Home › Forums › Financial Markets/Economics › The View From Inside a Depression
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briansd1.
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October 19, 2009 at 6:09 PM #471965October 19, 2009 at 6:24 PM #471131
briansd1
Guestucodegen, “infection” was certainly what caused the crisis.
As values of certain securities fell, the values of other securities followed and banks stopped making loans because they couldn’t sell their new securities.
The bailout schemes were supposed to help restore the “intrinsic” values of the securities.
It would like a neighbor’s house going into foreclosure, and another neighbor selling his house because of unemployment. Pretty soon, you can’t refinance your house because you no longer have equity. Then you can’t send your daughter to college or buy a new car, etc…
Without the “infection” effect, the crisis would have been contained.
October 19, 2009 at 6:24 PM #471311Guestucodegen, “infection” was certainly what caused the crisis.
As values of certain securities fell, the values of other securities followed and banks stopped making loans because they couldn’t sell their new securities.
The bailout schemes were supposed to help restore the “intrinsic” values of the securities.
It would like a neighbor’s house going into foreclosure, and another neighbor selling his house because of unemployment. Pretty soon, you can’t refinance your house because you no longer have equity. Then you can’t send your daughter to college or buy a new car, etc…
Without the “infection” effect, the crisis would have been contained.
October 19, 2009 at 6:24 PM #471671Guestucodegen, “infection” was certainly what caused the crisis.
As values of certain securities fell, the values of other securities followed and banks stopped making loans because they couldn’t sell their new securities.
The bailout schemes were supposed to help restore the “intrinsic” values of the securities.
It would like a neighbor’s house going into foreclosure, and another neighbor selling his house because of unemployment. Pretty soon, you can’t refinance your house because you no longer have equity. Then you can’t send your daughter to college or buy a new car, etc…
Without the “infection” effect, the crisis would have been contained.
October 19, 2009 at 6:24 PM #471748Guestucodegen, “infection” was certainly what caused the crisis.
As values of certain securities fell, the values of other securities followed and banks stopped making loans because they couldn’t sell their new securities.
The bailout schemes were supposed to help restore the “intrinsic” values of the securities.
It would like a neighbor’s house going into foreclosure, and another neighbor selling his house because of unemployment. Pretty soon, you can’t refinance your house because you no longer have equity. Then you can’t send your daughter to college or buy a new car, etc…
Without the “infection” effect, the crisis would have been contained.
October 19, 2009 at 6:24 PM #471970Guestucodegen, “infection” was certainly what caused the crisis.
As values of certain securities fell, the values of other securities followed and banks stopped making loans because they couldn’t sell their new securities.
The bailout schemes were supposed to help restore the “intrinsic” values of the securities.
It would like a neighbor’s house going into foreclosure, and another neighbor selling his house because of unemployment. Pretty soon, you can’t refinance your house because you no longer have equity. Then you can’t send your daughter to college or buy a new car, etc…
Without the “infection” effect, the crisis would have been contained.
October 19, 2009 at 6:27 PM #471136SD Realtor
ParticipantArraya we absolutely agree on that… yes I would agree that as of about 2003 Wall Street and even companies like AIG knew that for sure it was a no lose bet. Either you win and make money or you lose and get bailed out. I am sure it was known that a few lambs would be sacrificied but it was still a great bet.
October 19, 2009 at 6:27 PM #471317ParticipantArraya we absolutely agree on that… yes I would agree that as of about 2003 Wall Street and even companies like AIG knew that for sure it was a no lose bet. Either you win and make money or you lose and get bailed out. I am sure it was known that a few lambs would be sacrificied but it was still a great bet.
October 19, 2009 at 6:27 PM #471676ParticipantArraya we absolutely agree on that… yes I would agree that as of about 2003 Wall Street and even companies like AIG knew that for sure it was a no lose bet. Either you win and make money or you lose and get bailed out. I am sure it was known that a few lambs would be sacrificied but it was still a great bet.
October 19, 2009 at 6:27 PM #471753ParticipantArraya we absolutely agree on that… yes I would agree that as of about 2003 Wall Street and even companies like AIG knew that for sure it was a no lose bet. Either you win and make money or you lose and get bailed out. I am sure it was known that a few lambs would be sacrificied but it was still a great bet.
October 19, 2009 at 6:27 PM #471975ParticipantArraya we absolutely agree on that… yes I would agree that as of about 2003 Wall Street and even companies like AIG knew that for sure it was a no lose bet. Either you win and make money or you lose and get bailed out. I am sure it was known that a few lambs would be sacrificied but it was still a great bet.
October 19, 2009 at 6:59 PM #471151patientrenter
Participant[quote=briansd1]Without the “infection” effect, the crisis would have been contained.[/quote]
LoL!
Yes, you can let housing become overvalued by ten trillion dollars, and lend against the overvaluation by another few trillion, and the problem is the “infection” of letting the values come back down to earth.
October 19, 2009 at 6:59 PM #471332Participant[quote=briansd1]Without the “infection” effect, the crisis would have been contained.[/quote]
LoL!
Yes, you can let housing become overvalued by ten trillion dollars, and lend against the overvaluation by another few trillion, and the problem is the “infection” of letting the values come back down to earth.
October 19, 2009 at 6:59 PM #471691Participant[quote=briansd1]Without the “infection” effect, the crisis would have been contained.[/quote]
LoL!
Yes, you can let housing become overvalued by ten trillion dollars, and lend against the overvaluation by another few trillion, and the problem is the “infection” of letting the values come back down to earth.
October 19, 2009 at 6:59 PM #471768Participant[quote=briansd1]Without the “infection” effect, the crisis would have been contained.[/quote]
LoL!
Yes, you can let housing become overvalued by ten trillion dollars, and lend against the overvaluation by another few trillion, and the problem is the “infection” of letting the values come back down to earth.
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