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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: combjelly who wrote (562462)	4/22/2010 8:44:45 PM
From: i-node	1 Recommendation Read Replies (1) \| Respond to of 1575551

that lenders are FORCED to make loans to people who aren't qualified to receive them, then you aren't going to help matters." Nonsense. Repeating a lie doesn't make it true. Except it isn't a lie. I suggest you read up on the Clinton regulations and the effect they had on lending. CRA had never had any real teeth until Clinton had the T-regs replaced with permanent ones. Then, and only then, did lenders find themselves COMPELLED to make loans to poorly qualified individuals. If they didn't, they would find their opportunities for growth were extremely limited by those very regulations. There was a lot of lousy paper. Just not for the reasons you keep presenting. And that is because you consistently mis-represent what happened. The derivatives made a huge market for that lousy paper, and that created a demand for it This is an idiotic claim. The loans went bad because they were made to unqualified individuals. Period, end of story. Not because there was a secondary market for the paper or because it could be "insured" with derivatives (this is like saying homeowners policies cause housefires, or that options cause movement in stock prices -- which I've also heard people claim without the slightest basis in fact). Don't get me wrong -- I have no problem with some regulation of these transactions in order to get them out in the open. I do have a problem with the White House trying to move them to Chicago instead of allowing markets to be created in NYC, which stinks of political payoff. But the derivative did NOT create the problem. The bad loans did. And the bad loans were made because of the Clinton regulations, which exacerbated a problem which started with Carter and the CRA -- in effect, pushing lenders to make bad loans. The only way CRA can be defended is out of total ignorance.