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What Caused the Financial Meltdown?
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<blockquote data-quote="Give-Me-A-Break!" data-source="post: 406514"><p>Lets be clear. Rather than finger pointing, lets come to a serious reality check.</p><p></p><p>GREED is to blame in this regard. From Wall street to the consumer. They took an honest mandate by a president (home ownership) and took advantage of serious flaws in the system in order to make big bucks.</p><p></p><p>From the Realtor to the Fannie and Freddies, at every level, serious gouging and exploitation occured and many made tons of money.</p><p></p><p>The real problem is this, in the begining, affordable homes were to be built and decent loans were to be made. With respect to the builders, they got greedy, they started building homes too large and too expensive and the realtors and mortgage writers had to become more creative in order to sell the homes.</p><p></p><p>At some point, all serious qualifications went out the window and without safeguards, millions of bad loans were written by the mortgage brokers.</p><p></p><p>Those mortages were then sold and backed by the fannie and freddies under the assumption that the equity in the homes were the security.</p><p></p><p>But, no one took in consideration "saturation" and once the number of homes began to stop selling, the values began to drop, as they began to drop so did the homes values.</p><p></p><p>Now, fannie and freddie as well as many banks are holding homes that are not worth the paper they are written on.</p><p></p><p>The blame should go from the consumer to the White House.</p><p></p><p>This being said, we are all to blame.</p></blockquote><p></p>
[QUOTE="Give-Me-A-Break!, post: 406514"] Lets be clear. Rather than finger pointing, lets come to a serious reality check. GREED is to blame in this regard. From Wall street to the consumer. They took an honest mandate by a president (home ownership) and took advantage of serious flaws in the system in order to make big bucks. From the Realtor to the Fannie and Freddies, at every level, serious gouging and exploitation occured and many made tons of money. The real problem is this, in the begining, affordable homes were to be built and decent loans were to be made. With respect to the builders, they got greedy, they started building homes too large and too expensive and the realtors and mortgage writers had to become more creative in order to sell the homes. At some point, all serious qualifications went out the window and without safeguards, millions of bad loans were written by the mortgage brokers. Those mortages were then sold and backed by the fannie and freddies under the assumption that the equity in the homes were the security. But, no one took in consideration "saturation" and once the number of homes began to stop selling, the values began to drop, as they began to drop so did the homes values. Now, fannie and freddie as well as many banks are holding homes that are not worth the paper they are written on. The blame should go from the consumer to the White House. This being said, we are all to blame. [/QUOTE]
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