Sub-prime politicians

Thomas Sowell's picture

Amid all the hand-wringing and finger-pointing as housing markets collapse, mortgage foreclosures skyrocket, and financial markets panic, there is very little attention being paid to the fundamental economic and political decisions that led to this mess.

The growth in risky “sub-prime” mortgage loans by people buying homes they could not really afford has been a key factor in the collapse of housing markets, when the risks caught up with both borrowers and lenders.

But why were home buyers suddenly taking out so many risky loans and lenders suddenly arranging so much “creative” financing for these borrowers?

One clue is the concentration of such risky behavior in particular places and times.

Interest-only mortgages, where nothing is being paid on the principal for the first few years, enable many people to get started on buying a home with lower mortgage payments at the outset.

But of course it is only a matter of time before the mortgage payments go up and, unless their income has gone up enough in the meantime for them to be able to afford the new and higher payments, such borrowers can end up losing their homes.

Such risky mortgage loans were rare just a few years ago. As of 2002, fewer than 10 percent of the new mortgages in the United States were of this type. But, by 2006, 31 percent of all new mortgages were of this “creative” or risky type.

In the San Francisco Bay Area, 66 percent of the new mortgages were of this type.

Why this difference in times and places? Because housing prices were skyrocketing in some places and times, so that people of modest incomes had to go out on a limb to buy a house, if they expected to buy a house at all.

But why were housing prices going up so fast, in the first place? A number of studies of communities across the United States and in countries overseas turned up the same conclusion: Government restrictions on building.

While many other factors can be involved — rising incomes, population growth, construction costs — a scrutiny of the times and places where housing prices doubled, tripled, or quadrupled within a decade shows that restrictions on building have been the key.

Attractive and heady phrases like “open space,” “smart growth” and the like have accompanied land use restrictions that made the cost of land rise in many places to the point where it greatly exceeded the cost of the homes built on the land.

In places that resisted this political rhetoric, home prices remained reasonable, despite rising incomes and population growth.

Construction costs were seldom a major factor, for there was relatively little construction in places with severe building restrictions and skyrocketing home prices.

In short, government has been the principal factor preventing the “affordable housing” that politicians talk about so much.

Politicians have also been a key factor behind pushing lenders to lend to borrowers with lower prospects of being able to repay their loans.

The Community Reinvestment Act lets politicians pressure lenders to lend to people they might not lend to otherwise — and the same politicians are quick to cry “exploitation” when the interest charged to high-risk borrowers reflects that risk.

The huge losses of sub-prime lenders, some of whom have gone bankrupt, demonstrate again the consequences of letting politicians try to micro-manage the economy.

Yet with all the finger-pointing in the media and in government, seldom is a finger pointed at the politicians at local, state and national levels who have played a key role in setting up the conditions that led to financial disasters for individual home buyers and for those who lent to them.

While financial markets are painfully adjusting and both lenders and borrowers are becoming less likely to take on so much risky “creative” financing in the future, politicians show no sign of changing.

Why should they, when they have largely escaped blame for the disasters that their policies fostered?

[Thomas Sowell is a senior fellow at the Hoover Institution, Stanford University, Stanford, CA 94305. His website is] COPYRIGHT 2007 CREATORS SYNDICATE, INC.

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Git Real's picture
Submitted by Git Real on Sun, 08/12/2007 - 7:23pm.

You oughta squeeze in a game at Minute Maid! Smiling Git it? Squeeze.. Minute Maid?? Okay, I'll stop now.

I'm planning on a game there in September.


"That man was Griffin Judicial Circuit District Attorney Scott Ballard".


poipendicular's picture
Submitted by poipendicular on Sat, 08/11/2007 - 10:18am.

I can see why that is a popular option in CA. The housing market is crazy over there. It seems like everyone that can beg borrow or steal wants to own a house in CA. This is really big in the SF area. Lots of jobs, good climate, etc. In the Bay Area itself they have pretty much built out. Lots of older homes are being bought and torn down, remodeling into the newer McMansions. Why do this? Closer to work and local entertainment. Many developments have sprung up in the outer counties/cities of the metro areas. It's a shame the way the market has inflated over there. So many people who really can't afford a home get one, to lose it, and suffer. It's greed, and the need to have what the Jones' have.

Cyclist's picture
Submitted by Cyclist on Sat, 08/11/2007 - 11:25am.

My old house in the LA area just sold recently for $535,000. It's a three bedroom 1 bath house with about 1050 sqft and built in 1952. (I now wish I had held on to it!!!!)

One thing to remember as credit gets tight houses will not sell and soon gravity takes over brings these prices down. I would hate to support a house note which is more than what the house would bring on the market. But that could happen.

Another issue is the impact on the county tax rolls due to declining market value of homes. As this value decreases so does tax revenues. This can get interesting.
Conservatism – apply it directly to the forehead.

Submitted by skyspy on Sat, 08/11/2007 - 12:20pm.

It could get interesting but we have to fight the county on assesments. They are still under the impression that the value of homes here is going up. It has been stagnant for a year at least. This year I'am going to fight them on the assesment. The market for homes is dead.

Submitted by too bad on Sat, 08/11/2007 - 8:46am.

while I am no economist, I disagree with you. I have never seen such preditory lending in my life as what is going on now. I feel that we need to restrict new building, till some of the taxpayers sell their houses that are on the market. In my eyes, we owe the taxpayers a debt of helping them sell their house. We have a glutt of houses here, not too few for too much. Some peope are really hurting cause they moved out of their old one and bought a new one, thinking their old one would sell right away. They are now eating 2 house notes.
As for the banks, they are hiring people for low rates as always, and you have the gluttens at the top with multi million dollar saleries. I seriously doubt these people are walking away empty handed from these bankrupt companies.
I think you might look as always at the upper management of these companies for clues as to what went wrong. Anyone rememeber ENRON?, they ran an oil company into the dirt for God's sake, and that is do! A good example, different industry, was Delta's 'Dream team' brought in to 'save' them. Michelle Burns, was brought in to take charge of the money. After 9/11, it came to her attention that even though the pension fund for retirees was fixed so it couldn't be gutted, the pension fund for the Widows and orphans wasn't. Most of the 40+ million used to fund the dream team's bankruptsy proof pension they walked away with after a year or so of service, came from this money. Hard to believe, but true. After they made short work of Delta, other company exs with the same morals were only to willing to hire them to help with their hatch jobs. The problem is greed, and our government knows it, they are buddies.

Submitted by onlyrealcat on Sat, 08/11/2007 - 5:43pm.

And the bank makes more money- more money - more money! Meanwhile, most of the folks getting robbed is the black folk. How nice! I bet if it was a white company like chrysler or haliburton they would'nt take the house and the money - it would be a bailout!

The only real cat in town

Submitted by skyspy on Sat, 08/11/2007 - 10:23pm.

Do you want some cheese with your perpetual whine??

Stop feeling sorry for yourself. Nobody owes you anything. Work hard! Being successful is a choice, not a birthright!!!!

Denise Conner's picture
Submitted by Denise Conner on Sat, 08/11/2007 - 10:43pm.

Stop feeling sorry for yourself. (Don't we all need this advice every now and then.)

Nobody owes you anything.

Work hard!

Being successful is a choice [or a series of choices], not a birthright!!!!

Worth repeating! Smiling

Submitted by dollaradayandfound on Sun, 08/12/2007 - 7:48am.

Apparently this one was censored, from you. I usually don't open yours, but I tried that one due to the title! It wouldn't open!

Denise Conner's picture
Submitted by Denise Conner on Mon, 08/13/2007 - 1:29am.

You can find it under "F’ville arrests 24 for drugs, alcohol" by Ben Nelms (08/07/2007) on page 2+ (or page 1 if you have 90 comments per page as the option). Smiling

You can go there by clicking on this link: $ -- Alcoholism

Surely you don't think that I'd be censored. Laughing out loud

What do you mean that you don't usually read what I type! Puzzled Shocked

Have a nice day! Smiling

Submitted by skyspy on Sat, 08/11/2007 - 10:50pm.

Sometimes I think I'm the only one who hates crime, and laziness.

I'm going to take my telescope outside see if I can see the persid showers.

Have a good one. You are an impressive search engine. I always learn something new by reading your posts. Thank you for that too.

muddle's picture
Submitted by muddle on Sun, 08/12/2007 - 8:36am.

We're at our place on the beach for a few days. I had forgotten about the Perseid meteor showers, but got up at 4:30 a.m. yesterday to go sit on the balcony. The night sky is quite visible here, and Orion, the Bull and Pleades had just come out of the ocean. I was stunned to see meteor after meteor shooting through the constellations. Then it was like, "Oh yeah! This is August!"

The great thing about it is that the moon is not up until about daylight, so the night sky is even more visible. (The moon itself, a mere crescent, was gorgeous when it came up out of the ocean a bit later.)

The news suggests that the peak is Monday. I'll be out there tonight/tomorrow.

All this after getting to see Endeavor go up, too!

"Two things fill the mind with ever new and increasing wonder and awe: the starry heavens above me and the moral law within me."--Immanuel Kant, Critique of Practical Reason

Denise Conner's picture
Submitted by Denise Conner on Sat, 08/11/2007 - 11:08pm.


Too bad more parents don't instill hating evil and develop good character in their children (at least make every effort).

Have you ever read anything by Star Parker? I admire her getting off welfare and developing good character qualities to turn her life around. There are some who correct the downward spiral of their lives, but not many. It's too easy to blame others and get a government hand-out.

Have you ever heard Jesse Lee Peterson (BOND "Rebuilding The Family By Rebuilding The Man")? He doesn't tolerate Jesse Jackson's antics.

Enjoy the stars. Smiling

Cyclist's picture
Submitted by Cyclist on Sat, 08/11/2007 - 7:31pm.

I guess you're not keeping abreast of current events but sub prime lenders and other home mortgage companies are either seeking bankruptcy or getting out of the business.

Conservatism – apply it directly to the forehead.

Submitted by wheeljc on Sat, 08/11/2007 - 10:22am.

To the individuals who elected to 'pay two house payments', WHAT WERE THEY THINKING? That a good fairy was going to come along and help them make the payments?? In all candor, the situations that you describe could be avoided with a bit of disciplined planning. Who held guns to their heads and made them sign the deals?
We live in a Country where freedom prevails. Freedom to achieve tremendous goals when we do smart planning and programming; and a freedom to FAIL when we don't!
The housing market in the Metro area is growing because of demand. Atlanta is growing! If folks want to sell an existing home they HAVE TO COMPETE! (Would suggest they start listening to Dave Ramsey on a local AM station.) What we do not need is Nanny Government getting involved. Let's just hope that those who made a bad choice on a loan learned from the mistake, and for Pete's sake, if you don't want to be paying two house payments, DON'T BUY THE SECOND ONE UNTIL YOU HAVE SOLD THE FIRST!!!!

Submitted by too bad on Sat, 08/11/2007 - 11:13am.

they bought another house...cause they do have good credit...and..they felt the house would show better. My friend's mother use to be a broker and sold one of the bigest real estate companies in this area, she learned from a real pro in the market what to do. The house shows like a dream. This is one of the more sought after neighborhoods in this area. People use to drive by waiting for a for sale sign to go up. Now we have houses here that have been on the market for over a year. Hers is the only one that is getting any showing. Reason? we have a glutt in this area. Old homes are competing with new homes that are sitting vacant. A lot of the people who bought into this no interest loan deal were people hoping to turn a buck and put it down on a more modest home they could afford. The market has gone south and with it their dreams. What are we doing to help get the excess off the market? Nothing. It is irresponsible to keep building houses in an overbuilt market. Developers rights? Well the last time I looked, they have to go before the towns and counties planning boards to build. why? because what is best for the people of that area is suppose to figure into the deal of does he build or don't he. Does he get to screw the taxpayers with more houses, or should they let the surplus get bought up first and help the taxpayers who have given them money all those years, move theirs first. Like it or lump it, that is the way it was designed to go. However, some of these people, for whatever reasons, don't do what is wanted for the taxpayers. I can remember a few years a go in Tyrone, people at town hall screaming at the top of their lungs ..NO..! to the latest Weiland deal. The mayor voted for him and the deal over the taxpayers loud protest. In a weekend they got enough signatures to start the process to get her out of office. She ran off to a good lawyer to stop it, or she was gonna be toast. What we ...need.... is not Nanny government for the big developers and lenders, what we ...need... is a responsible goverment both local and federal that looks to the voters people's interst first. You assume everyone with bad credit deserves to be a victim of preditory lending and should feel glad that get it cause they don't even deserve that. You are wrong. Many people for many reasons, develope bad credit, with help and not victimization, some pull out. I have no interest in helping someone who wants to make the problem worse. It is suppose to be a government of the people and for the people, not a deal to help bad excs get big paychecks for bad preformance.

Submitted by skyspy on Sat, 08/11/2007 - 12:15pm.

I hear you and agree with some of what you are saying. On the other hand these frumpy, dumpy family people have TRASHED their homes. Honestly after looking at some of them it would be more cost effective to just tear them down and start over. The tired dated wallpaper and carpet suburbia frumpy look doesn't sell.

If people would maintain there homes they would sell. Remodel them, stay updated. The problem is most of the family people in this area, barely, I mean just barely squeaked into their homes on a subprime loan. Apparently they can't afford to maintain them. I assume that they can't afford to maintain them, because surely there can't be this many people with bad taste.

hutch866's picture
Submitted by hutch866 on Sat, 08/11/2007 - 11:32am.

If a person owns the land and if what they want to do with it fits into the land use and zoneing plans why should they have to wait till you sell your house at maybe some inflated price before they can develope it. why should the government tell them what they can do with their property. Why should older homes have an edge? How does someone building a house srew me the taxpayer? Maybe you should move to China or Cuba I'm pretty sure they'll tell you what you can do with your property, that is, if they let you have any.

I yam what I yam...Popeye

Cyclist's picture
Submitted by Cyclist on Sat, 08/11/2007 - 11:43am.

I agree with hutch. How can you tell a property owner that he cannot sell or develop his/her property. I would hate to be the public official that mandates that. That public official would be in court real quick as the propery owner would be a little upset.

Conservatism – apply it directly to the forehead.

hutch866's picture
Submitted by hutch866 on Sat, 08/11/2007 - 9:38am.

So you're going to tell one person he can't develop his property as he likes untill another person sells their house, how do you figure thats fair, and as for the lending, the banks were taking a huge risk even lending to these people so why not charge what they want, the lendee didn't have to take the mortage. It's obvious you don't believe in personal responsibility, just do what you want and let the feds bail you out.

I yam what I yam...Popeye

Submitted by too bad on Sat, 08/11/2007 - 4:39pm.

How would you like a liqure store or whore house next door? People are told every day what they can and can't do with their property as far as building. But going back to the problem, the bank gets to make more off these people which I think is wrong, but then they get to forclose, and as I understand, they have the shortest time to forclose here in Georgia, so, so far they are not hurt right? I think if you are deliquent 2 months, they can forclose. Now, just to see what it is all about, I have looked at some of these interest only loans in the past on the internet, and unless I missed something really big, I don't get it. All the money you pay in the beginning goes toward interest, in other words the banks gets theirs upfront. Then the difference in payment is very small, sometimes less than $100.00 a month, so what is the big deal? They don't seem to have any apeal. It is something else, as I said, if the person can't qualify for a $1500.00 note at 05%, why would you qualify them for a $1700.00 at .07%? cause you hope to make a killing off their misery. The problem comes when the bank has made their money except the last 2 months, then forclose. Now they have the house ...and the money... but wait...everyone has a house for sale! ...and they can't unload it... another reason for a moratorium on new subdivisions till some of the slack is taken in. Then your old banker friends get richer, but maybe these people that are in over their heads, get a chance to sell their house before they loose it and walk away with a little instead of a lot, but wiser. And as I said, not everyone has poor credit cause they don't want to pay their bills. Some marry loosers, who milk them dry and burn their credit and they get out with the clothes on their back, and a looser who ain't gonna pay child support as Daddy. Others, may have a terminally ill child and no insurance, or insurance that will only pay a small amount. They deplete everything for their child. The list of reasons for good people on hard times is long, and some of them, are the sames ones that caused our ancestors to move here.
Anyway, most banks have low paid people at the bottem, but obscene, and underserved saleries at the top...(Delta's dream team)...these overpaid people often make bad, but self serving, decisions (gutting the widows and orphans penions fund to fund their own, as in Delta's dream team). Then rather than being punished for such behavior, they are often sought out by other exes wanting help to do these same sort of self serving things at their companies. Again, the problem more than it looks on the surface.

hutch866's picture
Submitted by hutch866 on Sat, 08/11/2007 - 4:46pm.

I don't have time to read your whole rant right now, but go back and read mine and you'll notice I said if it conforms to the land use and zoning, now if you live where its zoned for the cat house my condolences, maybe the feds will bail you out. Do you ever have cheese with all that whine?

I yam what I yam...Popeye

Submitted by too bad on Sat, 08/11/2007 - 9:13pm.

sometimes things are zoned for things and what is preposed is turned down. Same reason, the government is suppose to be about what it best for we...the people...not ...I...the developer....

I have lived my life with compasion, honesty, and truthfullness, I wish the banks/ lenders would do the same.

What is strange to me is you keep pushing the rights of the developer and not going anywhere ...near...bad management, poor peoples rights, and most important bad excs with vulgar saleries....with no accountability...could you be one of those, or hired by/flunky of///such people? All my childhood, I was taught compassion, I believe in it, it doesn't matter if anyone is black or white, I'm white, I just do not belive in making it off the backs of others....and I come from a long line of people who feel that way...ever heard of the >>>Montgomery GI bill? the person responsible for it had paid his dues, and gained nothing from it, other than making it right in his heart and his compasion for others...he is a relative..I come from a long line of people who want to do right for others, not for gain, but that it is the right thing todo.

hutch866's picture
Submitted by hutch866 on Sun, 08/12/2007 - 12:00am.

I'm only pushing personal rights, if you've read the blogs you'd know I'm just an a/c repairman, not a banker or any kind of big money type, I used some of my G.I. bill so you can take that and shove it. I 've paid my dues any way you look at it, I'm a vet, are you ? Unless you are don't stick that in my face. the whole time I've seen you posting on these boards you've done nothing but cry, the Feds should do this or that. If you don't like the pay of the execs don't buy their products or go buy their stocks and vote them out, but you can take your self rightous bs somewhere else, I ain't buying it.

I yam what I yam...Popeye

Submitted by skyspy on Sun, 08/12/2007 - 12:25am.

Sop using your credit cards. Stop giving these slobs your money. Don't let their brokers talk you into a bigger home or interest only mortgage. If it was a good deal for you you really think they would be offering it?????

Now stick it to the man and stop using your credit cards!!!

Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 1:28pm.

I can certainly appreciate that perspective. As a major air carrier with yearly revenues in the billions – in the good years- my company faces the same issue. But we cannot stop taking credit cards as this is an accepted way off payment. I can assure you, if we stopped taking CC’s our competition would trump that to their advantage. Additionally, as our economy becomes more and more virtual, cash will not be as prevalent as the time of our forefathers. In the end, the CC burden is passed along to the consumer.

Conservatism – apply it directly to the forehead.

Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 6:20am.

Rather than not using credit cards, how about just paying the credit card off each month. That way you use their money for free and you get whatever rewards they offer!!! If your credit card has a fee structure and no rewards then, go someplace else.

Conservatism – apply it directly to the forehead.

Tug13's picture
Submitted by Tug13 on Sun, 08/12/2007 - 5:35pm.

I agree. I have one credit card that I use once in a while. I pay it off every month.
We taught our children to do that too. Hopefully they will teach their children the same. Smiling

Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 5:53pm.

Life is too short to pay CC interest.

Conservatism – apply it directly to the forehead.

Git Real's picture
Submitted by Git Real on Sun, 08/12/2007 - 6:54pm.

Life is too short to pay Credit Card interest.

Learn it and live it. Smiling

Buddy...If that isn't a statement to live by I don't know what is. Did you "Joe Biden" that statement or did you come up with that one on your own. Regardless, I'll be using that line often when counseling with young folks on finances.


"That man was Griffin Judicial Circuit District Attorney Scott Ballard".


Submitted by dollaradayandfound on Sun, 08/12/2007 - 8:16pm.

Boy, that does sound intellectually sound and impressive, doesn't it?
Now, boys and girls, don't pay any credit card interest---it is bad for you!
Now, I know the President owes Japan and China Trillions and pays them interest, but he is a big boy, and you are stupid---so just don't do it! You hear me?
What I want you to do is go talk to your banker, any banker, and get his advice about whether you need one of his bank's credit cards. You just do whatever he says and you will be OK.
He may even give you one, I don't know, but if he does, be sure and don't pay any interest.

Git Real's picture
Submitted by Git Real on Sun, 08/12/2007 - 8:47pm.

If you were here right now I'd give you a noogy and a wedgy right before I crowned you with your momma's panties. Smiling

With that said..... I kind of like you. You old grumpy goat. You remind me alot of Ralph Kramden.



"That man was Griffin Judicial Circuit District Attorney Scott Ballard".


Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 7:01pm.

I sometimes surprise myself. I'm really not that intelligent. If you really want to know, I thought I had an understanding of events until I came on board. Boy was I naive!!!!
Conservatism – apply it directly to the forehead.

Git Real's picture
Submitted by Git Real on Sun, 08/12/2007 - 7:15pm.

Until the day we die. Unless you're a Clayton County Ghetto Thug or Trailer Trash. In that case they were through learning at the age of 6.

I thought I had an understanding of events until I came on board.

Yup... you can learn alot of different perspectives from these blogs. It'll get you to thinking for sure.


"That man was Griffin Judicial Circuit District Attorney Scott Ballard".


Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 7:19pm.

I'll be broadcasting from Houston, TX. till Wednesday.
Conservatism – apply it directly to the forehead.

Submitted by dollaradayandfound on Sun, 08/12/2007 - 7:59am.

Then all the bank does is raise the amount they charge the retailer when you use the card. Who pays that eventually?
Banks charge both the cardholder and the retailer.

Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 10:55am.

It's a vicious circle. But the point, is that you don't pay interest on your credit cards. You pay them off every month. If they increase usury fees it is spread out among all card users. If you don't like that then pay cash.

Conservatism – apply it directly to the forehead.

Git Real's picture
Submitted by Git Real on Sun, 08/12/2007 - 12:52pm.


Sky Spy and Dollar are dead on with their credit card comments. The merchant always gets stiffed with the hefty bill in the end. As I've learned recently the hard way, that includes the fraud charges. If you dispute a fraud charge you would think that the bank would assume the charges for the fraudulent charges. Not so. The merchant gets tagged with the cost of the goods or services and the bank loses nothing. They even tag the merchant with an extra charge for taking the card in the first place along with the normal fees they nailed him with. All this in spite of the bank approving the charge in the first place and submitting an approval code.

Do your local businesses a favor and pay cash when possible. Let's leave the profits with the small businesses to help them pay their expenses, employees and try to give them a bit more in their pockets to take home. They deserve it more than the banks.

Ok... Now a side note to Maple Leaf. Spare me the bankers view of how wonderful the credit card is for the merchant. We saw your arguments HERE. CLICK HERE FOR RELATED BLOG. As a business owner who pays between $5000 - $8000 a month in fees I'd much rather have the cash. So spare me on the virtues of the credit card. That line is as phony as the the other one the banks propagated on the public. You know... A family needs to have a home mortgage so they can get the tax deduction. The ole "Spend A Dollar To Save A Dime" nonsense.

Credit cards are as destructive to most families as drugs and alcohol are.


"That man was Griffin Judicial Circuit District Attorney Scott Ballard".


Submitted by skyspy on Sun, 08/12/2007 - 6:28am.

Thats an even better idea. So many people have a hard time living within their means.

Success is a choice not a birthright.

Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 6:32am.

100% correct "Success is a choice not a brithright" See ya, I got to get to chruch.

Conservatism – apply it directly to the forehead.

ManofGreatLogic's picture
Submitted by ManofGreatLogic on Sat, 08/11/2007 - 11:11am.

Let the market sort it out. The government doesn't need to help the borrowers. Likewise, developers and lenders should get no help or tax breaks from the government. Let the market sort it out.

Republicans like to hype their "no government involvement" stance, but what they really mean is "no government involved in helping the consumer." They still like their tax breaks and corporate welfare.

We don't need a Federal Reserve. It's unconstitutional, and isn't even a government entity. It's private, and it manipulates the economy----OUR economy. They'll tell you the Federal Reserve is headquartered in Washington DC. That's sort of true, but it's really out of London. The world of finance is centralized in London. That's why London is so rich, even though they don't have any resources anymore.

Submitted by dollaradayandfound on Sun, 08/12/2007 - 8:43pm.

If the government doesn't help the borrowers then we will all suffer greatly! Shouldn't have happened in the first place to create this false economy!

You are correct about the "no government involvement" for taxpayers. Plenty for business.

The fed is an entity until made unconstitutional, which it hasn't yet.

London is so rich because they don't have any resources anymore, you said?
Did you mean they were rich, but not now?

hutch866's picture
Submitted by hutch866 on Sat, 08/11/2007 - 1:25pm.

Lets see, the Fed has been around since 1913, but its unconstitutional and no one has challanged it and won for 94 years, right. Of course it manipulates our economy, its supposed to, holds down inflation, sets interest rates, and as far as I know, we don't have a branch in England, maybe you could tell me the address.

I yam what I yam...Popeye

Submitted by dollaradayandfound on Sat, 08/11/2007 - 3:05pm.

The fed was created on our own Jekyll Island by the robber barons of the late 1800s and early 1900s. To avoid calamity, it was done in a very secret way.
London is the world's financial center and has been since at least 150 years ago. They do have the ability to USE our federal bank system when needed!
I don't think street addresses are required for that!
Many do consider the fed unconstitutional in that it can cause depressions as it once did, and also prevent them by releasing huge sums of money to save the banking systems at low interest rates. As they did this week.
Some feel this is a violation of the "let business alone" system, let the market dictate consequences!
If you are a true conservative, you should believe in that.
It is also why some think that we should also save people losing their homes due to faked loans and high interest rates, just as we are rescuing the banks. What say you?
These are difficult problems and not all of us understand them, do we?

hutch866's picture
Submitted by hutch866 on Sat, 08/11/2007 - 4:03pm.

Your BS would be more believable if so much of it didn't involve conspiracy theories.Just how does London use our bank, other then maybe storing some gold there.I thought with you people it eas the Jews who controlled all the money, not the English. Ya'll gonna have to get your stories straight. As for forming the Fed in a secret way, how can you do that with all the Senators and Reps involved? If people are losing their homes to the banks, the loans must not have been faked right? You must be one of those sexual intellectuals I've heard about.

I yam what I yam...Popeye

ManofGreatLogic's picture
Submitted by ManofGreatLogic on Sun, 08/12/2007 - 4:51pm.

We're not talking about conspiracy theories. We're talking about world finance. You need to do a couple things before anyone is going to take you seriously in this conversation: 1. Grow up. 2. Do some research.

The Federal Reserve is only half-honest. It is a reserve (as we saw last Thursday and Friday---for those of you who don't know what I'm talking about, continue watching Raymond reruns). So it can stabilize the economy when things get rough. But to say that they keep inflation down is a joke. Inflation has only existed for about a hundred years. Throughout the entire 1800s, inflation was minute. The reason is that we were on the gold standard. In other words, there was a FINITE amount of money (based on the amount of gold owned by the government), and not an INFINITE amount of money, as is now the case with the "Federal" Reserve (which isn't even federal. It's private).

I don't even know why I'm explaining this to Popeye. He's not smart.

Cyclist's picture
Submitted by Cyclist on Sun, 08/12/2007 - 6:14pm.

A couple of things. Explain how the Bank of London controls our economy or provide us a credible site to research the subject. We don't want opinions. I might add, that from the period of the end of WWI to after WWII, England was damn near flat a$$ broke. Churchill was desperate for Uncle Sam's hand-out. Secondly, you talk about how stable our monetary system was because of the tie gold through out the 1800's. Well the big crash of 1819 caused a very bad round of deflation which was not supposed to happen but it did.

Conservatism – apply it directly to the forehead.

Tug13's picture
Submitted by Tug13 on Sun, 08/12/2007 - 5:22pm.

You could have disagreed with Hutch without the derogatory remarks.
You think you're smart? Maybe a smart aleck.

Have a nice evening Smiling

Git Real's picture
Submitted by Git Real on Sun, 08/12/2007 - 7:02pm.

According to ManOfLocoLogic you are:

1. Immature
2. Lack Research
3. Sit-Com Addict
4. Joker
5. And You're Not Smart

Well... other than that, I guess he's alright. Eye-wink


"That man was Griffin Judicial Circuit District Attorney Scott Ballard".


hutch866's picture
Submitted by hutch866 on Sun, 08/12/2007 - 5:12pm.

If you want to drag this down in the gutter we can go there. If you want to get personal we can go there too. the Fed is not private, it's set apart to keep our wonderfull congress people and the senators from adjusting everything to suit them, just because you get elected to office doesn't make you an economist no more then the fact you call yorself logical means that you are. The fact you agree with dollar is enough to discount anything you say. Since we aren't on the gold standard anymore the Fed does keep inflation down. Now for the gutter and personal part, bite me.

P.S. The conspiracy theory thing was for dollar not you, yours is merely stupid

I yam what I yam...Popeye

Submitted by dollaradayandfound on Sun, 08/12/2007 - 8:06pm.

You are never going to understand economics, so I'll just speak of hutch's conspiracy theory that I supposedly have.
I'll just say this: If republicans are responsible for something, it is NOT a conspiracy, it is what is needed for them.
If democrats are responsible, then it IS a conspiracy against the republicans!
That of course is opinion.
The facts are that the Fed was conspired by very rich dudes to keep them from going broke in a fall. They did nothing to protect you and I unless we had some money in their bank!

Submitted by dollaradayandfound on Sat, 08/11/2007 - 4:55pm.

Things were done somewhat differently in our government in the late 1800-early 1900s.
Lobbyists, who now write our legislation for the congressmen, was then written by people like Jay Gould and J.P. Morgan, and friends when it came to money, railroads, oil, etc.
It was then presented to congress to maybe add earmarks and passed.
We are living more and more in a one-world economy. What effects one country or region effects all. So, when such a fiasco as the current housing loan default occur, London helps us, and when they have a problem we help them with the fed.
They buy our poor quality home loans, in other words.
However, now that the number of repossessions or non-producing loans has increased tremendously lately, they are trying to get rid of them. They don't have enough money coming in from these loans to pay their creditors! Those creditors are sometimes our fed!
As to the Jews, they influence publishing, movies, and retail, but are no more into banking these days than anyone else.
I hate the Scots, myself, for that rot-gut they produce!
This subject would be an interesting one for you to study for awhile. Maybe you could subtract your opinions on some of my "BS?"

Submitted by skyspy on Sat, 08/11/2007 - 12:06pm.

My thoughts exactly. W loves to bail out his sorry buisness friends.

Where have you been?

Last night on Leno the best joke was the w ratings have actually gone up now that he is on vacation and not doing the job he does so poorly.

Go figure

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