Posted by
CKHustler on Monday, September 22, 2008 3:19:17 PM
The past couple weeks have seen the liberals blame this banking crisis on Bush and the open-market system of economy. They seem to think that speculation and greed were the only things causing this crisis. How wrong they are! The open market never performs well when it is regulated into doing things it wouldn't normally do. This crisis did not happen over night, nor in 8 years. This crisis has been brewing for decades.
Check out this site...as I will be using this as a center piece of this article.
http://www.lewrockwell.com/dilorenzo/dilorenzo125.html
Thomas DiLorenzo has many articles that are worth reading. Proving capitalism over any other and the such. Very informative. This specific article covers how the government forced this crisis upon us.
Here are a couple quotes from the piece:
"
The thousands
of mortgage defaults and foreclosures in the "subprime"
housing market (i.e., mortgage holders with poor credit ratings)
is the direct result of thirty years of government policy that has
forced banks to make bad loans to un-creditworthy borrowers. The
policy in question is the 1977 Community Reinvestment Act (CRA),
which compels banks to make loans to low-income borrowers and in
what the supporters of the Act call "communities of color"
that they might not otherwise make based on purely economic criteria."
"Banks have
been placed in a Catch 22 situation by the CRA: If they comply,
they know they will have to suffer from more loan defaults. If they
don’t comply, they face financial penalties and, worse yet, their
business plans for mergers, branch expansions, etc. can be blocked
by CRA protesters, which can cost a large corporation like Bank
of America billions of dollars. Like most businesses, they have
largely buckled under and have surrendered to their bureaucratic
masters."
It goes through ACORN as well. Now, who do we know that is associated with ACORN? anyone? Maybe a liberal might know? Ah well...you'll get it. haha
It of course does not rule other factors and he talks about how other factors have helped cause this crisis. This crisis was 30 years in the making though, not 8. This crisis is reaching far and wide across every banking spectrum imaginable. It has spread across seas in some instances. If you build a house of cards with 3 cards, then 3 cards will fall. If you build a house of cards with 30 cards, then 30 cards will fall. We have just seen 30 cards fall from our house of cards. I believe this crisis is much more intertwined with the government than we think. To add in my personal opinion, I think that when the government needed money, they simply added it to the computers and did not print any. Now that is dangerous and can cause a bubble of cash in the economy, without putting any more cash in the economy. When people then started needing their cash, there wasn't any to be had. The numbers may be there, but they aren't actually there. Thats just my opinion, so you can take that anyway you want.
So my final destination of this piece. Banking crisis = government regulation
Your comments are welcome.