I have nothing to do with this

[cema]

As I am not an expert in finances or economics, I defer any judgment on the bailout and its failure.

But we are all experts in politics, aren't we. Do I understand it correctly that the basic driving force behind the current financial troubles is a failure of a socialist experiment in the housing market? Or is it only part of the problem?

And the politicians, as usual, will blame someone else. (And everybody else will blame politicians.)

It is interesting to note, too, that more Americans are reported to trust Obama's team on economics than McCains' team. Whereas one would think that it would be the other way.

Update. A bit heated in the comments. Chill out, the world is not going to end right now.

Comments

[gera.livejournal.com]

And, once again, it's getting better. A lack of credit history would almost certainly mean that the person has never had a car to speak of. A poor person could not have afforded to buy it for cash, and if he had had a car loan, he would have a credit history.
And I can't imagine a homeowner without a car, I know none and I've heard about none like that. Life in the suburbs (where most houses are) is all but impossible without a car.
So, that solvent person without a credit history is pretty much is mythical character. Not that they don't exist at all (I was one of them in my first year), but they are very hard to come by. And if they have trouble with all the other criteria it's definitely time for the lender to wake up and smell the hummus. I hope that's enough to give an idea about how much the sentence in question has to do with the reality and also whether or not it suggests a viable alternative to credit history.

The quote peddlers couldn't find actual regulatory enforcement that would require banks to give out riskier loans, and instead they peddle a quote from one member of the board in some address to some bankers about what he thinks the regulatory issues *are going to be*. This is laughable.

First of all, this is not some "board", but the Board of Governors of the Federal Reserve System, of the few people, appointed by the president and the Senate that serve on that little board of which Bernanke is the current Chairman. Not very laughable, I dare say.
And not just "some bankers" but the bankers associations of the richest and most populous state, which has over 300 member banks that hold almost twice the budget of the entire country in assets. Also a little less laughable.
But what makes it so-not-laughable is that those regulations weren't just going to be, they actually were. But more about that below.

I read some statistics saying that the percentage of subprime loans given to blacks is a little bit higher than their presence in the population and those of blacks considerably lower. What you quote doesn't contradict that. It doesn't matter if blacks/hispanics were more likely to get a subprime loan if the total number of subprime loans given to blacks/hispanics is a small portion of all subprime loans (which is the case).

In fact, the important figure is the share of people who actually defaulted. It's not the loan that's the problem, it's the default. I can't seem to find that information about blacks, but I've found it about hispanics:
Latinos make up 14.8 percent of the population, but represent about 21 percent of the subprime default burden.
I am pretty sure it's at least that high with blacks, since they have a similar share of the population and they are worse off economically. So, I find it very likely that the combined share of the two group is nearly half of the subprime default burden.