Friday, September 26, 2008

What Caused the Economic Crisis

I am not going to pretend that I fully understand all of the causes of the current financial crisis. Quite frankly, after listening to hour upon hour of pundits discuss the crisis and reading numerous articles, I am not sure anyone fully understands it. No doubt there were multiple contributing factors. A lot of supposedly smart people had to do some stupid things to allow this mess to develop.

The left is painting this crisis as a failure of free enterprise and blaming Wall Street greed and deregulation. No doubt greed and regulatory failures were contributing factors, but we should not overlook the governments responsibility in this mess by pressuring lenders to make "affordable" mortgages available to unqualified borrowers. The Community Reinvestment Act pressured lenders to make risky loans that should never have been made. Government has had a policy of assuming that a lower homeownership rate among minorities was a result of discriminatory lending practices rather than a result of economic reality.

An interesting fact brought out in this video is that the liberal Democrats were the largest receipt of Fannie Mae campaign contributions. Chris Dodd, followed by Barack Omaba were the largest recipients of these contributions. When it comes to assessing blame for the current crisis, Democrats do not have clean hands.

This video is the best thing I have seen on the current crisis. At ten minutes, this is a little long but it is well worth watching. This video is fast-paced. I would suggest you use the pause button to take a good look at some of the charts and graphics.

I discovered this video posted on Blue Collar Muse. This needs to be seen by everyone wanting an understanding of the current crisis. If you are a blogger or belong to chat groups, please repost it. No need to post a link back, just repost it.

Stumble Upon Toolbar
My Zimbio
Top Stories

1 comment:

  1. A great read- I highly recommend this site. Even when I don't agree, I see his points. He writes clearly and concisely rather than verbosely, like some of the political sites.