Re: GREAT video on why the economy is suffering, and who caused it.
While many claims in this video are true, there are a few things left out or somewhat broadly interpreted. Most glaringly, the omission of the fact that the defaults of low-income borrowers is a small amount of the current crisis. Much like many of our social ills in this country, the mortgage crisis only made it onto people's radar when it left the inner city and invaded suburbia. It was the middle class borrowers who started defaulting on bad loans on homes ranging from $400K to $2M . . . not low income borrowers losing their $50K - $100 homes. Also, it doesn't discuss the usurious changes in variable interest rates and who is responsible for that. No mention of the bond rating companies -- companies paid by the comapnies issueing the bonds who lied because they don't get paid if the issuer doesn't like the rating. Also no metion of the house of cards economy we have where it is in a lender's immediate interest to sell a loan or the security on a loan because they make more money on selling the bet on the loan than the loan itself. Yes, the Community Reinvestment Act essentially allowed this to happen. However, like much of our law, it was warped and perverted beyond its original intent -- to provide access to loans to those who need them and cannot get them otherwise. The failure was in not placing limits on interest rates and amounts of loans appropriate to the targeted communities amd in failing to regulate our financial markets and lenders. The lenders knew this was nothing more than a Ponzi scheme and Fannie had their full cooporation. This country has GOT to stop thinking about short term gains and think long term and the individuals responsible for the lies and manipulation need to be tried, stripped of all their profits and jailed. And we have to get the lobbyists out of Washington. PERIOD. They make all our decisions for us in their own interests (case in point).