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> Notably he did speak up about Fannie and Freddie in the early 2000s but was silenced by the GOP's drive to make war Wrong. Fannie and Freddie were protected

by anamax 17y ago

> Notably he did speak up about Fannie and Freddie in the early 2000s but was silenced by the GOP's drive to make war Wrong. Fannie and Freddie were protected by Dems, not Repubs. Mccain got his teeth kicked in over this one. Interestingly enough, Fannie and Freddie execs during that time were largely Dems, most of whom who landed in the Obama administration. While at Fannie and Freddie, they took out millions. Oh, and during this time, Fannie and Freddie were lying about the mortages in their portfolios, which threw off everyone's risk evaluation. (Their portfolios contained far more subprime than they admitted to.) If Fannie and Freddie weren't politically connected GSEs, folks would be in jail.

grandalf 17y ago
Everything you say is accurate except the insinuation that Democrats are mostly at fault. George W. Bush was in office for the worst of it, and he spent his political capital trying to convince people that a war was necessary. He spent 99% of his political capital on war and at best 1% on everything else. He was far from powerless, having control of both houses of congress. The fact is he was perfectly fine with the GSEs being someone else's problem so nobody would get distracted away from the "war". Incidentally the GSEs were taken off government books in order to make the budget look better so we could "afford" the Vietnam war.
- anamax 17y ago
  > Everything you say is accurate except the insinuation that Democrats are mostly at fault. George W. Bush was in office for the worst of it In this matter, Bush's sins are sins of omission - as you point out, he didn't do anything. Dems did something, but what they did was wrong. For example, they actively protected Fannie and Freddie. Those are sins of comission. Note that Bush didn't change the regulatory structure - he went with what Clinton left him. Again - omission vs comission. It's the difference between manslaughter and murder. And, that's ignoring ACORN's role. Among other things, they picketed banks that didn't make enough loans to folks who couldn't afford them. They tried to intervene with regulators. And so on. Yes, Bush might have been able to keep this from happening, but he would have been fighting Dems the whole way. He didn't fight. They pushed bad policies. There is a difference. And, I note that Barney Frank is still in office and Gorelick, among others, are in the Obama administration. Bush? Not in office.
  - btilly 17y ago
    There is plenty of blame to go around, but one of the biggest mistakes leading up to the financial crisis was significantly lowering the amount of cash reserves the investment banks needed to keep on hand. That happened on Bush's watch with Republicans in charge of every branch of government. And the revoking of Glass-Steagall under Clinton? That was introduced by Republicans in both the House and Senate, with the Senate vote being almost entirely on party lines. Yes, Clinton signed it, but it was a Republican bill.
    - grandalf 17y ago
      As for the issue of reserves, I think if you make the argument you are making you have to state what you think the optimal reserve requirement is. If the recent crisis had been a bit smaller, existing reserve levels would have been fine. If the crisis had been a bit bigger, then it's not certain whether even the previous reserve requirements would have been sufficient. The only way you get 100% security is to have a 100% reserve requirement. Anything less is gambling. So if you critique the lowering of reserve rates you are obligated to state what sort of odds you think are more reasonable.
    - anamax 17y ago
      > And the revoking of Glass-Steagall under Clinton? Irrelevant because it didn't have any effect on the crisis. In fact, it allowed some transactions that had some hope of slowing things down. Note that the non-regulated institutions did better, as did the non-regulated arms of regulated institutions. AIG was regulated up the wazoo.
      - btilly 17y ago
        Some of the "too big to fail" issues we saw was definitely because companies got into multiple lines of business that Glass-Steagall would have prevented.
        anamax 17y ago
        > Some of the "too big to fail" issues we saw was definitely because companies got into multiple lines of business that Glass-Steagall would have prevented. Those "other lines of biz" provided some diversification that gave them some chance of survival. It also made it possible for banks to save some of the trading firms. You clearly disagree, so let's have names.

by anamax 17y ago

grandalf 17y ago

Everything you say is accurate except the insinuation that Democrats are mostly at fault. George W. Bush was in office for the worst of it, and he spent his political capital trying to convince people that a war was necessary. He spent 99% of his political capital on war and at best 1% on everything else. He was far from powerless, having control of both houses of congress. The fact is he was perfectly fine with the GSEs being someone else's problem so nobody would get distracted away from the "war". Incidentally the GSEs were taken off government books in order to make the budget look better so we could "afford" the Vietnam war.

anamax 17y ago
> Everything you say is accurate except the insinuation that Democrats are mostly at fault. George W. Bush was in office for the worst of it In this matter, Bush's sins are sins of omission - as you point out, he didn't do anything. Dems did something, but what they did was wrong. For example, they actively protected Fannie and Freddie. Those are sins of comission. Note that Bush didn't change the regulatory structure - he went with what Clinton left him. Again - omission vs comission. It's the difference between manslaughter and murder. And, that's ignoring ACORN's role. Among other things, they picketed banks that didn't make enough loans to folks who couldn't afford them. They tried to intervene with regulators. And so on. Yes, Bush might have been able to keep this from happening, but he would have been fighting Dems the whole way. He didn't fight. They pushed bad policies. There is a difference. And, I note that Barney Frank is still in office and Gorelick, among others, are in the Obama administration. Bush? Not in office.
- btilly 17y ago
  There is plenty of blame to go around, but one of the biggest mistakes leading up to the financial crisis was significantly lowering the amount of cash reserves the investment banks needed to keep on hand. That happened on Bush's watch with Republicans in charge of every branch of government. And the revoking of Glass-Steagall under Clinton? That was introduced by Republicans in both the House and Senate, with the Senate vote being almost entirely on party lines. Yes, Clinton signed it, but it was a Republican bill.
  - grandalf 17y ago
    As for the issue of reserves, I think if you make the argument you are making you have to state what you think the optimal reserve requirement is. If the recent crisis had been a bit smaller, existing reserve levels would have been fine. If the crisis had been a bit bigger, then it's not certain whether even the previous reserve requirements would have been sufficient. The only way you get 100% security is to have a 100% reserve requirement. Anything less is gambling. So if you critique the lowering of reserve rates you are obligated to state what sort of odds you think are more reasonable.
  - anamax 17y ago
    > And the revoking of Glass-Steagall under Clinton? Irrelevant because it didn't have any effect on the crisis. In fact, it allowed some transactions that had some hope of slowing things down. Note that the non-regulated institutions did better, as did the non-regulated arms of regulated institutions. AIG was regulated up the wazoo.
    - btilly 17y ago
      Some of the "too big to fail" issues we saw was definitely because companies got into multiple lines of business that Glass-Steagall would have prevented.
      - anamax 17y ago
        > Some of the "too big to fail" issues we saw was definitely because companies got into multiple lines of business that Glass-Steagall would have prevented. Those "other lines of biz" provided some diversification that gave them some chance of survival. It also made it possible for banks to save some of the trading firms. You clearly disagree, so let's have names.