Member since Oct 16, 2009

Recent Comments

Re: “Rooming houses, the economy

Re: Fed's role in Economic Collapse... While I agree with you that the FED played the central role in this economic collapse, I have to take issue with your assertion that 'The risky people are buying homes they cannot afford' had anything to do with it. Fact is, the bnks pushed the gov't to create an insurance program for them to back loans they made to people with less than perfect credit... i.e. Fannie/Freddie. 2nd, it wasn't 'risky people' defaulting on their loans, it was people with good credit/jobs defaulting on SUB-PRIME/ARM loans that they were steered into by shady mortgage brokers. 60% of people who got sub-prime loans/ARMs actually qualified for prime loans/rates. For African-Americans, the number was around 85%! These people only started defaulting when their rates reset thus raising their payments by hundreds of dollars/month. In actuality, the percentage of people with low credit scores/low wages who got loans during this crisis was the same as it has been for the past 30 yrs and their re-payment rates are actually higher than those who had better credit/jobs. Also, the banks KNEW there were going to be high rates of default on these sub-prime/ARM/No Interest/NO Doc loans and they took out massive numbers of insurance policies on them (credit-default swaps) to cover their asses when they did. People only bought houses 'they couldn't afford' because they were told they COULD afford them, told their houses would NEVER go down in value, and by the very people you are supposed to be able to trust, the brokers/bankers, when you make such a large purchase as this. No, this is about nothing other than GREED by a very small number of people on Wall St. and also by a large number of mortgage brokers, bankers, REAL-ESTATE AGENTS and appraisers throughout the country. Thus, see the NY Times article on the ring of lawyers, mort brokers, re agents, appraisers, etc that were just arrested and indicted for fraud for doing this very thing... ripping people off! To blame this in any way on 'poor people' is bogus, a fraud and is just plain wrong.

Posted by fatt kidd on 10/16/2009 at 10:21 AM

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