Re: having enough sense not to borrow the entire amount … if only having “enough” sense were more common, then it would be common sense! Seems to be in short supply though.

Inasmuch as I fell slightly short of the requirements for top-grade loans myself, I am at least somewhat reluctant to condemn the whole idea of subprime mortgages as evil/wicked/stupid/whatever; if they’d been truly hardassed about things, I’d still be in the CrappiFlats™ to this day.

That said, I did have enough sense not to borrow the entire amount they were willing to finance – why ask for trouble? – and I’ve kept up the payments quite respectably.

But of course, it wasn’t a screw-up at all, in the minds of ACORN and other like-minded extortionists, who threatened lawsuits against banks that didn’t make loans to every stiff that walked in the door. Guess who used to be one of those attorneys? He’s running for president now. (cue jeopardy theme)

This is foolishness. Yet all the press coverage is about Wall St., Republican lobbying groups, deregulation, etc. OK, fine, let’s look at that, and while we’re at it, let’s look at government-mandated extortion so that rich white liberals in Washington could look good and buy poor black votes. Right? That’s what is really going on here, at least in large part. Who are we kidding?

Huh. Trading money and favors for votes. Yeah, sounds like “change” to me! Also, “Chicago politics”. Better put on your cynical hat, you’re going to need it.

As for Wall St., I don’t see it had much choice; once that horse was out of the barn, the competition was on to make money from it, somehow. Staying out of the game is probably not really an option.

Yes, greed is a problem, but it starts in Washington, with the gravy train they enjoy at our expense. I’m more interested in fixing that.

My $.02 anyway.

The Community Reinvestment Act catches a lot of flak, much of it undeserved, for contributing to this mess. The CRA dates back to 1977, not a great time for the economy, but not one reeling from a credit crunch either.

The real impact of fecal matter against air-movement device came when the Clinton administration, responding to community-organizer types, moved to allow the securitization of subprime loans. Again, this didn’t cause a problem in itself, until Wall Street moved into securitization in a big way. (By most accounts I’ve seen, Bear Stearns was the first to take the plunge.) Add to this the mandate given to Fannie Mae and Freddie Mac to greatly increase the number of loans given to borrowers of lower qualifications, and the fact that packaging all these things into third-party units drew lots of investors hoping to use $1 of their money and $20 of other people’s, stir, allow to boil over, and only then uncover. It’s a recipe with a whole lot of cooks. Call it a fearsome example of the Law of Unintended Consequences.