The Democrats that were in a minority in both houses of congress, and thus didn’t chair a single commitee, determine the agenda, or have the ability (aside from fillibuster that they didn’t use much at all) prior to 2006? Those Democrats? Really? Wow, I did not know that! Do you have any bridges for sale?
Yes, if congress screws up with a large Republican majority but a Democrat president, it’s because he lied about having sex with the intern.
Sam Stone’s post only makes sense if you believe that the entire financial crisis is tied to Fannie Mae and Freddie Mac. Also, I find it odd that the Bush Admin -by their own account - was AWOL throughout 2006.
Furthermore, I must say I don’t recollect any high profile push to regulate Mac and Mae. Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership and some testimony in front of Congress doesn’t cut it.
This sort of special pleading really doesn’t help us analyze the problem.
Harrison Hong of Princeton University asks
[ul]
[li]How did the SEC allow for a 30-1 leverage ratio?[/li][li]How were analysts allowed to lie about stocks?[/li][li]How did credit rating agencies issue so many AAA’s?[/li][/ul]
Then again, the financial markets’ natural tendency towards bubbles, the opaqueness and complexity of these derivative instruments along with an absence of standardization and transparency, and financial models grounded on dubious assumptions also played a role.
I will also repeat the longstanding and publicly expressed concerns of Edward Gramlich regarding predatory lending behavior. Abuses such as no document loans were ludicrous on their face, yet nothing was done to curb such fiduciary irresponsibility.
Dean Baker has been predicting the housing bubble crash for many years.
Thread closed at the request of the OP.
Gfactor
General Questions Moderator