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  #1  
Old 10-07-2008, 08:58 PM
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Default The Mind and the Market

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  #2  
Old 10-07-2008, 11:32 PM
BeachFrontView BeachFrontView is offline
 
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Default Re: The Mind and the Market

Great diavlog. The more economists that can come on bloggingheads and explain whats going on the global economy the better. One thing I feel convinced of that is somewhat unsettling is that the people in charge don't even really know what is going on.
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  #3  
Old 10-08-2008, 12:29 AM
gwlaw99 gwlaw99 is offline
 
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Default Re: The Mind and the Market

It's interesting that people focus solely on the way the loans were securitized and not why the loans were made in the first place. If the loans were never made to people who could not afford them, this would not have happened.

Why were the loans made? Because in the 90s the Clinton Administration raised the amount of sub-prime loans that Fanny and Freddy could buy to 50% of their capitalization--a trillion dollars. Banks knowing that Fanny and Freddie would buy these risky loans were free to make sub-prime loans with little risk. This was exactly the problem McCain tried to solve in 2005 which was defeated by a party line vote of democrats.

So why did Clinton decide to make this change? It was mostly intense lobbying from community organization groups like ACORN (a group Obama worked closely with for many years and whose president he was very close to) who sued banks and called a racist anyone who wouldn't make sub-prime loans.


I will grant that ACORN and Obama had good motives in trying to make housing affordable to low income familes, but as we can obviously see now, that extremely poor judgement led to financial disaster.

Last edited by gwlaw99; 10-08-2008 at 12:45 AM..
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  #4  
Old 10-08-2008, 12:46 AM
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Default Re: The Mind and the Market

This issue has been discussed at length in recent threads.

In brief: there's a lot of fantasy mixed in with anecdotal stories about lending to "unqualified minorities" and also about customer in higher income brackets speculating with the expected "eternal" increase in real estate value and borrowing above their heads. Again, a lot of anecdotes and all kinds of agendas.

But the bottom line and real issue to be addressed is that the banking industry and mortgage brokers engaged in all kinds of deceptive practices to obtain customers. The deceptive practices were in part due to extremely lax regulation and to plain fraudulent practices and unethical tactics. The burden of responsibility lies in the lending institutions and governmental lack of regulations. It's similar to the case of the "extremely" small print. The real deal is hidden from the average person's view.

Everything else that followed in terms of transfer/ selling the loans, only made the problem more complicated. And more difficult to track by adding layers over layers of speculation.
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  #5  
Old 10-08-2008, 11:43 PM
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Default Re: The Mind and the Market

[QUOTE=Ocean;93515]
But the bottom line and real issue to be addressed is that the banking industry and mortgage brokers engaged in all kinds of deceptive practices to obtain customers. The deceptive practices were in part due to extremely lax regulation and to plain fraudulent practices and unethical tactics. The burden of responsibility lies in the lending institutions and governmental lack of regulations. It's similar to the case of the "extremely" small print. The real deal is hidden from the average person's view.
QUOTE]

There clearly was some fraudulent mortgage brokering going on. Thankfully there are fraud laws in all states that can be invoked to attempt to rectify these frauds. But I don't think true fraud was the biggest problem. Bigger was the speculative nature of too many mortgages. I know many folks have some ideas of who a speculator is and isn't, but I'd suggest simply that a speculator was anyone who engaged in a transaction where the presumed asset appreciation was critical to making it work. The guy with 7 condos in Naples, FL who wanted to flip 6 and payoff the last and put a boat in the marina on the profits was pretty obviously speculating. But so was the nice family who bought in Riverside, CA with a 30-month ARM with the expectation that the predicted appreciation would allow them to re-finance into an more affordable loan based on having sizeable equity. And lots of folks were convinced by real estate agents and mortgage brokers that it would work out and are suffering for that. In the most cases that convincing wasn't fraud. That they were convinced their speculation would probably work doesn't change the speculative nature of the transaction....had it worked perfectly it just would have been one more successful speculation in real estate. So when I hear folks asking for taxpayer assitance to people under threat of foreclosure, but quickly saying that we shouldn't extend it to speculators, I'm not sure why we should do it at all since it is going to leave so many folks out of the program.
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  #6  
Old 10-09-2008, 12:20 AM
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Default Re: The Mind and the Market

Again, there are many cases of individual borrowers speculating. And there's probably many more borrowers that had very little understanding about what they were getting themselves into. Some people may have thought of this as a once in a time opportunity to buy a house and relied on increased income in the near future, or underestimated other expenses typical of home ownership, or they could have been people that lost jobs. There are many possibilities. But there is an inherent recognition that the borrower may not be the best assessor of his/her own borrowing power. That's why in traditional mortgage transactions there has to be a loan approval process that takes into account multiple factors. And that's the reason why this industry has to be regulated. When you put together deregulation, unethical deceiving brokerage practices and eager to buy borrowers in an overinflated real estate market, there's a recipe for disaster. You can't really identify one by one the speculators from the poorly informed borrowers. The brokers got rid of the loans as soon as they were established. Loans were passed on and speculated on by big money financial institutions. Everybody acted unscrupulously by taking very high risk. So how would one go about fixing the problem?

I don't think there is a satisfactory answer. However, in my opinion the lenders and intermediaries have the burden of responsibility because they have the most information available and the resources to "know better". Financial institutions cannot be allowed to act irresponsibly.

And after all, what's the alternative one way or the other? Let the world economy crumble down and we all go down with it? Whether we like it or not, I don't think there are too many options.
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  #7  
Old 10-08-2008, 10:26 AM
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Default Re: The Mind and the Market

Quote:
Originally Posted by gwlaw99 View Post
I will grant that ACORN and Obama had good motives in trying to make housing affordable to low income familes, but as we can obviously see now, that extremely poor judgement led to financial disaster.
Ha ha ha! Choice rhetoric there, falsely intimating that you sympathize with these do-gooder intentions as a means of implying that Obama--seriously?!? Obama?!?--shares blame for the financial meltdown.

Fortunately, I am here to head your bullshit off at the pass. The influence of Fannie and Freddie simply isn't big enough to account for the scale of our current troubles. The same goes for the Community Reinvestment Act (c'm'on: you want to say it). Another way to think about it is that there aren't enough brown-skinned (but good-hearted and well-intentioned, I know you'd agree!) people holding bad mortgages to have caused the crisis. Bummer, dude!

Ah well. There's no help for your kind, but here's a link to an argument and several more links that thoroughly debunk the "blame government coddling of minorities" routine.
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  #8  
Old 10-08-2008, 11:30 AM
bjkeefe bjkeefe is offline
 
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Default Re: The Mind and the Market

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Originally Posted by Ray View Post
Ha ha ha! ... a means of implying that Obama--seriously?!? Obama?!?--shares blame for the financial meltdown.
Indeed. I wish the Right would get their talking points straight. One moment, it's "Obama is inexperienced, naive, completely without any executive track record -- pffft, community organizer" and the next it's "Obama is the mastermind who engineered the global economic collapse."
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  #9  
Old 10-08-2008, 01:19 PM
gwlaw99 gwlaw99 is offline
 
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Default Re: The Mind and the Market

Power is not the same thing as experience. Under your logic, George Bush, as president of the United States, is the most experienced man in the world. Obama made stupid mistakes funding ACORN when he was at the Chicago's Woods Fund. If anything the way Obama wielded power, by giving money to a group that had a major part in ruing the economy, shows he lacks the experience to make sound economic judgments.

While McCain, recognizing that changes made due to ACORN's lobbying could lead to disaster, tried to reform Fanny and Freddie in 2005. His bill was defeated by a party line vote of Democrats (including Obama) who would rather pander to their constituents by making loans available to people who shouldn't get them, than make sound economic judgments.

Last edited by gwlaw99; 10-08-2008 at 01:23 PM..
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  #10  
Old 10-08-2008, 01:27 PM
AemJeff AemJeff is offline
 
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Default Re: The Mind and the Market

Quote:
Originally Posted by gwlaw99 View Post
Power is not the same thing as experience. Under your logic, George Bush, as president of the United States, is the most experienced man in the world. Obama made stupid mistakes funding ACORN when he was at the Chicago's Woods Fund. If anything the way Obama wielded power, by giving money to a group that had a major part in ruing the economy, shows he lacks the experience to make sound economic judgments.

While McCain, recognizing that changes made due to ACORN's lobbying could lead to disaster, tried to reform Fanny and Freddie in 2005. His bill was defeated by a party line vote of Democrats (including Obama) who would rather pander to their constituents by making loans available to people who shouldn't get them, than make sound economic judgments.
Are you really saying that ACORN is responsible for the current mess? I'd love to see someone try to demonstrate the validity of that assertion.
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  #11  
Old 10-08-2008, 01:30 PM
gwlaw99 gwlaw99 is offline
 
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Default Re: The Mind and the Market

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Are you really saying that ACORN is responsible for the current mess? I'd love to see someone try to demonstrate the validity of that assertion.
Not the entire mess, but a large portion of it.

http://article.nationalreview.com/?q...MxMmNhZWQ1MTA=

By the way, ACORN does other great things like promote voter fraud.

http://news.google.com/?ncl=1255205671&hl=en&topic=n

Last edited by gwlaw99; 10-08-2008 at 01:35 PM..
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  #12  
Old 10-08-2008, 01:35 PM
TwinSwords TwinSwords is offline
 
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Default Re: The Mind and the Market

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Originally Posted by gwlaw99 View Post
Not the entire mess, but a large portion of it.

http://article.nationalreview.com/?q...MxMmNhZWQ1MTA=
Funny how most people never heard of ACORN two weeks ago but now are absolutely certain that it's the "large portion" of the reason for the collapse of the economy, because that's what they were told to believe at The Corner.
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  #13  
Old 10-08-2008, 01:38 PM
gwlaw99 gwlaw99 is offline
 
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Default Re: The Mind and the Market

Why don't you read the article and try to refute the arguments in it instead of blustering.
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  #14  
Old 10-08-2008, 01:42 PM
AemJeff AemJeff is offline
 
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Default Re: The Mind and the Market

Quote:
Originally Posted by gwlaw99 View Post
Not the entire mess, but a large portion of it.

http://article.nationalreview.com/?q...MxMmNhZWQ1MTA=

By the way, ACORN does other great things like promote voter fraud.

http://news.google.com/?ncl=1255205671&hl=en&topic=n
Kurtz's case is political, most of his economic assertions are partisan.

Example:
Quote:
ACORN’s efforts to undermine credit standards in the late 1980s taught it a valuable lesson.
Undermine? I doubt they'd characterize it that way. How could he possibly understand what "lessons" they were learing, or even be so positive about what they consider to be strategically important? Random Cornerites, generally, are a bad source if you're looking to support a factual case.
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  #15  
Old 10-08-2008, 01:44 PM
gwlaw99 gwlaw99 is offline
 
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Default Re: The Mind and the Market

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Originally Posted by AemJeff View Post
Kurtz's case is political, most of his economic assertions are partisan.

Example:


Undermine? I doubt they'd characterize it that way. How could he possibly understand what "lessons" they were learing, or even be so positive about what they consider to be strategically important? Random Cornerites, generally, are a bad source if you're looking to support a factual case.
Again, you make absolutely no reutations to the points in the article. You just make ad hominem attacks on NRO. Is that really the best you can do?
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  #16  
Old 10-08-2008, 01:47 PM
bjkeefe bjkeefe is offline
 
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Default Re: The Mind and the Market

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Originally Posted by gwlaw99 View Post
You just make ad hominem attacks on NRO. Is that really the best you can do?
Is that really the best you can do? To say "ad hominem" when you offer up a source that others don't consider reputable?

These two words are becoming the most hackneyed phrase online.
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  #17  
Old 10-08-2008, 01:51 PM
gwlaw99 gwlaw99 is offline
 
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Sorry, but whether you agree with their politics or not National Review is respected publication. If you cited the Nation or Mother Jones, I would not dismiss your argument simply because it was written in a far left publication.

If you don't want to say anything substantive that's your prerogative. Given your normal thoughtful contributions to this board, I'm disappointed.
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  #18  
Old 10-08-2008, 01:56 PM
TwinSwords TwinSwords is offline
 
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Default Re: The Mind and the Market

Quote:
Originally Posted by gwlaw99 View Post
Sorry, but whether you agree with their politics or not National Review is respected publication. If you cited the Nation or Mother Jones, I would not dismiss your argument simply because it was written in a far left publication.

If you don't want to say anything substantive that's your prerogative. Given your normal thoughtful contributions to this board, I'm disappointed.
Are you advancing an argument in your own words? No. Are you "saying anyting substantive"? No. You're merely linking to an argument made by someone at NRO, and then demanding that other people refute it.

Dumb.

Here's the bottom line for me: The economics of this crises are exceedling complex and there's no one in this forum (AFAIK) who is qualified to discuss it.
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Old 10-08-2008, 02:00 PM
gwlaw99 gwlaw99 is offline
 
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Originally Posted by TwinSwords View Post
Are you advancing an argument in your own words? No. Are you "saying anyting substantive"? No. You're merely linking to an argument made by someone at NRO, and then demanding that other people refute it.

Dumb.

Here's the bottom line for me: The economics of this crises are exceedling complex and there's no one in this forum (AFAIK) who is qualified to discuss it.
Read the thread before posting.

By amjeff

"Are you really saying that ACORN is responsible for the current mess? I'd love to see someone try to demonstrate the validity of that assertion."

amjeff asked me to post evidence by someone. I did. I didn't ask anyone to refute it factually until people tried to refute on their own with ad hominem attacks. I guess I should not have expected any actual argument despite being asked to find someone making the case against ACORN myself.

Last edited by gwlaw99; 10-08-2008 at 02:11 PM..
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  #20  
Old 10-08-2008, 01:57 PM
AemJeff AemJeff is offline
 
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Default Re: The Mind and the Market

Quote:
Originally Posted by gwlaw99 View Post
Sorry, but whether you agree with their politics or not National Review is respected publication. If you cited the Nation or Mother Jones, I would not dismiss your argument simply because it was written in a far left publication.

If you don't want to say anything substantive that's your prerogative. Given your normal thoughtful contributions to this board, I'm disappointed.
I didn't say that my agreement (or lack thereof) with his politics had anything to do with my argument. What I said was that he was raising a political, not a factual case. He uses characterizations of his target's actions and beliefs that fly nicely as rhetoric, but are, at best, unsupported by his factual claims.
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  #21  
Old 10-08-2008, 01:58 PM
bjkeefe bjkeefe is offline
 
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Originally Posted by gwlaw99 View Post
Sorry, but whether you agree with their politics or not National Review is respected publication.
No it isn't.

How's that for matching unsupported assertions?

Quote:
If you don't want to say anything substantive that's your prerogative. Given your normal thoughtful contributions to this board, I'm disappointed.
Oh, stop feeling so sorry for yourself. Talk about something besides ACORN wingnuttery and you'll get some respect in return. You all have been shoveling that shit for half a year now. Give it a rest. There isn't anything there. This is as bad as the last time you showed up to insist that Obama wants to teach kindergartners to have sex.
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  #22  
Old 10-08-2008, 01:48 PM
AemJeff AemJeff is offline
 
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Again, you make absolutely no reutations to the points in the article. You just make ad hominem attacks on NRO. Is that really the best you can do?
Really? No refutation? I said that the partisan, political argument raised in the article you cited doesn't rise to the level of believability. That's not ad hominem.
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Old 10-08-2008, 01:57 PM
gwlaw99 gwlaw99 is offline
 
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Really? No refutation? I said that the partisan, political argument raised in the article you cited doesn't rise to the level of believability. That's not ad hominem.
Refute the fact that Acorn sued banks to make them lower their credit standards.

Refute the facts that:

"Democratic Senator Allan Dixon convened a Senate subcommittee hearing at which an ACORN representative gave key testimony"

"Dixon responded by pressing Fannie and Freddie to do more to relax those standards — and by promising to introduce legislation that would ensure it."

"By July of 1991, ACORN’s legislative campaign began to bear fruit. As the Chicago Tribune put it, “Housing activists have been pushing hard to improve housing for the poor by extracting greater financial support from the country’s two highly profitable secondary mortgage-market companies. Thanks to the help of sympathetic lawmakers, it appeared...that they may succeed.” The Tribune went on to explain that House Democrat Henry Gonzales had announced that Fannie and Freddie had agreed to commit $3.5 billion to low-income housing in 1992 and 1993, in addition to a just-announced $10 billion “affordable housing loan program” by Fannie Mae."

"Clinton Housing Secretary Henry Cisnersos pledged to meet monthly with ACORN representatives."

"In early 1994, the Clinton administration floated plans for committing $1 trillion in loans to low- and moderate-income home-buyers, which would amount to about half of Fannie Mae’s business by the end of the decade. "

"in June of 1995, President Clinton, Vice President Gore, and Secretary Cisneros announced the administration’s comprehensive new strategy for raising home-ownership in America to an all-time high. Representatives from ACORN were guests of honor at the ceremony. In his remarks, Clinton emphasized that: “Out homeownership strategy will not cost the taxpayers one extra cent. It will not require legislation.” Clinton meant that informal partnerships between Fannie and Freddie and groups like ACORN would make mortgages available to customers “who have historically been excluded from homeownership.” (i.e. sub-prime loans)
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Old 10-08-2008, 02:16 PM
AemJeff AemJeff is offline
 
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Originally Posted by gwlaw99 View Post
Refute the fact that Acorn sued banks to make them lower their credit standards.

Refute the facts that:

"Democratic Senator Allan Dixon convened a Senate subcommittee hearing at which an ACORN representative gave key testimony"

"Dixon responded by pressing Fannie and Freddie to do more to relax those standards — and by promising to introduce legislation that would ensure it."

"By July of 1991, ACORN’s legislative campaign began to bear fruit. As the Chicago Tribune put it, “Housing activists have been pushing hard to improve housing for the poor by extracting greater financial support from the country’s two highly profitable secondary mortgage-market companies. Thanks to the help of sympathetic lawmakers, it appeared...that they may succeed.” The Tribune went on to explain that House Democrat Henry Gonzales had announced that Fannie and Freddie had agreed to commit $3.5 billion to low-income housing in 1992 and 1993, in addition to a just-announced $10 billion “affordable housing loan program” by Fannie Mae."

"Clinton Housing Secretary Henry Cisnersos pledged to meet monthly with ACORN representatives."

"In early 1994, the Clinton administration floated plans for committing $1 trillion in loans to low- and moderate-income home-buyers, which would amount to about half of Fannie Mae’s business by the end of the decade. "

"in June of 1995, President Clinton, Vice President Gore, and Secretary Cisneros announced the administration’s comprehensive new strategy for raising home-ownership in America to an all-time high. Representatives from ACORN were guests of honor at the ceremony. In his remarks, Clinton emphasized that: “Out homeownership strategy will not cost the taxpayers one extra cent. It will not require legislation.” Clinton meant that informal partnerships between Fannie and Freddie and groups like ACORN would make mortgages available to customers “who have historically been excluded from homeownership.” (i.e. sub-prime loans)
ACORN's raison d'ętre was to make housing credit available to a wider group of applicants. The list you provided here isn't in dispute.

It's the establishing of a significant causal relationship between those relaxed standards, to the extent that ACORN was successful, and the current situation that needs to be proven.

Even granting that (I don't), I'd be slow to try and characterize ACORN as evil, or impugn the motives or the judgment of those who have supported it over the years.
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Old 10-08-2008, 02:27 PM
gwlaw99 gwlaw99 is offline
 
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Originally Posted by AemJeff View Post
ACORN's raison d'ętre was to make housing credit available to a wider group of applicants. The list you provided here isn't in dispute.

It's the establishing of a significant causal relationship between those relaxed standards, to the extent that ACORN was successful, and the current situation that needs to be proven.

Even granting that (I don't), I'd be slow to try and characterize ACORN as evil, or impugn the motives or the judgment of those who have supported it over the years.
You are right. I don't have data charts to prove that, but is seems a pretty obvious conclusion that if you make something much easier to obtain it will increase the number of people obtaining it. I think it is also pretty well accepted that the number of sub-prime loans has skyrocketed since the changes to Fanny And Freddie in the mid 90's

"I'd be slow to try and characterize ACORN as evil, or impugn the motives or the judgment of those who have supported it over the years."

I'd agree that their motives in making mortgages more affordable was not evil and their intentions were probably good. However, it was clearly a horrible economic mistake to do so.

Last edited by gwlaw99; 10-08-2008 at 02:30 PM..
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  #26  
Old 10-08-2008, 02:35 PM
AemJeff AemJeff is offline
 
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However, it was clearly a horrible economic mistake to do so.
It's not so clear to me, of course - but at least now we agree on what we disagree about!
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  #27  
Old 10-08-2008, 02:45 PM
gwlaw99 gwlaw99 is offline
 
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I don't want to put words in your mouth, but does that mean you think the ease in which people can get subprime loans was sound economic policy? Do you think the amount of subprime loans made available by relaxing credit standards had anything to do with the economic meltdown?
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Old 10-08-2008, 03:02 PM
AemJeff AemJeff is offline
 
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I don't want to put words in your mouth, but does that mean you think the ease in which people can get subprime loans was sound economic policy? Do you think the amount of subprime loans made available by relaxing credit standards had anything to do with the economic meltdown?
I'm agnostic. I think what we're really talking about is matters of degree, with no clear boundary between right and wrong.

My personal view is that the commoditisation (neologism alert!) of bundled mortgages as insured assets lead to a lack of moral hazard at the retail level. I blame that for allowing standards to be bent or broken, more than I blame what seems to have been an orderly modification of those standards for creating the current mess.

But if I'm honest, I have to admit that that's basically an a priori judgment, based on my (liberal) political outlook. I don't know how we go about making a reliable empirical case - I'm sure there are important variables that we can't even name, let alone quantize.
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Last edited by AemJeff; 10-08-2008 at 03:23 PM.. Reason: delete useless phrase
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  #29  
Old 10-08-2008, 03:55 PM
gwlaw99 gwlaw99 is offline
 
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Originally Posted by AemJeff View Post
I'm agnostic. I think what we're really talking about is matters of degree, with no clear boundary between right and wrong.

My personal view is that the commoditisation (neologism alert!) of bundled mortgages as insured assets lead to a lack of moral hazard at the retail level. I blame that for allowing standards to be bent or broken, more than I blame what seems to have been an orderly modification of those standards for creating the current mess.

But if I'm honest, I have to admit that that's basically an a priori judgment, based on my (liberal) political outlook. I don't know how we go about making a reliable empirical case - I'm sure there are important variables that we can't even name, let alone quantize.
I completely agree with you that the making loans into securities is a major cause of the problem. If you read my first post on the thread, I was wondering why the diavlog participants did not also talk about the relaxing of lending standards. After all you can't "securitize" bad loans if you can't make those loans in the first place. You can still "securitize" good loans, but they won't be made valueless by bad loans they are backed by (which should never have been made in the first place) defaulting.
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Old 10-08-2008, 08:10 PM
AemJeff AemJeff is offline
 
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I completely agree with you that the making loans into securities is a major cause of the problem. If you read my first post on the thread, I was wondering why the diavlog participants did not also talk about the relaxing of lending standards. After all you can't "securitize" bad loans if you can't make those loans in the first place. You can still "securitize" good loans, but they won't be made valueless by bad loans they are backed by (which should never have been made in the first place) defaulting.
The controversy seems to be whether to assign more blame on the demand side or the supply side. Ultimately I think you have to blame the side with more power, and in my view that's not the people buying the mortgages.
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Old 10-08-2008, 09:27 PM
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The controversy seems to be whether to assign more blame on the demand side or the supply side. Ultimately I think you have to blame the side with more power, and in my view that's not the people buying the mortgages.
It's very hard for people to understand that. Particularly when the alternative hypothesis serves other kinds of agendas.
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  #32  
Old 10-08-2008, 10:26 PM
AemJeff AemJeff is offline
 
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It's very hard for people to understand that. Particularly when the alternative hypothesis serves other kinds of agendas.
I'll stay away from the "agendas" part of this, but this is one of my pet ideas explaining the difference between conservatives and liberals - i.e. our attitudes toward power. Certainly my primary political motivations stem from the idea that the best approach is almost always to move in a balancing direction, rather than to let power accumulate by default. Strict Libertarians will argue that people like me are too tolerant of government power, but given the choice between public and private power in a constitutional state, I think public is often preferable.

This is in danger of being completely off-topic, but you triggered a chain of thought. Closer to the point is that I believe that logically, it's hard to come to a different conclusion. Greater moral responsibility is a direct consequence of greater power.
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Old 10-08-2008, 10:36 PM
Ocean Ocean is offline
 
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I'll stay away from the "agendas" part of this, but this is one of my pet ideas explaining the difference between conservatives and liberals - i.e. our attitudes toward power. Certainly my primary political motivations stem from the idea that the best approach is almost always to move in a balancing direction, rather than to let power accumulate by default. Strict Libertarians will argue that people like me are too tolerant of government power, but given the choice between public and private power in a constitutional state, I think public is often preferable.

This is in danger of being completely off-topic, but you triggered a chain of thought. Closer to the point is that I believe that logically, it's hard to come to a different conclusion. Greater moral responsibility is a direct consequence of greater power.
Isn't it one of the principles of law to protect the most vulnerable?

Greater power always entails greater responsibility in a rational society.

And don't leave the agendas aside. It's part of the process to deflect blame away from the bearers of power, and then, additionally, place it on some conveniently hated group or a group that has no voice or on a political adversary. You kill two birds with one stone.
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Old 10-08-2008, 10:42 PM
TwinSwords TwinSwords is offline
 
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You guys are both right.
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Old 10-09-2008, 11:34 PM
AemJeff AemJeff is offline
 
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Isn't it one of the principles of law to protect the most vulnerable?

Greater power always entails greater responsibility in a rational society.

And don't leave the agendas aside. It's part of the process to deflect blame away from the bearers of power, and then, additionally, place it on some conveniently hated group or a group that has no voice or on a political adversary. You kill two birds with one stone.
Talking about agendas makes me uncomfortable in this sort of discussion because I'm painting with a broad brush. There no doubt that among some Republicans side that blaming ACORN for the current mess, e.g., is a fairly transparent code. But not everybody thinks that way, and just because it can be misused doesn't mean an argument is invalid. In this case I think the important issue is that the causative relationship, and if that exists, its degree are unknown. Before that argument should be even considered somebody needs to crunch a lot of numbers - and that assumes that it's the sort of thing that could be demonstrated, and as I said, I'm far from convinced that even that is the case.
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Old 10-09-2008, 11:57 PM
Ocean Ocean is offline
 
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Talking about agendas makes me uncomfortable in this sort of discussion because I'm painting with a broad brush. There no doubt that among some Republicans side that blaming ACORN for the current mess, e.g., is a fairly transparent code. But not everybody thinks that way, and just because it can be misused doesn't mean an argument is invalid. In this case I think the important issue is that the causative relationship, and if that exists, its degree are unknown. Before that argument should be even considered somebody needs to crunch a lot of numbers - and that assumes that it's the sort of thing that could be demonstrated, and as I said, I'm far from convinced that even that is the case.
I think that there is general impression that it is impossible to backtrack the many layers of transaction that would allow the kind of analysis you suggest.

My comments have focused more on the process of assigning blame. If the causality cannot be established, it will continue to be at best speculation about what factors have contributed. I suspect that the story will have to rely on individual reports about what was really going on within the financial institutions.
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Old 10-09-2008, 03:41 PM
Me&theboys Me&theboys is offline
 
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....this is one of my pet ideas explaining the difference between conservatives and liberals - i.e. our attitudes toward power. Certainly my primary political motivations stem from the idea that the best approach is almost always to move in a balancing direction, rather than to let power accumulate by default. Strict Libertarians will argue that people like me are too tolerant of government power, but given the choice between public and private power in a constitutional state, I think public is often preferable.
I'd be interested to hear more about your ideas. Do they go beyond the points made above? My own opinion is that the primary difference between conservatives and liberals is their view of human nature (constrained versus unconstrained). I wonder if the differing attitudes about power ultimately stem from a more fundamental difference in views of how people end up USING power.

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....Closer to the point is that I believe that logically, it's hard to come to a different conclusion. Greater moral responsibility is a direct consequence of greater power.
This is a good example of differing views about the USE of power. Rather than the above, I would state that greater moral responsibility is a DESIRED consequence of greater power, but it is by no means a DIRECT consequence of greater power. At least, not in the eyes of the power-holder. This would probably qualify as a constrained view, regarding people as constrained by their nature, in a multitude of ways, from doing what they should do.
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Old 10-09-2008, 10:42 PM
AemJeff AemJeff is offline
 
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I'd be interested to hear more about your ideas. Do they go beyond the points made above? My own opinion is that the primary difference between conservatives and liberals is their view of human nature (constrained versus unconstrained). I wonder if the differing attitudes about power ultimately stem from a more fundamental difference in views of how people end up USING power.
When I try to decode my own political instincts, that dichotomy is what seems to be the dominant theme. But that's really all I was expressing, sort of an exegesis of my own motivations and views, rather than some comprehensive psychology of political beliefs.

You could, with about equal validity, I think, talk about e.g., relationships with authority or personal insecurity versus confidence, or any number of other metrics. I'm not sure that any of these views are completely distinct from one other. I'm am sure that the terms don't necessarily mean the same thing to me as they do to you, or someone else. I don't have a clue how to begin to analyze this stuff. But, for me, as a an organizing principle, the approach to the accumulation of power by various people, works pretty well.

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This is a good example of differing views about the USE of power. Rather than the above, I would state that greater moral responsibility is a DESIRED consequence of greater power, but it is by no means a DIRECT consequence of greater power. At least, not in the eyes of the power-holder. This would probably qualify as a constrained view, regarding people as constrained by their nature, in a multitude of ways, from doing what they should do.
As a practical matter, whether people take their responsibilities seriously is different from whether or not they' accrued those responsibilities. But I think that the moral responsibility that one bears in any given situation is directly proportional to how much power, relatively, you've brought to the situation.
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Old 10-10-2008, 10:49 AM
Me&theboys Me&theboys is offline
 
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As a practical matter, whether people take their responsibilities seriously is different from whether or not they' accrued those responsibilities. But I think that the moral responsibility that one bears in any given situation is directly proportional to how much power, relatively, you've brought to the situation.
I guess I still have trouble with this idea. Why should moral responsibility vary in relation to power? Moral responsibility accrues to everyone equally, regardless of their relative power. Thinking otherwise is what leads people to rationalize their behavior - they cast themselves as the underdog and their behavior is instantly justified. I don't think anyone is off the hook for moral responsibility in all aspects of life. No-one should be given a pass on that, not the weak and not the powerful. That said, it is clear that many people, those with power and those without, do not own their moral responsibilities. We just happen to notice this failing more readily in those with power. But it is the failing that is the problem, not the holding of power itself. One's view of how universal and prevalent this failing is will influence one's views on the allocation of power.
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Old 10-10-2008, 11:37 AM
AemJeff AemJeff is offline
 
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I guess I still have trouble with this idea. Why should moral responsibility vary in relation to power? Moral responsibility accrues to everyone equally, regardless of their relative power. Thinking otherwise is what leads people to rationalize their behavior - they cast themselves as the underdog and their behavior is instantly justified. I don't think anyone is off the hook for moral responsibility in all aspects of life. No-one should be given a pass on that, not the weak and not the powerful. That said, it is clear that many people, those with power and those without, do not own their moral responsibilities. We just happen to notice this failing more readily in those with power. But it is the failing that is the problem, not the holding of power itself. One's view of how universal and prevalent this failing is will influence one's views on the allocation of power.
I get the feeling we might not be talking about exactly the same things. Capital is a limited resource. Generally home buyers are at a disadvantage relative to lenders in that regard - the lenders are gate keepers, regulating access to capital. The game gets played, largely, by their rules. That's what I mean by power. If there are downstream effects caused a group of transactions, should we blame the folks who make and enforce the rules, or the folks who have little choice but to play by those rules?
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