Dan Gross on the Blame Fannie, Freddie and CRA First crowd

the hierarchy would simply need to be a triangle of greed, stupidity and short-sightedness. And it's green (as in reusable for just about any crisis).

"In the hierarchy of causes of our current debacle, I just don't think Fannie-Freddie and the CRA make it into the top 5. The CRA probably doesn't even make it into the top 10. And yes, I know, I should probably get to work compiling that hierarchy of causes."

There is a partisan political machine out there repeatedly blaming Fannie-Freddie and CRA for the whole mortgage crisis. You'll have to shout loudly and often to have your voice heard.

"These institutions worked hand in glove with Bear Stearns and Lehman Brothers . . ."

The glove doesn't seem to have offered much protection to any of the parties.

You know, it really isn't that complicated.

1. Poor people don't have enough power to break the system
2. We have a group of of so-called "conservatives" who --even before this crisis, had almost doubled the national debt in 8 years. Now, leaving aside the fact that nobody gets to borrow forever, it was certainly a bad influence. Our "so-called" leaders finance a war on IOUs! Whee! Borrow borrow borrow! It must be good, the government's doing it!

So what did they think the country was going to get? A good conduct medal?

I recommend you re-publish Warren Buffet's "Squanderville".

You know, it really isn't that complicated.

1. Poor people don't have enough power to break the system
2. We have a group of of so-called "conservatives" who --even before this crisis, had almost doubled the national debt in 8 years. Now, leaving aside the fact that nobody gets to borrow forever, it was certainly a bad influence. Our "so-called" leaders finance a war on IOUs! Whee! Borrow borrow borrow! It must be good, the government's doing it!

So what did they think the country was going to get? A good conduct medal?

I recommend you re-publish Warren Buffet's "Squanderville".

You know, it really isn't that complicated.

1. Poor people don't have enough power to break the system
2. We have a group of of so-called "conservatives" who --even before this crisis, had almost doubled the national debt in 8 years. Now, leaving aside the fact that nobody gets to borrow forever, it was certainly a bad influence. Our "so-called" leaders finance a war on IOUs! Whee! Borrow borrow borrow! It must be good, the government's doing it!

So what did they think the country was going to get? A good conduct medal?

I recommend you republish Warren Buffet's "Squanderville".

I would like to know what you think about the actions post 9/11 to restart the economy. Some of my reservations about our current course stem from my thinking that what we are experiencing is, in part, the back end of that original liquidity push. I'm starting to think it's that liquidity flood that really finished off the credit market. Now, that doesn't mean that the 9/11 response is the root cause, but I think it has greatly complicated our situation.

I see a lot of analogies to the economy and medical conditions. Warren Buffet said that the economy suffered a coronary. Others say that the economy has been infected with a cancer. I guess my analogy is that I think our economy has developed diabetes but I'm not sure if it's Type I diabetes (by this I mean something that developed due to an inherent predisposition) or Type II diabetes (something that developed due to long term bad habits). In this scenario, liquidity is insulin to which the economy seems to be becoming increasingly resistant. Further, I am unsure if we are in a diabetic coma, but I suspect at a minimum that we have allowed this disease to progress to such an extent that we have to figure out which parts to amputate in order to save any part of the larger whole.

Which analogy do you think best fits?

I just found this article over at Minyanville and I think this expresses and explains what many Americans feel.

http://www.minyanville.com/articles/AXP-sox-Fed-SLM-hgx-subprime/index/a/19378