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Politics : GOPwinger Lies/Distortions/Omissions/Perversions of Truth -- Ignore unavailable to you. Want to Upgrade?

To: Kevin Rose who wrote (138595)	9/25/2008 3:43:32 PM
From: Lizzie Tudor	Respond to of 173976

I'm looking for a happy medium between free enterprise and regulation. Some industries need to be regulated like healthcare and airlines. We've already tried the free market approach and it doesn't work. But on other things I am much less sure. I remember trying to get a mortgage in California in 1992 when I had a high consulting income and was denied repeatedly even though I could easily afford the house because they used these very restrictive ratios of 30% house to income. Any single person (I was single at the time) could pay more than that. These were rules that came from fannie freddie. The only thing that environment helped were wealthy older people who already owned a ton of real estate, they had their pick of what they wanted to buy because the young people like me couldn't get in. I don't want to go back to that, I am hoping for a happy medium.

To: Kevin Rose who wrote (138595)	9/26/2008 7:47:57 PM
From: TigerPaw	Respond to of 173976

I don't think we can overlook the side-effect of debt backed securities. It used to be that whoever made a loan, collected on the loan, and took the risk. They had the information to tell them whether it was turning out to be a good loan or a bad one and they could adjust their habits or their cushion depending on that knowledge. The debt backed securities divorced that important information from the loan. The owner of the loan really couldn't tell if the loan was made well since they weren't doing the collections. All the securities were treated alike with the assumption that the law-of-averages would make them perform alike. This didn't match reality where sometimes whole communities, and therefore whole debt based security packages performed much differently in one area than in another. TP