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Originally Posted by Travis Henry
you already stated in a subsequent post that you don't want any more government regulation.
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Of course. The confusion seems be whether I said I wanted no regulation at all. Clearly, I did not say that.
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Originally Posted by Travis Henry
Citing to the Great Depression is perfectly relevant to the discussion because a lot of the things happening right now are strikingly similar to what happened during the onset of the Depression.
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This gets said in every economic downturn (which we're not even experiencing at the moment). If it's not the Depression, then it's 1987.
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Originally Posted by Travis Henry
Sarbanes-Oxley is one thing, and I'm curious as to whether you know anything about Sarbanes-Oxley or are you just repeating the party line?
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I'm a software developer not an accountant, so I can't cite you chapter and verse. But my father, my home teacher, and one of my best friends are all accomplished CPAs. None of them speak highly of the additional mess for their jobs SOX created.
In addition, some of the new procedures our IT group had to follow to be "compliant" were ridiculously intrusive, but my work (personally) was only marginally affected.
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Originally Posted by Travis Henry
If you track the increase in prices in California you'll find that they strongly correlate to the increased use of Options ARMs and interest only loans. People look more at the monthly payment on a house as opposed to the overall price. Additionally, the low initial teaser payments allowed house flippers to buy multiple properties to the point that up to 40% of the demand in many markets (e.g. Phoenix, Vegas, the inland empire) was due to house flippers. Eliminate the illusory demand and you get rid of a significant factor that led to the housing bubble.
I would venture to say that without these suicide loans, we don't have the current crisis. Housing prices don't escalate to the point where they were bound to significantly fall and the values on the underlying collateral on the MBS don't diminish. All of sudden Lehman Brothers and AIG don't have huge liquidity problems and the Fed doesn't have to bail out Fannie Mae. And it all could have been averted if the use of Option ARMs and interest only loans were sharply curtailed.
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Not sure I disagree with any of this.