Quote:
Originally Posted by kush
Instead of doing some "homework" from biased sources, how about using your common sense? 3 major parties are at fault for the housing burst (listed in no particular order):
1) Government for allowing those ridiculous loans to take place to begin with.
2) Greedy corporations and employees for not better filtering applications based on their ability to payback the loans.
3) Stupid/indifferent borrowers applying for loans and living lifestyles that they can't afford or sustain.
To take blame off the borrowers is about as ridiculous as saying it's credit card companies' faults that people get into massive debt, or to blame gun companies for people shooting themselves (or other people). Sure there are exceptions where people are "tricked" into getting mortgages that they can't pay for, but by far and large, people believe what their desire and greed want them to believe, not what their brains determine to be sound judgment.
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Did you even read what I wrote? The idea that every financial institution would go into a feeding frenzy of risky loans is ludicrous... that is all hype from the government and media with absolutely NO basis on fact. Lenders were FORCED into making a ton of high risk loans by the US government, please reread...
Prominent Democratic and Republican members of Congress and both President Clinton and President Bush put pressure on lending institutions to lower their credit rating standards; reduce the minimum down payment requirements (in a growing number of cases, to zero); and introduce short-term flexible monthly payment methods that would only increase later on. This was under the guise of equal opportunity.
The banks didn't want to lend that money, why would they? It's too risky... they knew that but didn't have a choice. Just go and read up, Google for housing bust and read what actual economists have to say both US and global... stop listening to your TV and read something from world experts once in a while...
I personally find it appalling that I have to go to international news sources to get an honest view of what's going on in this country...
EDIT: But I will agree... people had the choice of taking those loans or not, the burden is not completely on any one person. However the government was the largest facilitator, the companies were the conduit, and the people are the victims. Those subprime loans forced by the government went to low income families with 0% interest up front causing ballooning payments over time that they could never pay for. First time home owners in low income areas usually don't understand the full terms and conditions of a loan...