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Political Threads This section is for Political Threads - Enter at your own risk. If you say you don't want to see what someone posts - don't read it :hihi:

 
 
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Old 03-16-2018, 09:06 AM   #1
spence
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Originally Posted by detbuch View Post
The more that government is centralized and the less it is limited, the greater the connection between the banks and the government--so the more that regulations become favorable for the central banks.
And decentralization can lead to localized corruption as well. See it all the time in communities.

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It was government regulation that led to the housing bubble, and government stimulus that created the following stock bubble that is now experiencing a correction which is not finished and may get worse and create a new financial "crisis."
Pretty much exactly the opposite. The bubble was mainly caused by a lack of regulatory control that allowed for cheap and reckless loans, further exacerbated by additional lack of regulation that encouraged corrupt banking practices to obfuscate the risk.
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Old 03-16-2018, 11:31 AM   #2
Jim in CT
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And decentralization can lead to localized corruption as well. See it all the time in communities.


Pretty much exactly the opposite. The bubble was mainly caused by a lack of regulatory control that allowed for cheap and reckless loans, further exacerbated by additional lack of regulation that encouraged corrupt banking practices to obfuscate the risk.
"The bubble was mainly caused by a lack of regulatory control that allowed for cheap and reckless loans,"

You are correct there. But I wonder what would have happened, if the Bush administration had put a stop to that. if the feds passed laws saying banks had to follow more traditional mortgage underwriting, then people would have said Bush was trying to keep poor people from buying houses. But I think you nailed the causes. The Clinton administration, with the GOP congress I think, removed the regulations which prevented traditional banks from getting too involved in these fishy investments.
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Old 03-16-2018, 11:59 AM   #3
detbuch
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"The bubble was mainly caused by a lack of regulatory control that allowed for cheap and reckless loans,"

The Clinton administration, with the GOP congress I think, removed the regulations which prevented traditional banks from getting too involved in these fishy investments.
The traditional banks were directed and encouraged by a regulation that substantially led to these fishy investments--The Community Reinvestment Act.

Last edited by detbuch; 03-16-2018 at 12:54 PM..
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