Wednesday, October 29, 2008

How we got here: the Credit Crisis

How the Credit crisis of 2008 began, laid out in detail. Although I have one gripe- 'Three months later, the Clinton administration announced a comprehensive strategy to push homeownership in America to new heights - regardless of the compromise in credit standards that the task would require. Fannie and Freddie were assigned massive subprime lending quotas, which would rise to about half of their total business by the end of the decade.' This is the absolutely critical bit, and its not attested by the specific Executive order number(s) (if thats the correct reading of this paragraph) or the bills through Congress (if not). This is the smoking gun.

Between this fact, and the inability of the statisticians analysing securitised sub-prime mortgages to come up with valid values, you have the root of the current debacle. It does seem that a socialist ideology, brought into the political arena by ACORN, is indeed the main cause of the Credit fiasco. Will the electorate care? Will it vote accordingly? Highly improbable...

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