Sunday, 8 March 2009

The Financial Crisis Explained



This video was from February last year, long before the crisis became apparent.

4 comments:

Will said...

It doesn't explain the financial crisis. It's a comedy routine. That is all.

The financial crisis is explained by a close examination of capitalism and it's inner workings (and the contradictions within). Of which, rightist scum and ideologues have championed in a filthy manner for aeons. Economists being the chief lier filth and scumbags that need a time spent in jail.

sumptos devil s advocate said...

Will,

Are you mad that the video expressed a view you disagreed with?

Also, to say that what we had in the last 8 years was capitalism (in the U.S.) is nuts. We had a corporatist system whereby the Fed pushed through the economy a lot of easy money, enabling these banks and "mortgage investors" to push through these "dodgy debts" for so long. Yes, I know Bush--who greatly expanded the size of the federal government during his time in office (both defense and non-defense spending), ran up huge deficits, greatly expanded government interference in the economy, appointed Ben "Helicopter" Bernanke Fed chairman, and tried to bail out the banks--was a hard-core by the book hands off laissez-faire capitalist, just like Hoover--who raised taxes, created a federal program to buy farmers' produce and destroy it, and had enacted the massive Smoot-Hawtley Tariff that destroyed world trade and who FDR's runningmate said was "leading us down the road to socialism." Now, we finally will get CHANGE in the form of bank bailouts, deficit spending, and printing press printing, but with just a little more outspoken concern for the little guy * just a little * in that he'll get the Monopoly mon--oops, I mean money--too.

I think it was a clever video which showed the madness of most government economists and other policymakers these days.

Realtor in Toronto said...

Well, it's a rather unusual explanation but still a good one. Thank you for this video. Nicely talked of the mortgage system failure which to me seems as the real problem of the crisis. Loans and mortgages are what brought the economy down in the first place. Bush administration made a huge mistake by allowing such an easy access to loans to almost anyone.

Take care, Julie

Zoe Brain said...

“The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios…”—Rep. Barney Frank, September 10, 2003, House Financial Services Committee hearing.

“I think we see entities that are fundamentally sound financially and withstand some of the disastrous scenarios. And even if there were a problem, the federal government doesn’t bail them out.”—Rep. Barney Frank, September 11, 2003.

“I believe there has been more alarm raised about potential unsafety and unsoundness than, in fact, exists.”—Rep. Barney Frank, September 25, 2003, House Financial Services Committee hearing.

“Let me ask Mr. Gould and Mr. Raines on behalf of Freddie Mac and Fannie Mae, do you feel that over the past years you have been substantially under-regulated? Mr. Raines?”…Mr. Raines: “No, sir.”…Mr. Gould: “No, sir.”…“OK, then I am not entirely sure why we are here…”— Rep. Barney Frank, September 25, 2003, House Financial Services Committee hearing.

“I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing.”—Rep. Barney Frank, September 25, 2003, House Financial Services Committee hearing.

“ʻI think it is an artificial issue created by the administration,ʼ he said in a speech at a Mortgage Bankers Association conference. ʻPeople tend to pay their mortgages. I don’t think we are in any remote danger here. This focus on receivership, I think, is intended to create fears that aren’t there.ʼ”—Rep. Barney Frank, “Frank: GSE Failure a Phony Issue,” American Banker, April 21, 2004.

“In an interview yesterday, Barney Frank, the chairman of the House Financial Services Committee, said that the president’s comments were “inane.ʼ”— New York Times, “Fannie Maeʼs Offer to Help Ease Credit Squeeze Is Rejected, as Critics Complain of Opportunism,” August 11, 2007.

“I think this is a case where Freddie Mac and Fannie Mae are fundamentally sound. They’re not in danger of going under. They’re not the best investment these days from a long term standpoint going back. I think they are in good shape going forward. They’re in the housing market. I do think their prospects going forward are very solid.” - Barney Frank, July 14, 2008

Bush made 3 separate attempts to toughen regulation of sub-prime mortgages. All were defeated by Congress, and in latter years, the House Financial Services Committee charged with oversight was chaired by Congressman Barney Frank.