It is really sad and tragic that after almost four years this still has to be said. That after almost four years many people still do not know the true story behind the financial crisis. Do you not see America? Do not be misled by the politicians, political folk and the media who continue to hide the truth about the financial crisis and the resulting recession.
Government and ill-conceived regulations caused the financial collapse and the resulting recession. Most mortgage lenders would never have taken this amount of risk if government had not taken that risk away. That is the reason why government became involved in the first place. Government not only lowered lending standards but they set the quotas via the 'Community Reinvestment Act', for giving bad loans. When lending institutions did not meet these quotas they lowered the lending standards even more through Fannie Mae and Freddie Mac. Mortgage backed securities (MBS) were devised to satisfy the ever increasing demands of government. Government through Fannie Mae and Freddie Mac bought the bad debt from the lending institutions. They then bundled the bad debt into MBS to trade, thus spreading the toxicity throughout the system. Through its incompetence government took all the bad lending risk away. What is worse is that so called 'community organizers' went in and coerced many lending institutions to do this. The people they thought they were helping ended up losing their homes. Everyone is paying for this massive government incompetence and corruption. The tragic thing is many of the same people who were intimately involved in this giant scam, Barney Frank to name just one, are still in government. They should have been thrown out long ago. Many politicians were corrupt, they ignored the problems, they covered up the problems and they quieted the regulators that warned of impending problems.
What may be an even greater tragedy is that Chris Dodd and Barney Frank designed the financial bill that was supposed to fix this. It is ironic that the clueless and/or incompetent politicians passed a bill that is supposed to fix the problem they do not even think they created. The Dodd/Frank financial bill just institutionalizes the problems that created the financial crisis and 'too big to fail' which will ensure more bailouts. The little guy is already seeing the bad results of this bill. Debit cards are more expensive. It will get worse.
The government through the FHA, Fannie Mae and Freddie Mac, who by the way, we the taxpayer continue to bail out, are still giving out bad loans. Government continues the stupidity.
So yes, it is sad and unbelievable that this has to be said. The 'Occupy' protesters are occupying the wrong location. They should be occupying government. It is even more sad and tragic that those that know better are misleading the occupiers.
This will continue to happen until we all know the truth. Only then can we ensure this never happens again.
Unless your agenda is to destroy the system, the solution is not giving millions of people something they cannot afford thereby destroying the whole system and everyone in it. The solution is to ensure everyone has the opportunity and tools to be able to afford a home. They will also be able to create jobs and wealth for others to have the same opportunities they had.
The excellent resources below go into greater detail.
If you want to understand the financial crisis, you must see this FNC Special Investigation: Saving Our Economy - What's Next? (Hulu)