Financial Crisis: Who’s Fault Is It, Anyway?

Doesn't matter.

Because just about everyone is to blame.

Republicans opened the door through debt-based credit derivatives and deregulation. Democrats further contributed by turning a blind eye to Fannie and Freddie and insisting that even those who couldn't really afford mortgages be allowed to get them. The Bush Administration touted consumer spending as a means to boost the economy, and encouraged reckless consumer behaviors with billions in “stimulus”money, all while fueling the national debt through a disastrous war and tax cuts for people who don't really need them.

And, of course, greedy banks and mortgage lenders went along, doing their best to bilk whoever came through door for whatever they could get — before passing the risk on to equally greedy investment banks and hedge fund managers. Consumers came along for the ride, abandoning reasonable financial practices and using credit to fuel materialism — as well as making poor decisions by buying homes they couldn't afford with “creative” mortgage financing.

Nearly everyone shares some of the blame. This is not the time to bicker over who is most at fault. It doesn't matter. The past is past. It's time to move forward and fix the problem. REALLY fix the problem. With practical solutions (that's right, follow the link for just one alternative — and better IMO — solution) that don't involve throwing a large, arbitrary amount of money at the problem.

This is something that requires measured thought. And a change in how our society now views debt, money and the economy. There's no reason to rush into a bailout plan right now. Instead, a little more analysis is needed.

Tags: stock market, Wall Street bailout, financial crisis, spending,
economy, investments, Bush Adminstration

3 thoughts on “Financial Crisis: Who’s Fault Is It, Anyway?”

  1. I absolutely agree with you in that throwing money at the problem isn’t going to do much to help, and could possibly make it much worse in the long run.

  2. SO right. It’s like a $700 billion band-aid that we borrow. It doesn’t really fix the gaping hole, and since we’re not actually treating the problem, it’s going to fester in the long run.

  3. The Community Reinvestment Act played a huge role in all of this mess. Revised in 1994, Clinton forced banks to lower lending standards and put quota’s on banks to make questionable loans.

    In 1999, the Glass Steagle Act was reversed which once again allowed derivatives to be purchased, swapped, and traded (key word Clinton).

    NY TIMES SEPT 2003: BUSH PROPOSED TIGHTENING OVERSIGHT OF FANNIE MAE AND FREDDIE MAC – THE DEMOCRATS OF CONGRESS BLOCKED IT. Fannie and Freddie own half of our nations mortgages.

    From the Board of Directors to the CEO’s, Fannie and Freddie are mostly comprised of staunch Democrat supporters and Clinton
    re-treds. If the maintream media is not blaming the Republicans, then they know it’s the Democrats fault.

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