{"id":469,"date":"2008-09-24T19:37:01","date_gmt":"2008-09-24T23:37:01","guid":{"rendered":"http:\/\/www.jasetaro.com\/blog\/?p=469"},"modified":"2012-05-15T09:46:18","modified_gmt":"2012-05-15T13:46:18","slug":"anatomy-of-a-crisis","status":"publish","type":"post","link":"https:\/\/www.jasetaro.com\/blog\/2008\/09\/24\/anatomy-of-a-crisis\/","title":{"rendered":"Anatomy of a Crisis"},"content":{"rendered":"

The more I think about the Bush Administration’s proposed 700 billion dollar back bailout the madder I get. The “credit crisis” wasn’t created by by greed and mismanagement on Wall Street. It was created by politicians who thought they could substitute well intentioned politically correct regulation for sound financial practices.<\/p>\n

Economist Stan Liebowitz has an excellent column on the anatomy of the credit crisis in Today’s New York Post<\/a>:<\/p>\n

HOW did America wind up in its worst financial crisis in decades? Sen. Barack Obama explained it this way last week: “When sub-prime-mortgage lending took a reckless and unsustainable turn, a patchwork of regulators systematically and deliberately eliminated the regulations protecting the American people.”<\/p>\n

That’s exactly<\/em> backward. Mortgage lending took that “reckless and unsustainable turn” because<\/em> of regulation – regulation driven by liberals and progressives, not free-market “deregulators.”<\/p>\n

Pushed hard by politicians and community activists, the regulators systematically and deliberately<\/em> altered financially sound lending practices.<\/p>\n

The mortgage market was humming along just fine when, in the late 1980s, progressives decided that it needed to be “fixed.” Their complaint: Some ethnic groups got approved for mortgages at lower rates than others.<\/p>\n

In reality, mortgage lenders were simply being prudent – taking care to provide mortgages to those who could best afford to make the payments.<\/p>\n

The shift began in 1989, when Congress amended the Home Mortgage Disclosure Act to force banks to collect racial data on mortgage applicants. By 1991, critics were using that data to paint lenders as racist by showing that minority applicants were approved at far lower rates. Banks were “Shamed By Publicity,” as one 1993 New York Times headline put it.<\/p><\/blockquote>\n

Unfortunately, as much as I hate the idea, we’ve reached the point where a bailout is probably necessary evil… I’m not so much opposed to the idea of bailout as I am opposed to the idea of bailout without repealing the foolish regulations that created the problem. It’s time Congress owned up to to their role in the mess and tossed out the policies that helped create this mess!<\/p>\n","protected":false},"excerpt":{"rendered":"

The more I think about the Bush Administration’s proposed 700 billion dollar back bailout the madder I get. The “credit crisis” wasn’t created by by greed and mismanagement on Wall Street. It was created by politicians who thought they could substitute well intentioned politically correct regulation for sound financial practices. Economist Stan Liebowitz has an […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[26,7],"tags":[57,129],"class_list":{"0":"post-469","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-economy","7":"category-politics","8":"tag-barack-obama","9":"tag-credit-crisis","10":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/pfpI7-7z","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":2486,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/07\/07\/anatomy-of-a-crisis-the-fannie-mae-and-freddie-mac-debacle\/","url_meta":{"origin":469,"position":0},"title":"Anatomy of a Crisis: The Fannie Mae and Freddie Mac Debacle","author":"Jeff","date":"July 7, 2009","format":false,"excerpt":"Republican members of the House Committee on Oversight and Government Reform have released a report analyzing the role of the government sponsored enterprises (GSE), Fannie Mae and Freddie Mac, in the housing meltdown. You can read the full report here, but here are the highlights: Political pressure led to the\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":664,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/10\/06\/finally-mccain-blasts-obama-democrats-for-fanniefreddie-meltdown\/","url_meta":{"origin":469,"position":1},"title":"Finally: McCain Blasts Obama, Democrats for Fannie\/Freddie Meltdown","author":"Jeff","date":"October 6, 2008","format":false,"excerpt":"Update: Scroll down for the video. It looks like the gloves are really off, John McCain is going to finally start talking about the economy and going after Barack Obama and Democrats for their roll in the failure of Fannie Mae and Freddie Mac. Our current economic crisis is a\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":383,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/09\/17\/the-democrats-credit-crisis\/","url_meta":{"origin":469,"position":2},"title":"The Democrats Credit Crisis…","author":"Jeff","date":"September 17, 2008","format":false,"excerpt":"The more I dig into the history behind our current crisis the more outraged I become... Commenter Veretax writes: \"I think the American people have had it with this situation where the middle-income people in our country are not protected from the ramifications of the risk-taking and the greed of\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":381,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/09\/16\/how-did-we-get-here\/","url_meta":{"origin":469,"position":3},"title":"How Did We Get Here?","author":"Jeff","date":"September 16, 2008","format":false,"excerpt":"Ed Morrissey @ Hot Air asks \"Whose policies led to the credit crisis?\" The answer depends on who you ask... Democrats of course blame Republicans and Republicans of course blame Democrats. Personally, I think it's safe to point fingers at both parties and the Federal Reserve Board. The roots of\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":494,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/09\/26\/back-on-the-trail\/","url_meta":{"origin":469,"position":4},"title":"Back on the Trail…","author":"Jeff","date":"September 26, 2008","format":false,"excerpt":"Statement from the McCain Campaign on negotiations\u00a0 (H\/T: Rich Lowry): John McCain\u2019s decision to suspend his campaign was made in the hopes that politics could be set aside to address our economic crisis. In response, Americans saw a familiar spectacle in Washington. At a moment of crisis that threatened the\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1075,"url":"https:\/\/www.jasetaro.com\/blog\/2008\/12\/09\/my-give-a-damns-busted\/","url_meta":{"origin":469,"position":5},"title":"My Give a Damn’s Busted","author":"Jeff","date":"December 9, 2008","format":false,"excerpt":"I haven't been blogging much recently I've tied up a couple of projects that have to be finished before the end of the year, and frankly I'm so disgusted, disappointed and disillusioned with the behavior of our elected leaders my give a damn's busted. It doesn't matter what we think,\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts\/469","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/comments?post=469"}],"version-history":[{"count":0,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts\/469\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/media?parent=469"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/categories?post=469"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/tags?post=469"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}