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atyh 2y ago

TIL that my understanding of the role of the repeal of Glass Stegal in the 2008 crash was completely wrong.

What really led to the crash was legislation pushed by Barney Frank which forced lenders to lower their lending standards and to underwrite risky mortgages. These default prone mortgages forced through legislation are what failed first starting the cascading collapse of mortgage backed securities.

The Glass Stegal narrative was pushed to obscure government housing policy’s role in the 2008 collapse.

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Sasha 2y ago

I’m not sure what’s better, government affordable housing or bank-financed affordable housing.

Government PJs are the absolute shit, they’re so disgusting.

But bank-financed affordable housing is fake affordable housing. And apparently gets mixed up with the debt markets and causes potential unforeseen risks.

Still thinking about the best solution…

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atyh 2y ago

Yeah. Thinking through my post, the financial institutions chose to include those risky mortgages in their products. So blaming it entirely on government is wrong. But in general, im embarrassed that i missed something so obvious, and completely overlooked the role of government regulation in the collapse.

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Sasha 2y ago

How do we solve the affordable housing crisis without causing a financial one tho?

Land Races are something interesting to look into

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unity 2y ago

They’ve never stopped trying to force lenders to loan to risky borrowers going back to at least Clinton and it continues to this day.

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a source familiar with the matter 2y ago

https://portalconservador.com/livros/Thomas-Woods-Meltdown.pdf

And yep, Frank deserves a big pie in the face over 2008 housing crash https://youtu.be/iW5qKYfqALE?si=5Z-LQRogOg99-kO_

For some reason I can't find the famous clip where Frank says he's willing to "roll the dice" on the housing market, but the above "push for home ownership" in 2005 is pretty clear