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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (126852)	12/9/2009 11:07:17 PM
From: Dale Baker	Read Replies (1) \| Respond to of 540836

Steady growth and low inflation for two decades, as I recall. I doubt that anyone here prospered separately from the economic prosperity created by the broad economy.

To: Sam who wrote (126852)	12/9/2009 11:10:15 PM
From: slacker711	Read Replies (1) \| Respond to of 540836

I'm not sure I see what the "lot of good all around" was. The cost of credit dropped across the board for both consumers and businesses. That matters quite a bit to the economy. Securitization by itself was a good thing. It opens up the ability to supply credit to many more investors than simply the banks. That spreads the risk and matches up investors with loans of a particular risk profile. The problem is the amount leverage that was allowed, particularly with respect to the credit default swaps. AIG was putting up virtually nothing to insure hundreds of billions of dollars worth of securities. The key is to cut back on the leverage. That wont just help with securization, but also with whatever financial innovation comes next. Slacker