I haven't been contributing as much because I am back home in Miami. But will try and get my 2 cents in from time to time. I know if I don't WW will be depressed.
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I haven't been contributing as much because I am back home in Miami. But will try and get my 2 cents in from time to time. I know if I don't WW will be depressed.
[QUOTE=Miamipro;412914]I haven't been contributing as much because I am back home in Miami... but will try and get my 2 cents in from time to time.. I know if i dont WW will be depressed[/QUOTE]
Obama is depressing the hell out of me (and the economy and the nation as a whole). Don't worry, the electorate is about to deliver some electoral prozac.
Stan posted a research-based case why he believes Fannie and Freddie were the primary cause of the housing bubble and economic mess. I respect the research effort, and it is true that many people who have looked into this topic agree Fannie / Freddie share some blame. Some even believe Fannie / Freddie were a significant factor, among several. But very few people / analyses have concluded Fannie / Freddie were "the" primary factor. Consider the following.
1. Fannie and Freddie expanded their presence in the mortgage market for decades, while house prices steadily increased without a giant housing bubble developing. As the housing bubble formed last decade, the GSE share of the mortgage market declined from 42% in 2000, to 34% in 2006.
2. Subprime was a small component of the mortgage market between 1997-2003, comprising between 5-8% of all mortgage originations each year. Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent.
3. These charts show the pattern clearly. Over the period 2003-06, Fannie and Freddie saw a sharp drop in their share of residental mortgage securitization. Over the same period, non-agency MBS issuance surged, a majority of which was subprime and Alt-A issuance which increased from approx. $270 Billion to $800 Billion.
[url]http://krugman.blogs.nytimes.com/2010/06/03/things-everyone-in-chicago-knows/[/url]
4. For another look at the numbers see this report, Figure 1.2: Enterprises' Market Share.
Per the report, private-label issuers played a large role in securitizing higher-risk mortgages from early 2004 to mid-2007 while the GSEs continued to guarantee primarily traditional mortgages. Consequently, the GSEs lost market share of MBS issuance. After private-label issuers exited the secondary mortgage market in 2007, the GSEs market share increased.
[url]http://www.fhfa.gov/webfiles/16592/ConservatorsRpt82610.pdf[/url]
[url]http://modeledbehavior.files.wordpress.com/2010/08/image7.png[/url] (figure only)
5. In addition, commercial real estate also experienced a giant bubble over the same period, but CRE is outside the scope of the GSEs. This provides evidence of a broad-based bubble fueled by other market forces, such as speculation.
[url]http://mit.edu/cre/research/credl/rca.html[/url]
Of course this all took place against a backdrop of low interest rates, and a giant global pool of money (represented by $70 trillion in worldwide fixed income investments) seeking higher yields than those offered by USA Treasury bonds. This pool of money had roughly doubled in size from 2000 to 2007, yet the supply of relatively safe, income generating investments had not grown as fast. Wall Street answered this demand with MBS and CDO securities, which were assigned safe ratings by credit rating agencies. And this was all facilitated by deregulation such as the 1999 passage of the Gramm-Leach-Bliley Act, and lax regulatory oversight over the bubble years. Bush's housing push was also part of the backdrop. Speculation and real estate "flipping" also played a large role. In 2005-2006, a record level of nearly 40% of home purchases were not intended as primary residences.
There is a good argument that private sector factors, as well as government policy / regulation, all played significant roles. Fannie and Freddie also clearly played a role. But the argument that Fannie and Freddie were "the" primary factor, is simply weak, which is why it is seen as little more than a conservative talking point among most people who have studied the topic.
[QUOTE=Esten;412937]Fannie and Freddie also clearly played a role. But the argument that Fannie and Freddie were "the" primary factor, is simply weak...[/QUOTE]So your best counter-argument, intended to negate everyone else's contention that [I]"Fannie and Freddie were 'the primary factor'"[/I] in the mortgage meltdown, appears at best to move only slightly off that point to merely that [I]"Fannie and Freddie also clearly played a role"[/I]?
Man, that's thin.
Linda McMahon barbecued Dick Blumenthal in her answer to the debate question [I]'How do you create a job? '[/I].
Blumenthal rambled on for a minute and 20 seconds about government's role in creating jobs, and then McMahon responded with this:
[quote=Linda McMahon]Government does not create jobs. It’s very simple how you create jobs. An entrepreneur takes [a] risk. He or she believes that they [can] create or good or service that is sold for more than it costs to produce it. If an entrepreneur thinks he can do that, he creates a job.[/quote]Here's the 2 minute video clip: [url]http://www.youtube.com/watch?v=6uilFn6mgm4[/url]
[QUOTE=Jackson; 412940]Linda McMahon barbecued Dick Blumenthal in her answer to the debate question [I]'How do you create a job? '[/I].
Blumenthal rambled on for a minute and 20 seconds about government's role in creating jobs, and then McMahon responted.
Here's the 2 minute video clip: [url]http://www.youtube.com/watch?v=6uilFn6mgm4[/url][/QUOTE]I am not sure how involved she was at WWE but that company went from laughing stock to NYSE big board stock (EV over US$1.0B. They employ nearly 600 people. Blumie is a liar and elitist snob (lives near friends of mine) and doesn't know how to create a job because he has never done it.
[QUOTE=Wild Walleye;412950]I am not sure how involved she was at WWE...[/QUOTE]She was actually the president for the entire life of the company. Her husband Vince McMahon was and is the big-beefy ex-wrestler who is the MC at many of their events.
[QUOTE=Jackson;412939]So your best counter-argument, intended to negate everyone else's contention that [I]"Fannie and Freddie were 'the primary factor'"[/I] in the mortgage meltdown, appears at best to move only slightly off that point to merely that "Fannie and Freddie also clearly played a role"?
Man, that's thin.[/QUOTE]
You beat me to the punch. Thanks for saving me the trouble. His response -- on an issue that he claims to have been investigating for quite some time -- is the best example of how weak the counter-argument is. But then, that's what I've come to expect. I'm back to not responding. If I knew where the !@#$!# Ignore button was, I'd probably use it.
[QUOTE=Jackson;412959]She was actually the president for the entire life of the company. Her husband Vince McMahon was and is the big-beefy ex-wrestler who is the MC at many of their events.[/QUOTE]But did not realize that she ran the company. Wow. That is pretty impressive. No, actually it is very impressive.
[QUOTE=Wild Walleye;412961]But did not realize that she ran the company. Wow. That is pretty impressive. No, actually it is very impressive.[/QUOTE]
I've been following the company (not the show) for ages, long before the World Wildlife Fund made them change their name. She may have the title, but I'm not sure she actually ran the show there. Then again, I'm not sure she didn't. If that Youtube clip is any guide, she's pretty sharp. Why she would want to get into government, I'll never know. But, Vince McMahon is the one who grew up as the promoter's son and really brought the company to prominence.
They made a ton of dough on licensing and PPV, both before and after they went public. You may recall that Monday Night Football moved back it's start time for a while so as not to have to compete with WWF for Monday ratings.
I used to invest in the companies that had the licenses for their video games and action figures, THQ and Jakk's Pacific. Both were extremely lucrative when WWF was hot. Then, WWF discovered that they were being cheated on license fees and took everything back, and I think they made even more money when they re-licensed to others. If she was responsible for that move, it was shrewd. Their brand has cooled off a bunch since then, though.
Seeing the contrast between her and Blumenthal, it's hard to believe anyone could vote for Blumenthal. Then again, it is Connecticut. If you sound like Mr. Howell on Gilligan's Island, you're bound to garner a good portion of the vote.
[QUOTE=Jackson; 412939]So your best counter-argument, intended to negate everyone else's contention that [I]"Fannie and Freddie were 'the primary factor'"[/I] in the mortgage meltdown, appears at best to move only slightly off that point to merely that [I]"Fannie and Freddie also clearly played a role"[/I]?
Man, that's thin. [/QUOTE]If you are looking for some quantitation, I would say F&F played somewhere between a "small" and "medium" size role. This general conclusion has been reached by many people who have studied the topic, is supported by the facts in my post, and is more than "slightly" different from the bogus claim that F&F were the primary factor. Don't take my word for it though, do your own research and you'll see.
What I would say is "thin", is posting a few numbers on F&F while ignoring the private sector numbers and other factors, and claiming that as proof that F&F were the primary factor.
Wouldn't you agree?
I watched the CNBC special "Goldman Sachs: Power And Peril" this evening.
I can't believe they made no mention of the huge role Fannie and Freddie played in forcing Goldman to sell risky mortgage-backed products. Unbelievable!
You mean CNBC doesn't find Fannie and Freddie responsible for the housing bubble.
Wow!! Now, if you could only get Barnie Franks or the ex-CEO's of Fannie and Freddie to step up to the plate and admit that Freddy and Fanny were not responsible for the housing bubble this controversy would be over.
[QUOTE=El Alamo; 412977]You mean CNBC doesn't find Fannie and Freddie responsible for the housing bubble.
Wow! Now, if you could only get Barnie Franks or the ex-CEO's of Fannie and Freddie to step up to the plate and admit that Freddy and Fanny were not responsible for the housing bubble this controversy would be over. [/QUOTE]If America would just accept the fact that it was all those greedy republicans on Wall Street's fault (who oddly donate disproportionately to democrat candidates) and keep the dems in control of all three branches of the govt, it will be like it never happened.
[QUOTE=El Alamo;412977]You mean CNBC doesn't find Fannie and Freddie responsible for the housing bubble.
Wow!! Now, if you could only get Barnie Franks or the ex-CEO's of Fannie and Freddie to step up to the plate and admit that Freddy and Fanny were not responsible for the housing bubble this controversy would be over.[/QUOTE]
Have no fear. Barack Obama is going to clarify that later today.
When he talks about not "returning to the failed policies of the last decade," he's going to clarify that he [i]doesn't mean[/i] the policy of democrats propping up Fannie and Freddie, blocking reform, siphoning off campaign contributions from these GSEs and from criminal Democratic pressure groups like ACORN, appointing Fannie's ex-CEO crooks as one of his campaign advisors, blocking inquiry into the sweetheart loans Democrats received from failed banks, and refusing to include Fannie and Freddie in their financial reform.
It's [i][b]the other failed policies[/b][/i] that he's referring to.