Ok /pol/ I've been trying to wrap my head around the financial crisis/bank bailout, and I'm asking if you can help me fill any blanks in the narrative.
So what happened was:
>Democratic congress gets banks to loan massive amounts of money to people who had no actual income/way of paying off the debt for muh equality, (what legislature can do this?) causing the banks to run dry.
>Govt bails out these banks (and corporations? How do they factor into this?) spending millions and millions of tax payer dollars to keep them upright
>This is done because if the banks fail, countless Americans' monies will go with them, causing another Great Depression. Is this correct?
>Meanwhile lefties are pissed at the govt because the money could have been spent on dem programs but in their eyes the govt only rescued the 1%, nevermind the hundreds of thousands of American jobs provided by the banks and corporations that were saved as well.
>It's all Bush's fault.
>something something Federal Reserve
Am I on track? I feel like I know enough to stump an irl redditor but Im still trying to piece it all together. This will be a good thread for anyone else still uninformed.
Cmon guys I love the Trump Generals too but I think this is worth discussing
Your analysis leaves out the role of derivatives.
Also remember that the TARP program is on the Fed's balance sheet not the federal gov's
>>66622073
>Democratic congress gets banks to loan massive amounts of money to people who had no actual income/way of paying off the debt for muh equality, (what legislature can do this?) causing the banks to run dry.
Wrong.
Banks were more to blame than Democrats
1. Lend out paperless mortgages with no due diligence
2. Banks don't care because they pool the mortgages into securities and sell them off their balance sheets.
3. However, the off balance sheet investment vehicles were given informal lines of credit (i.e. if they went belly up, th banks would bail them out)
4. Bad loans were packaged with good loans to give the securities at least an A rating. But these packages were cut right at the A rating (think of it as 90.1%)
5. Bankers made commissions by selling people on adjustable rate loans or with introductory rates, then made commissions convincing less educated sellers to refinance their mortgage and cash out their equity (so mortgages were worth the value of homes at the higher prices in the bubble)
6. First round of foreclosures start
7. When a handful of mortgages would go bad, the entire security loses its A rating
8. Everyone realizes they're holding securities that they don't know the value of
9. Crisis
>>66622602
10. Even though banks had sold these loans off their balance sheet, they were still on the hook for the off balance sheet investment vehicles
11. This meant that suddenly no one knew which banks were safe because they couldn't trust their books
12. Panic
>>66622073
I can explain what led up to the Financial crisis quite well. To put it short, banks created an incentive for real estate agents to convince people to buy houses they couldn't afford. They sold the mortgages down the line, repackaging them at each step to diversify the risk of holding them, until the last person holding them had zero idea of how risky these investments were, only that they were backed by a random assortment of anonymous mortgages from across the country and given a higher rate of return for the risk compensation.
>>66622566
>>66622602
>>66622695
>>66622715
Fuck, forgive me but I hardly understand all of these finance terms. You guys took economics classes in college? How does one learn all of this shit
Isolationism will MAGA
>>66622602
>Banks were more to blame than Democrats
Depends who you ask on this.
One story is the banks were forced to give loans to poor niggers because muh equality.
It was one of the supposed criticism of that movie on the subject. They failed to accurately portray the government hand in it.
>>66623424
only cuckservatives think the community reinvestment act was to blame
>>66623138
Lol I was an economics major.
Basically:
1. Bank knowingly makes shitty loans
2. Sells them to investment firms they control
3. Shit hits the fan
4. Now the banks might have to bail out these investment firms with cash they don't have
5. Banks get a bailout
6. Go around telling everyone WE A GOOD BOY WE DINDU NUFFIN
>>66622073
you're a straight up moron
read William K. Black
>>66623424
>One story is the banks were forced to give loans to poor niggers because muh equality.
That's literally
>DINDU NUFFIN
bank propaganda
The Community Reinvestment Act didn't kill the banks, moral hazard and their own crooked dealings did
>>66623662
Well is it possible that both are to blame?
I don't know how i would go about investigating it myself when all sources would be propaganda.
>>66623823
the CRA argument ignores that due to the derivatives market, the banks had a financial motive to loan to people with no money
and the fact that banks lied about the quality of those derivatives to earn even more money
>>66622073
Clinton did it. He repealed a near 80 year old law, Glass-Steagall, which separated investment banking from retail (high street) banking.
The gambling money got mixed up with the actual money so badly there was no chance of unpicking it, so they had to save the gamblers.
Source - I do regulatory work for banks.
It was the Democratic gubment. Everything else was a secondary issue.
This is all very interesting. I definitely got the wrong degree.
>>66624377
>We weren't going to murder anyone until the government made it legal
>>66623554
>economics major
ayy so can u hook me up w/ summa dat FREE shit monica?
How hard was it? Im currently interested in filmmaking but I also realize how pathetic that is and stuff like economics or STEM seems much more lucrative and relative. Plus I wont have to put up with SJW shit
>>66624710
>We weren't going to murder anyone until the government made it legal
>Caribbean flag
> Stupid
> Actually said actually nothing
Is this one of those Reddit Bernie fags? Ticks all the boxes...
Your low watt Bern brain can't handle reality. So I won't elaborate. Sigh. Look up Glass Steagall. It will show you who got rid of it (the most 'successful' demo pres for last fifty years.)
Clinton is where the buck stops. Suck on that and shut the fuck up.
>>66624377
Presidents can't repeal laws. What they can do is sign the repeal passed by Congress. Willie C was certainly a participant in that mess but it was Congress that instigated it.
>>66625987
Presidents can't repeal laws.
> 'participant'
> the man who signed it off
Stop trying to deflect reality. Clinton was the boss, he signed it off. He fucked everything up.
>>66622602
>Wrong.
>Banks were more to blame than Democrats
WRONG.
Clinton signed off the removal of the Glass Steagal act.
Look at it this way - yes the banks are scum and their crooked behaviour was their own, but retail finance was mixed in with investment banking crookedness, which allowed them to shift all that personal real debt into their weird thieving machine.
Without Clinton signing off the removal of Glass-Steagall that wouldnt have happened.
The banks were bailed out, at huge public cost, because there was no way to un shuffle the actual debt from the kikery.
Without Clinton signing off on the removal of Glass-Steagall this would not have been possible.
The Democrats did it. They did it because they are cunts who should be banned.
>>66622073
Your first two lines are missing a whole lot of the story.
Think of the first two "banks" that got into trouble - Bear Stearns and Lehman Bros. Those were INVESTMENT banks; not "retail" banks. That means they originated zero residential mortgages, and hence, it wasn't even possible to force them to make those kinds of loans.
>>66627220
I love how /pol/ hates Clinton for removing big evil socialist guburmunt regulation.
You are right though. He shouldn't have removed it, regulations do work, sometimes.
Jewish gobalist are attempting to loot the US before blowing it to hell
>>66627220
The main repeal of Glass-Steagall came through something called the Gramm-Leach-Bliley act.
Phil Gramm, Jim Leach, and Thomas Bliley are all Republicans.
Blaming everything on "the Democrats" is some sort of shill tactic, and it leads to bad policies, because the GOP's own failures are ignored.
>>66623424
Grim-leech is largely to blame created by clinton and a republican congress pushed for by greenspan and other FED kikes
>>66624887
If you don't have an affinity for it you're gonna have a hard time studying economics. Not because it is difficult, but because you're not going to enjoy it at all and then it's gonna be a real pain in the ass to pull through with your studies.
>>66624377
>>66627220
Someone send this to trump.
>You're jackass husband destroyed the economy bitch
>tears
>Trump pulls out a +3 war hammer and knocks killaries block off revealing all the writhing so full corruption inside.
>God then throws a thunderbolt down to smite the menopausal corruption and whence it hit The Well of Filth was born, if you cast a nigger down into the well it comes out an Orc
