GDP: US Economy grows at fastest pace in nearly two years. God Bless Bidenomics.

Concart said:
This was simple. There was going to be a run on those investment banks, and they were leveraged far too much to be able to pay their investors off. They tried to dump that crap, but they couldn't. They had purchased credit swaps from AIG, but so had everyone else. AIG was ALSO way overleveraged, and the whole thing came apart. That's way over the heads of people like PMP and Fake Doc. So instead, they rush to their right wing sources and parrot their arguments. Which are all easily destroyed.
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And those arguments always boil down to simply blaming the 'poors' for whatever goes wrong.


There simply is no issue with low income, mostly Sub Prime loans that became available due to Dodd Frank and other legislation being written and put in bundles. The securitization function is sufficiently adequate to assess the higher default rate in those tranches and balance that in a bundle with enough better performing loans to protect the bundle. That is how Sub prime loans are always mixed in, as those buying the bundles want the higher yields they pay mixed in, despite the higher default rates and that CAN be protected against.

but what cannot be properly modeled and protected against is the mass amount of completely fraudulent loans that went in to the bundles, that did not default within any predicted tolerance as almost 100% of them blew up. Fraudulent loans were not written because of Dodd Frank or any other legislation and the lack of those legislations would not stop fraudulent loans being written.

So once again 'The Blame the Poors' argument is just simply one that republi'cans' resort to, to take the heat off of the Institutions who turned a blind eye to this, for short term profits and to focus that blame where they know derp Magats love to go, which is 'Blame the Poors'.
 
QP! said:
And those arguments always boil down to simply blaming the 'poors' for whatever goes wrong.


There simply is no issue with low income, mostly Sub Prime loans that became available due to Dodd Frank and other legislation being written and put in bundles. The securitization function is sufficiently adequate to assess the higher default rate in those tranches and balance that in a bundle with enough better performing loans to protect the bundle. That is how Sub prime loans are always mixed in, as those buying the bundles want the higher yields they pay mixed in, despite the higher default rates and that CAN be protected against.

but what cannot be properly modeled and protected against is the mass amount of completely fraudulent loans that went in to the bundles, that did not default within any predicted tolerance as almost 100% of them blew up. Fraudulent loans were not written because of Dodd Frank or any other legislation and the lack of those legislations would not stop fraudulent loans being written.

So once again 'The Blame the Poors' argument is just simply one that republi'cans' resort to, to take the heat off of the Institutions who turned a blind eye to this, for short term profits and to focus that blame where they know derp Magats love to go, which is 'Blame the Poors'.
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In the early 2000s Congress passed Reg AB, which required sellers of Mortgaged Backed Securities to disclose the makeup of the loans in those securities on a publicly available website. I was a consultant on the development of that website for GMAC mortgage. I saw the state of those securities. All aspects of the makeup of those loans was disclosed. I distinctly remembering being surprised at the high LTV and high default rates in those instruments, but I just assumed they knew more than I did. I wished I would have acted on that hunch, but I didn't for a couple of reasons, the primary one being a concern that I would e accused of having insider information, even those this information was ultimately disclosed on the website.

Bottom line, this thing was coming, but the greed at the investment banks left them blind to the inevitable. But they got away with it because they once again sold the idea that it was the Democrats fault, and these stupid fucks believe it.
 
QP! said:
It is you who does not understand what we are discussing.

These mortgage bundles, these Securitization structures, pre 2008 and pre any Fed Guarantee, were ALWAYS cross collateralized and utilized leverage to the maximum.

What that ALWAYS meant, was if any of the groupings (from Prime to Sub Prime) performed far more poorly than the tolerance allowed for, it COULD and WOULD force the collapse of the ENTIRE bundle as the banks would seek to recoup their money from the failing loans, by liquidating the better performing loans.

There simply IS NOT the option, you seem to think exists, to simply pull out the block of bad loans and let them collapse, costing the banks money, and leave the better loans untouched for your own profit.

That is NOT how the system has ever worked and the Fed Guarantee has NO IMPACT on that aspect.


And believe me, I get that we are talking real estate law about 200 times over your pay grade and your only thought now is 'hurr durr, i just sign judgement documents against people who do not fight back', but you are wayyyy over your head here and, once again show absolutely zero comprehension of real estate law.
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sorry, but not a single thing you said is true.....go way and stop annoying our readers with your stupidity.....
 
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Lionfish said:
When you double the money supply through inflation, costs increase accordingly.
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Increasing the money supply helps cause inflation, not the other way around. You do not increase the money supply through inflation; you increase inflation through increasing the money supply. Or more often, inflation is increased through increasing the velocity of money.

The money supply was not doubled. It was increased by 40-50%. Two thirds of that was trump. Biden has reversed that, and we have the first decrease in money supply since the Great Depression. Never before has America fought inflation so hard.

https://fred.stlouisfed.org/series/M2SL

Lionfish said:
The fact is that profits are not at record highs
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Because we are actively fighting inflation.
 
PostmodernProphet said:
wrong.....if the federal government hadn't guaranteed the loans we could have let a half dozen badly run banks close and get bought out by smarter banks.......happens all the time......
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The FDIC arranges for poorly run banks to be bought out by better banks, through guarantees. If you remove the FDIC from the equation, there is no reason for a better run bank to buy a bunch of bad loans.
 
Hawkeye10 said:
Does your lived experience indicate that the American economy is great?
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My Roth IRA is insanely high. At fifty nine and a half, I will have a solid six figure income tax free for life, and leave a hefty tax free inheritance to my wife and children. That is on top of the nearly seven figure income I have now.

So yes, I am happy with this current economy.
 
Into the Night said:
That cheap money to make those loans was provided by the Federal Reserve (not the Chinese).
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The world was awash in cheap loans. If it were only the USA, you might have a point, but the Federal Reserve does not provide cheap loans to the whole world.
 
Walt said:
Increasing the money supply helps cause inflation, not the other way around. You do not increase the money supply through inflation; you increase inflation through increasing the money supply. Or more often, inflation is increased through increasing the velocity of money.

The money supply was not doubled. It was increased by 40-50%. Two thirds of that was trump. Biden has reversed that, and we have the first decrease in money supply since the Great Depression. Never before has America fought inflation so hard.

https://fred.stlouisfed.org/series/M2SL



Because we are actively fighting inflation.
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Trump does not increase the money supply. The Federal Reserve does! It is controlled by CONGRESS.
 
Walt said:
The FDIC arranges for poorly run banks to be bought out by better banks, through guarantees. If you remove the FDIC from the equation, there is no reason for a better run bank to buy a bunch of bad loans.
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The FDIC is not supposed to guarantee loans, dumbass!
It is supposed to guarantee DEPOSITS. It can't even do that!
 
Walt said:
My Roth IRA is insanely high. At fifty nine and a half, I will have a solid six figure income tax free for life, and leave a hefty tax free inheritance to my wife and children. That is on top of the nearly seven figure income I have now.

So yes, I am happy with this current economy.
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Making shit up isn't going to help you.
 
Walt said:
The world was awash in cheap loans. If it were only the USA, you might have a point, but the Federal Reserve does not provide cheap loans to the whole world.
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In a sense, they DO.

By providing cheap loans in the United States, foreign banks get involved in the loan ponzi scheme. When the loans come apart in the United States, those foreign banks become involved in the the losses. This is exactly what happened with Deutche Bank and why they suffered from the losses so badly.
 
Into the Night said:
The FDIC is not supposed to guarantee loans, dumbass!
It is supposed to guarantee DEPOSITS. It can't even do that!
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Deposits are based on loans. Actually, technically, deposits are loans made to the bank. No bank wants to buy a bunch of failed loans.
 
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