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Politics : Mainstream Politics and Economics
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To: koan who wrote (7488)1/26/2012 9:41:03 AM
From: Thehammer1 Recommendation  Read Replies (2) of 85487
 
The feds gave 7.7 trillion to 10 trillion to bail out the banks for gods sake! It was stupid ass CDO's and CDS'ss that caused the crash. That is common knowledge and business did that all by themselves.
Koan,

To illustrate my point that the CDO's did not cause the crash but certainly exacerbated the near financial meltdown. I will use the following charts to illustrate my point:

jparsons.net

I remember looking at a version of this in 2004 and it I thought it foretold a big problem coming. You will note how housing diverged by a considerable margin from the historical norm, inflation adjusted house values and relative cost of house-ownership versus renting.

Did the banks make a ton of bad loans - yep.... but that didn't cause the bubble which was popping before the CDO's ever triggered. The public and Congress wants a scapegoat and there is a lot of blame to go around and plenty of incompetence.

Cheers
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