was a Terrible Idea, according to the Nation.
Bailout Causing International Problems
Newsweek Gives an Overview of the Crisis - this was quite helpful, despite the fact that I was dubious of a few of the things that it said.
So What is a Credit Default Swap, Anyway? - another Newsweek article with some good overview type information.
Timeline of Events Since 2007 - the dow, aligned with a few news tidbits, but still vaguely interesting.
The Times Gives an Overview of Events Since Yesterday, but you might not be able to read without making an account - they're free, though, so I'd say it's worth it.
Yay, Bipartisan politics? "Mr. Boehner...said he could not remember a time when the muscle of both parties and the White House failed to produce a victory." (from the above article)

What's really starting to bug me is the way that everyone is blaming "Wall Street Recklessness." That is not what's caused this mess. The root of this mess is people who had poor credit being extended large lines of credit at high risk - credit they should NEVER have received because they couldn't afford to pay it back. The banks just did what they had to in order defer that risk - but they gave the people what they wanted. Blaming Wall Street over looks the part where there would not have BEEN subprime mortgages if the demand for them hadn't been astronomical.

Gotta go. Probably more later.

Comments

[unforth.livejournal.com]

As I wrote in response to mindstalk, I think that there is plenty of blame to go around. That said, the deregulation that lead to easier credit in the 80s and 90s is clearly a major part of the picture. But it wasn't only those people who wanted a quick profit. American's have consistently made choices that drove them into debt. Yes, many of these people didn't have a choice. But many of them did, and just decided to live beyond their means anyway.

Gah, I feel like I'm spending half these comments playing devils advocate.

Really, that rant in my post was directed at the articles I've been reading, where sound bites from politicians use the words "Wall Street Recklessness" like a mantra. It pisses me off, because like in some many other instances, it's passes the buck, lays the blame on an already disliked small population, and excuses the actions of every other part of this equation, because obviously, the politicians, the small town banks, the mortgage brokers, the credit card issuers, the car dealers, the American people, and everyone else who also did things that they shouldn't have were hoodwinked by those evil, greedy bastards from Wall Street. It's just a simple, elegant model, that COMPLETELY IGNORES that placing blame won't solve the problem, and that we need to be looking rationally at what needs to be changed. What do we REALLY need to regulate in order to help? Who, if anyone, should be punished? What realistic strategies can be employed - both at the level of the nation and the world and at the level of the regular Joe who just doesn't want to lose his life savings - in order to combat this collapse?

But I'll acknowledge that my little rant did leave out a lot of the details of why I was actually making it. ;)

[swan-tower.livejournal.com]

I finally put my finger on what bugs me about the notion of placing a portion of blame on the people who took out the sub-prime mortgages: though on a lesser scale, it feels to me kind of like saying, well, drug dealers just sell people what they want.

It isn't as bad as all that, of course -- but my impression is that the mortgage lenders sought out people who in the normal way of things would not have been offered mortgages and snowed them under with financial-ese that nobody not in the industry or doing a lot of homework in their spare time could be expected to understand, suckering these people into signing agreements that they never should have touched. Seriously, the number of stories I've heard about predatory clauses in the fine print is astronomical. They basically said, "hey, you've always been told that you don't have enough money to buy a house -- but now you do!" Only you don't, and eventually it comes back to bite you on the ass.

This is more or less the same process that resulted in America being drowned under a tidal wave of junk mail saying you've been pre-approved for a credit card. I forget what change in situation led to that happening, but there was one, and suddenly credit card companies were soliciting people (like college students) with no kind of reliable income and encouraging them to buy everything on credit.

It's predatory. And I don't blame the prey for being caught.

You're right that "Wall Street" becomes a convenient but potentially misleading shorthand, because yes, the problem goes way beyond the few people that actually refers to. But I really don't see blaming the people who took out the mortgages, unless they did so in the full awareness that they wouldn't be able to pay them back. Which, except in a very few cases, they did not.