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Politics : View from the Center and Left
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To: Lane3 who wrote (89247)10/9/2008 12:21:48 AM
From: wonk  Read Replies (3) of 541958
 
...When the truth is a bit from column A and a bit from column B.

That's just false equivalency.

Far be it for me to quote Fuld but since he was (I believe) under oath ...

...Mica asked Fuld what role Fannie and Freddie's failure played in Lehman's demise. Fuld's response: "De minimis."

In the financial / legal world, "De minimus" is less than "material" and material is generally construed to be less than 5%.

How often must it be said. Originators made loans that they knew would likely never be repaid because they (and everyone up the chain) were making gobs of money making those loans at the time of origination, and they had a mechanism (MBS) to make sure they weren't left holding the "bag."

So you're holding it and I'm holding it, and a whole lot of people who made the loans (not all of course) will be sipping champagne and vacationing in the Islands for the rest of their lives. Some people who took the loans were speculators or scam artists, but most were simply naive or unsophisticated. Those folks in the latter category are the real victims, because they will lose they homes, or they will be be underwater and crushed by debt service, or they will declare BK and have that follow them for years.

As with most conservative / libertarian ideological constructs, it casts the "welfare queen" in the Cadillac as the norm as opposed to the rather rare exception.

Not to mention the fact that the worldwide financial system is burning down around us. While Great Depression is on everyone's whispered lips, we should also get reacquainted with the Panic of 1873. The credit markets are still frozen.
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