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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: Skeeter Bug who wrote (261913)7/18/2010 8:08:24 PM
From: tejekRead Replies (1) of 306849
 
>Wasn't it in fact the "Banking System" on the verge of collapse.

Yes.<<

and who regulated the banking system?

The FIDC and Federal Reserve who, under Bush, did lttle regulating of anything.

who was the new york representative of that organization that allowed then run up to the brink of the collapse abyss?

There were two parts to the debacle. The first part had to do with the banks and the loans they provided earlier in this decade. To grow their loan portfolios, they fudged income documents and appraisals to make people eligible for loans who wouldn't have been normally. Even if the feds were regulating the banks, they never would have caught this BS.

The banks also created new mortgage vehicles that pushed the envelop in terms of fiscal credibility. That happened late in the housing boom and is what pushed everything over cliff. Had the feds been regulating, they should have caught these bad boys before they had major impact. They did not.

The second part of the economic debacle had to do with the creation of financial derivatives such as CDOs by hedge funds and other Wall Street institutions. Again, even if Bush had been regulating, its not likely they would have caught this crap because the hedgies were clever and buried toxic loans amidst a lot of good loans.

Bottomline: Any monitoring system requires that there be basic level of integrity that most people operate under and that only the bad boys are screwing up. Under Bush, that basic level of integrity went out the window. Everyone was screwing up on some level. It was the free markets working at their optimum. And we all paid the price.
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