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>It's not fraud that caused the financial crisis. Fraud wasn't the initial spark, but it was what turned the American 2008 housing market slump from a self con
by crdoconnor 11y ago
>It's not fraud that caused the financial crisis.
Fraud wasn't the initial spark, but it was what turned the American 2008 housing market slump from a self contained bust into a global financial crisis.
- JackFr 11y agoThat is simply wrong. The US housing bubble, while experiencing fraud at the margins, was neither a cause nor an effect of fraud. The bulk was really due to too much money chasing too few assets, and a bunch of foolish decisions made in good faith by both borrowers and lenders. The idea that fraud lead a US housing bubble to cause a real estate bubble in the UK and Spain, and a banking crisis in Iceland and Ireland is just not correct.
- tim333 11y ago>foolish decisions made in good faith by .... lenders I'd dispute that. Often it was a smart and cynical decision by lenders to make bad loans, take the bonuses and commissions and leave the government and others to clean up the mess. If you were to pin the blame on one group I'd say it was mostly the governments fault for under regulating this stuff.