Well, maybe. I grew up in NYC. My grandparents and parents were immigrants (legal). If they had issues they could go to their local Democrat and get help. It created generational loyalty.
Create a problem then offer the solution - the time worn strategy for Dems.
Most people don't know that Obama was at the origin of the 2008 meltdown. As a community organizer in the 90's in Chicago, he started a class action lawsuit against banks for not loaning to minorities. The Clinton admin strong-armed the banks to loan to unqualified applicants. This begat the mortgage derivates market which was meant to mitigate the risk of "subprime" loans, and instead networked the risk so every bank (and it was almost every bank in the US) became infected. This infection resulted in the inability of the market to value those assets, putting banks in violation of the capital requirements (since an asset that couldn't be valued was excluded from capital). This lead to a freeze on loans, since banks can only lend out what their capital can support.
So, unknowingly for sure, Obama created a problem and then became POTUS based on it.
Oh, by the way, 49% of the parties in the class action lawsuit who were "unfairly" denied loans defaulted. Gee, who could have predicted that?!?!
Obama was not the origin of the 2008 meltdown. Sure, he contributed to unqualified lending. But the center of our modern meltdowns is the central bank - i.e. Federal Reserve.
The pre-Fed era generally did not feature economy-wide meltdowns. When bank panics occurred in the 19th century (outside of the prior central banks, the first and second), you will find state-level fractional reserve banking and unjustified legal protections of that practice. But even with that, the greatest period of wealth creation in this country followed the Civil War and continued until the adoption of the Federal Reserve Act.
I don't know a lot, granted. But my understanding is that the *big* problems started happening in '95, when The Fed decided they were smart enough they could actually *control the economy.* That's how dumb they were. And if anything untoward popped up, they had all the tools to *fix* it all up. No problemo. AFAIK, they just didn't know when to *stop* fixing things.
The rest, as they say, is history. Actually, that's about all I know about it, FWIW.
I've done quite a bit of reading on this, and the economic structure that allowed the meltdown to occur is as you stated. But the trigger event is most definitely the agreement between banks and the Clinton administration in response to the Obama class action lawsuit.
Without that agreement, sub-prime loans never emerge, no risk mitigation is needed and mortgage derivatives are never developed, loan defaults don't occur, bank capital does not get hammered, and the credit market doesn't freeze.
Dems were never the party of the little guy. They used "the little guy" to enrich themselves and their cronies.
Well, maybe. I grew up in NYC. My grandparents and parents were immigrants (legal). If they had issues they could go to their local Democrat and get help. It created generational loyalty.
Mob bosses have always done that.
Create a problem then offer the solution - the time worn strategy for Dems.
Most people don't know that Obama was at the origin of the 2008 meltdown. As a community organizer in the 90's in Chicago, he started a class action lawsuit against banks for not loaning to minorities. The Clinton admin strong-armed the banks to loan to unqualified applicants. This begat the mortgage derivates market which was meant to mitigate the risk of "subprime" loans, and instead networked the risk so every bank (and it was almost every bank in the US) became infected. This infection resulted in the inability of the market to value those assets, putting banks in violation of the capital requirements (since an asset that couldn't be valued was excluded from capital). This lead to a freeze on loans, since banks can only lend out what their capital can support.
So, unknowingly for sure, Obama created a problem and then became POTUS based on it.
Oh, by the way, 49% of the parties in the class action lawsuit who were "unfairly" denied loans defaulted. Gee, who could have predicted that?!?!
“Create a problem then offer the solution”
Kind of like the protection racket.
Obama was not the origin of the 2008 meltdown. Sure, he contributed to unqualified lending. But the center of our modern meltdowns is the central bank - i.e. Federal Reserve.
The pre-Fed era generally did not feature economy-wide meltdowns. When bank panics occurred in the 19th century (outside of the prior central banks, the first and second), you will find state-level fractional reserve banking and unjustified legal protections of that practice. But even with that, the greatest period of wealth creation in this country followed the Civil War and continued until the adoption of the Federal Reserve Act.
See Mises.org to start your education.
I don't know a lot, granted. But my understanding is that the *big* problems started happening in '95, when The Fed decided they were smart enough they could actually *control the economy.* That's how dumb they were. And if anything untoward popped up, they had all the tools to *fix* it all up. No problemo. AFAIK, they just didn't know when to *stop* fixing things.
The rest, as they say, is history. Actually, that's about all I know about it, FWIW.
I've done quite a bit of reading on this, and the economic structure that allowed the meltdown to occur is as you stated. But the trigger event is most definitely the agreement between banks and the Clinton administration in response to the Obama class action lawsuit.
Without that agreement, sub-prime loans never emerge, no risk mitigation is needed and mortgage derivatives are never developed, loan defaults don't occur, bank capital does not get hammered, and the credit market doesn't freeze.
Tammany Hall was corrupt on a massive scale. But they weren't stupid.