So, am I the only one seeing financial problems worsen on the Wall Street?
Today was a pretty shitty day for Wall Street.
Fed's gonna have to move in to cut the overnight rates even further.. which is gonna drop the dollar down some more.
Yeah it's the market correcting itself, but it still hurts everyone for now.. especially the abroad webmasters when they do not get much for their USD.
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It will get worse, hasn't hit bottom yet.. This has been many years in the making.. and frankly they're not doing anything to "fix" what's broken.
it's nothing very unexpected imho. but yes, shitty consequences in the near term.
Just a tidbit of info: it was mentioned today that the only two major private investment banks left are Goldman Sachs and Morgan Stanley. Guess which two banks were also playing the oil market - supposedly to a much greater extent than their contemporaries - during the huge increase in oil prices earlier this year?
I wonder if they would have shared the same fate as the others who have fallen, causing an even greater financial collapse, if they had not been able to partake in the oil market due to the more stringent regulations some would like to see in place.
IMHO - It's not gonna be over till the housing prices are back in line with reality and all the exotic derivatives that funded the mess are marked to market.
Watch the Case-Shiller numbers... Looks like we have another 20-30% to go and I wouldn't be surprised by an overshoot on the down side.
If there had been more stringent regulations and oversight in the first place, the extent of this never would have happened. Unchecked greed destroys.. This industry is just one perfect example out of many...Originally Posted by AmateurFlix
At one time we did have stringent regulations of the financial industry, it was called the Glass-Steagall Act and it was passed after the great Depression to prevent this kind of thing.
It was repealed in 1999 by the Gramm-Leach-Bailey Act.
Why am I not surprised to see Phil Gramm's name on there.. He was also one of the driving forces behind "secretly" getting the Commodity Futures Modernization Act of 2000 passed which was the "Enron" loophole.. That act also bares some of the blame for the mortgage crissis and the current oil prices brought about by rampant speculation.
Isn't Phil Gramm the chief economic adviser for McCain? I think McCain called him his "economic guru" or something like that....
he is a former adviser, resigned last June, I think it was.
here's something you might find interesting that Obama was involved in, a lawsuit forcing banks to make loans to applicants which the bank had determined by their own criteria to be unqualified. The lawsuit was packaged in a civil rights wrapper, but the end result was that banks were forced to make loans to borrowers that they would not have lent to previously. This sub-prime lending market then serviced not only those specifically mentioned in the civil-rights lawsuit, but many others the banks previously would have been free to reject.
good quick read on the topic: A trillion here, a trillion there, pretty soon we're talking about real money
and this sums it up quite succinctly:
Obama had a part in the lawsuit that started the government on a course of forcing lenders to give more loans to those who had poor credit. Lending companies were forced to come up with imaginative ways of fulfilling the quota that was required. Sub-prime lending was born as a result. The mortgage crises was forecast by many who were able to look beyond the quota.
ummm... the link you posted that may or may not involve Obama was 1 case in Chicago.. What you've written here is highly misleading.. The entire "lawsuit that started the government on a course of forcing lenders" just sounds completely like something that can't be backed up by any real facts, especially since the lawsuit was very specific about lending to those with "similar financial characteristics and credit histories" and that it was settled out of court. Regardless, one has to ask themselves WHAT government forced the banks to do what you're saying. I think that's all that matters in the end.
But I'm not going to get into a debate with you about it as the link in your sig indicates to me your not open minded about these things.
look under "Plaintiff's Lawyers" on the link I provided http://clearinghouse.wustl.edu/detai...erby|caseName;
there's no doubt that Obama was involved in this.
wasn't looking to open a debate about Obama, merely pointing out that while Gramm was in favor of opening up a free market, Obama was in favor of government regulation, and it looks like both approaches played a part in the situation ending up where it is today.
and no, I am no longer open-minded regarding Obama, I have never before seen a candidate with absolutely no redeeming values whose every stance I hold an opposing view on. the guy is an incredibly polarizing figure.
I am however willing to discuss the thread topic with you without interjecting politics if you so desire.... my post was more for the benefit of the other poster who couldn't resist placing McCain's name in this somehow.
Interresting to see what happens to AIG this week. Notice that the dollar is heavily up here in Norway after the decline in oil prices
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Monday was a wild day in the currency market.
The Euro/Usd had a range of almost 400 pips...the most it has ever had. Spreads were wider than normal. Quite frankly, the market was a virtual ATM yesterday.
Hmmm...While it appears Obama was one of the lawyers in this case, surely he didn't really feel that because you are unqualified, you should play the race card.
From your first link,
“Plaintiffs alleged that the Defendant-bank rejected loan applications of minority applicants while approving loan applications filed by white applicants with similar financial characteristics and credit histories”
This is a standard civil rights claim. Nobody is forcing the lenders to give loans to unqualified applicants.
From your 2nd link.
“Federal laws on fair lending and community reinvestment require bankers to reach out to minorities”
Banks started side steeping the Civil Rights Act by building branch banks only in white communities and then saying we “we don't service” the other communities. The Fair lending laws require the banks to provide service to all communities in specific geographic areas. Banks were not forced to give out bad loans or loans to unqualified buyers. Banks were not forced to give out subprime loans, 100% financing, stated income (Liar Loans), and ARMs.
And the main problem here is quite a bit further up the securitization food chain. These mortgages were resold and packaged into MBS and CDOs. The were given A+ ratings by Moodies and Fitch without any due diligence. These securities were then traded around by the big investment banks who leveraged themselves 50 to 1 without any oversight or regulation. The became know as “Wall Street's Shadow banking system” and the total volume of money traded rivaled the traditional banking system, except they were unregulated.
Trying to blame this on minority lending is just nonsense. I even have a little experience on the ground with this. I did quite a bit of volunteer work with Habitat For Humanity in my city... Habitat and members of the community would build a house for a deserving family, the family had to provide sweat equity, and then Habitat provided a low interest rate mortgage. Then private lenders would come in and try and convince these people to swap out there low interest Habitat loans for ARM. They specifically targeted the Habitat homeowners because they figured they were gullible and uneducated. They would tell these people that they can have a have a check for 10K and then keep paying at the same rate. The were not told that the rate would reset to a higher amount that they could not pay down the road.
Well you've got to look on the bright side, with a weaker dollar at least domain regs and renewals will be cheaper.
Oh wait! Verisign is putting up it's charges at the beginning of next month.
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and evidently the banking industry took into consideration factors other than merely credit history and personal finances in order to determine the borrower's likelihood of repaying the loan. specifically, they found some type of correlation between the location the loan was being applied in and their ability to recoup their investment. i.e., some neighborhoods posed a greater risk than others.
however the lawyers decided that a civil rights group would make more sound financial decisions about how a bank should run itself than the bankers themselves could.
I don't think the article was specifically blaming "minority" lending but rather the practice of opening up lending to those whom the banks had previously deemed as unqualified, which was prompted initially by civil rights claims of unqualified applicants. In fairness I have not confirmed the claims of the second article. However here are some excerpts from it:
- During the 1990s, Fannie Mae pledged $1 trillion in capital over seven years to boost home ownership among underserved populations. Last spring, said Raines, the commitment was completed ahead of schedule, and Fannie Mae pledged a further $2 trillion to assist 18 million families during the next decade.
- Fannie Mae to invest $700 billion in minority housing
- The mortgage industry intends to pursue minorities with greater intensity as federal regulators turn up the heat to increase home ownership in underserved groups.
now I'm no expert on this subject, but didn't Fannie Mae just have some type of a problem?
Fannie Mae?
Isn't/wasn't a former executive of Fannie Mae and consumate Washington insider James A. Johnson an advisor to the Obama team?
The same James A. Johnson that the Washington Post reported:
"was the beneficiary of accounting in which Fannie Mae's earnings were manipulated so that executives could earn larger bonuses. The accounting manipulation for 1998 resulted in the maximum payouts to Fannie Mae's senior executives -- $1.9 million in Johnson's case -- when the company's performance that year would have otherwise resulted in no bonuses at all, according to reports in 2004 and 2006 by the Office of Federal Housing Enterprise Oversight"
Edit: He quit.
"stepped down following reports that he received favorable loan terms from a mortgage lender that Obama has criticized sharply on the campaign trail."
good article.
I found this especially poignant:
While government arguably has a role in helping low-income folks buy a home, Clinton went overboard by strong-arming lenders with tougher and tougher regulations, which only led to lenders taking on hundreds of billions in subprime bilge.
Market failure? Hardly. Once again, this crisis has government's fingerprints all over it.
my stock porfolio right now is down xx,xxx I am so depressed
don't know what to do .
Thank-You
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