underlying causes of the financial crisis

[eisely]

Not wishing to let a good crisis go to waste, it is time to resurrect this topic.

 

There is an excellent book on this subject by Thomas Sowell called "The Housing Boom and Bust." If you cannot get it in a local book store, you can get it on line through Amazon.

 

Thomas Sowell holds advanced degrees in economics and he is what would be considered a "public intellectual" in that he writes columns and books intended for wider audiences. The book I am recommending is very accessible to non specialists. Sowell also happens to be a conservative african american.

 

The book is quite an eye opener. Essentially he very skillfully lays the entire fiasco at the feet of politicians, mostly liberal democrats. Clearly there was greedy incompetent behavior by people in the ordinary banks, investment banks, Fannie Mae, Freddie Mac, AIG, etc., but his point is that they were responding to both incentives and financial threats stemming from political mandates. Read the book.

[GernBlansten]

Anything that takes the blame off the party in power during that debacle has got to be a good read. Can I find it in the fiction section?

[vol_scouter]

I have often read where conservatives will wake some blame for the role of republicans in whatever the issue may be. Left wingers never will admit wrongdoing on the part of the democrats. Thomas Sowell is a black man at Stanford University's Hoover Institute. I am sure that I do not need to point out that Stanford is highly regarded and is certainly left leaning. The Hoover Institute is also highly regarded. So the things to look for in the fiction department are not from Thomas Sowell. The left wing would rather make ad hominem attacks than argue facts since their positions are usually not defensible. In the case of the financial crisis, the blame lays at the feet of the democrats that ask us to trust them now. The democrats are obviously contemptuous of the citizens - why they are re-elected is amazing.

[evmori]

Well this could of happened regardless of what party was in power. The cause of housing debacle lies with the lenders. Most didn't violate any laws. They just made decision driven by greed.

[GernBlansten]

Vol_scouter, why did you feel necessary to describe Sowell's race in defending his credentials?

That's seems odd. Do you think race has anything to do with a person's ability to analyse a financial crisis?

[vol_scouter]

Gern,

 

As usual you wish to attack the person and not argue facts. The left wing realizes that the facts are against their world view so they attack those who are not in lock step with them.

[sherminator505]

In defense of vol_scouter, eisely brought up race as well...

 

I wouldn't say that Democrats are blameless with regard to the current situation. Clinton in particular was just as eager as the Republicans were to take away the "rules of the road" that FDR set up to prevent just such a crash. Witness the result.

 

I think that folks aren't upset with the Republicans for "causing this mess" per se. They are upset with them for denying the problem and trying their best to keep the veneer up from 2006 on to try to hang on to the White House. In hindsight, this was pretty cynical on their part.(This message has been edited by sherminator505)

[OldGreyEagle]

As I understood it, Banks were forced by legislation to make loans to people they normally woudl not and then sold those loans, bundled in with "good" ones on the financial market and then the load bundles started to tank as the mortages were defaulted.

 

I dont know if any side can claim innocence in this, but to point fingers does not resolve the issue nor does it prevent its reoccurence

 

Can we get to a place of solving problems or do we have to apply blame first? We have met the enemy, and he IS us

[GernBlansten]

Why do the defenders of Sowell feel the need to classify him racially? That makes as much sense as making the statement, "Sowell also happens to be a left handed american." or "Thomas Sowell is a short man at Stanford University's Hoover Institute"

 

My question to them is why? Does it make your arguement better? Its as though you put race as a qualifier to competence.

 

[scoutldr]

The problem was (is) "We the people". No one held a gun to our heads and forced us to live beyond our means. My friends and relatives have chided me over the years for living "frugally" in the same house for 27 years and driving used cars, instead of moving up to a $600,000 "McMansion" like my peers live in. I don't have a pool, boat and twin jet-skis. But I do have an adequate house nearly paid off, two college degrees for my sons that I paid for without assistance, and a sizeable (but not enough) retirement fund. And now the current administration wants to penalize me and redistribute my wealth because I was more "responsible" than the "unfortunate" citizens. The democrats can shove it.

[GernBlansten]

More revisionist history. It was the Bush Administration that requested, lobbied and enacted TARP. Please don't single out the Democrats for that slice of heaven.

[scoutldr]

Maybe so...but the Dems continued it and lovingly nurtured it into a multi-trillion dollar boondoggle. I blame them all.

 

Ron Paul 2012

[evmori]

Lenders started making loans based on the value of the collateral instead of the creditworthiness & repayment ability of the borrowers. And let's not forget the mess reverse mortgages caused for the elderly!

[sherminator505]

"The democrats can shove it."

 

I read this on a public forum for Scouters.

[CalicoPenn]

Hoover Institute - Highly Respected. Fact? Not in my book - I'd call that an opinion. I don't respect any of the partisan twaddle that comes out of the Hoover Institute, and I'm not alone in this (or, as a certain British television character might say "And I am unanimous in this").

 

To be fair, I don't believe the Center for American Progress is universally highly respected either. The folks on the right would call their output "partisan twaddle" as well.

 

What respect I have for both those institutions, and other relatively respectable institutions (such as the Cato Institute) comes only from their use of real factual information to develop their opinions (unlike, say, a Fox News, which is real good at using falsehoods to advance their opinions (death panels, anyone?).

 

So that leads to the crux - for the last 20 years, more and more people are misreading Opinion as Fact. What Sowell has published, though using factual information to do it, is essentially Opinion. What he has skillfully done is massaged the facts to support the opinion he wishes to present. To call Sowell's book "Fact" is not accurate. Though it may be non-fiction, it is not fact. Someone else can take the same facts he has used and skillfully massage them to support a completely opposite opinion. Or more to the point, someone else could take a completely different set of facts to create a compelling argument that the blame rests with Reagan and his borrow and spend policies, or that the blame rests with Kennedy for insisting that a man be sent to the moon.

 

I'm always wary of any author that can skillfully lay the blame on one group - it immediately raises alarm bells in my mind that the person has an agenda. I just wish more Americans would start using the critical thinking skills they should have learned in school and at their parent's knees. Alas, it won't happen, and we'll be stuck dealing with this partisan claptrap forever and ever.