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Politics : John McCain for President -- Ignore unavailable to you. Want to Upgrade?

To: longnshort who wrote (4233)	10/14/2008 1:58:52 PM
From: Nicholas Thompson	Read Replies (2) \| Respond to of 6579

That is a chimera, you do not know what you are talking about and are buying the GOP "story" to shift blame to the DEMS. The main reasons for the mortgage meltdown were lax or no regulation or supervision at either the state or federal level, crooked mortgage brokers and mortgage originators such as Countrywide, the packaging of these mortgages into Collateralized Debt Obligations which were obscenely overrated by the debt rating agencies in part because they had Credit Default Swap (CDS) protection. These CDO's were originally sold by firms like Bear Stearns and Lehman; and it turns out, guess what, that the CDS protection was not there since there was no requirement to provide reserves for these CDS.; and, the CDO's were full of toxic mortgages since the credit rating agencies were not doing their job. At the most , and this is really a reach, 10% of the bad mortgages were those pushed on minorities. But since minority borrowers generally borrowed much less than the average borrower, probably no more than 5% of the total borrowing was to minority people and only a reasonable percentage of them hasve gone into default. Many of the defaults and subsequent forclosures have been caused by the general economic conditions, high gas and food prices and by medical costs. These are , in turn, quite attributable to current administration policies. The quasi-federal agencies Freddie and Fannie were late to the game but eventually did get involved in the sale of CDO'S . They were not pure , but they represented much less a percent of the toxic CDOs' than the commercial brokers. The main reason tha Bush wanted to rein these two in was to give more business to the private sector, had that happened things would have been even worse. By the way the totally unregulated CDS market grew, under Bush from 900 billion in late 2000 to 62 trillion at its peak in late 2007.- an increase of almost seventy times to a level four times the size of our GDP. These underlying obligations have been a terribly destablizing problem and are due to the decisions by the GOP administration to ease up on regulation.