With all due respect, your post is quite naive. There was a total of $35 TRILLION in CDS exposure out there, alone. Government intervention had nothing to do with this market decline. LEVERAGE did.
Again, a rather simplistic post. Mortgages were pooled together and "repackaged" by investment banks as asset-backed securities which were then sold to investors who LEVERAGED these positions and securities 30:1
Yes, but that very leverage was created and encouraged by the government. Who allowed the investment banks to lever from 12:1 to 40:1? What boggles my mind is why the US government allows the Federal Reserve to sit back and destroy the currency, and thereby the country. Congress has the power to abolish the Federal Reserve but it sits back and let's this banking system conduct its actions in the name of "economic stability." All for what? Simply, and endless supply of money to feed Congress' insatiable appetite to spend.
Nice assessment PFT.........not just leverage but promoted leverage. To modern day Rome........... "Farewell & adieu to you fair spanish ladies......fairwell & adieu,ladies of Spain......................for we recieved orders to sail back to Boston,thus nevermore shall we see you again"!
True, but you didn't bring it ( LEVERAGE ) up in your initial post. Thank the legislators for bringing us the "Commodity Futures Modernization Act of 2000" But I thought that Bush and Paulson were always advocating a STRONG DOLLAR policy, no?
http://en.wikipedia.org/wiki/Commodity_Futures_Modernization_Act_of_2000 allowed the banks and brokers to create and sell bets while throwing-out all fiduciary responsibility