GSEs were definitely problematic. They were not the <i>root cause</i> of the crisis by any stretch of the imagination. It is a convenient scapegoat of market fundamentalist types who abhor looking at data. The biggest lenders were non-banks <i>not</i> covered by the CRA. After the banks got involved, they were chasing fat profits, not out of a public mandate. The vast majority of loans were bought by Wall St., not GSEs -- i.e., the percentage of the subprime loan market represented by what was ultimately on the Fed's balance sheet was a fraction of the total market. I do agree that low rates played a causal role in the speculation, but that has nothing to do with Fannie and Freddie. I am just not hindered by a need to chase away cognitive dissonance that would rub my ideological positions the wrong way.
Dang. Apparently there is another spot a couple blocks North that I should have checked. Hopefully I'll stroll by there tomorrow. http://www.charlotteobserver.com/2011/10/10/2679054/occupy-charlotte-campers-say-they.html
US companies are evading taxes by opening/operating an office in Ireland. But US citizen must pay income tax to US Gov if he is working in Ireland. Insider trading is legal to US Congress members. And insider trading is illegal to US Citizens. How long this hypocrisy will continue?
The hypocrisy will keep going until the earth explodes. There is no way to completely eliminate tax evasion or tax avoidance strategies. It happens at every level...
The Subprime Crisis: Is Government Housing Policy to Blame? ABSTRACT A growing literature suggests that housing policy, embodied by the Community Reinvestment Act (CRA) and the affordable housing goals of the government sponsored enterprises, may have caused the subprime crisis. The conclusions drawn in this literature, for the most part, have been based on associations between aggregated national trends. In this paper we examine more directly whether these programs were associated with worse outcomes in the mortgage market, including delinquency rates and measures of loan quality. We rely on two empirical approaches. In the first approach, which focuses on the CRA, we conjecture that historical legacies create significant variations in the lenders that serve otherwise comparable neighborhoods. Because not all lenders are subject to the CRA, this creates a quasi-natural experiment of the CRAâs effect. We test this conjecture by examining whether neighborhoods that have been disproportionally served by CRA-covered institutions historically experienced worse outcomes. The second approach takes advantage of the fact that both the CRA and GSE goals rely on clearly defined geographic areas to determine which loans are favored by the regulations. Using a regression discontinuity approach, our tests compare the marginal areas just above and below the thresholds that define eligibility, where any effect of the CRA or GSE goals should be clearest. We find little evidence that either the CRA or the GSE goals played a significant role in the subprime crisis. Our lender tests indicate that areas disproportionately served by lenders covered by the CRA experienced lower delinquency rates and less risky lending. Similarly, the threshold tests show no evidence that either program had a significantly negative effect on outcomes. ---------- Of course the Serious people who believe in crap ranging from Soros helped the Nazi's persecute the Jews to Project Blue Beam, will no doubt dismiss this because it just doesn't jive with their political beliefs. I think the only time an Occupy <insert city name> can occur in West Afghanistan (the South) is if someone in one of those provinces decides to ban the sale of SKOAL due to health reasons.
The Occupy Wall Street crowd has dispersed from Zuccotti Park! They're now occupying the lines outside the Apple Store for the new iPhone 4S.
Soros helped the Nazis, but that was just a job, just like many people who love nature work for Exxon.
As usual, the queen of drive-by partisan posting and ad hominem arguments accuses others of being biased. So a couple of Fed economists do a question-begging study. I doubt you've ever studied econ at the graduate levels, but you "prove" almost anything you want by cherry-picking your assumptions. And if conflicting studies are available, they won't be published. The whole world of publishing, grants and academic research is anything but objective. But it makes for nice soundbites ("this study proves...") that the masses swallow. It's kind of like journalists reporting on medical research as if it's conclusive and not stating if it's an observational study or clinical trial (huge difference). Even the Huffington Post knows the Fed is hardly objective: http://www.huffingtonpost.com/2009/09/07/priceless-how-the-federal_n_278805.html There are endless angles from which you could analyze CRA. Don't expect the mainstream studies to explore ones that are outside their comfort zone and worldview, though: http://www.creators.com/opinion/thomas-sowell/upside-down-economics.html
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