When he was a child a Christian family took him in and pretended he wasn't jewish. He was forced to take a job working for the Nazis turning in jews who were hiding out. Basically he was just an assistant. Sort of like when I was a kid and my job was to stand in front of the bowling alley and tell all black customers arriving that tonight was league play only.
Accurate intuition. Widespread loan default in the housing market could hardly crash the world economy alone. Plus the facts are simply not there, whatsoever. Reality was quite simply that the private market where loans originated outside CRA and sold to Wall St. dwarfed that of FNM and FRE. Aside from that, GSEs couldn't even loan to unqualified borrowers before 2005. Operating in the "reality-based community" rather than by cognitive dissonance is not easy for the willfully ignorant though.
I don't believe it at all. Never have. All that leverage set the table for a Big Problem, but that table has been set for the past 30 years. IMO the key change was - and continues to be - energy prices. The cost of energy is an input into everything we do. Prices cannot go up 10-fold without serious ramifications - the run from $15 to $100 alone was roughly equivalent to a trillion-dollar siphon on GDP. The important question now, IMO, is..."now what?"
and that energy cost has never yet been fully passed on to the consumer. Everybody has sucked it up all along the supply chain, but the retailer has been afraid to go back to the old margins because business is bad enough already. And Saudi Arabia knows this, they have money invested in business all over the world. Low stable energy for a couple of years would solve a lot of these seemingly unsolvable problems.
I believe there is more to it than that. "Cognitive dissonance" may explain it for some avg Joes, but I have seen this meme repeated so often in the media tv/papers, that it is hard to explain other than as a major public relations effort to redirect attention from the real cause of the financial debacle to a relatively minor, albeit emotion-laden, component. The individuals, media companies, even educational institutions, that supported the "CRA caused it all" thesis were and are highly suspect, and another reason why nothing they "report" should be taken at face value.
yeah MarketMasher, say you're the reporter and you go to the program director with the facts. She says, "People can't understand that. All we want to know is who the bad guy is."
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