U.S. Must Continue Propping Up Mortgage Market Says Bank Execs.

[SiriuslyLong]

And this little snippit

"The traditional mortgage model involved a bank originating a loan to the borrower/homeowner and retaining the credit (default) risk. With the advent of securitization, the traditional model has given way to the "originate to distribute" model, in which banks essentially sell the mortgages and distribute credit risk to investors through mortgage-backed securities. Securitization meant that those issuing mortgages were no longer required to hold them to maturity. By selling the mortgages to investors, the originating banks replenished their funds, enabling them to issue more loans and generating transaction fees. This created a moral hazard in which an increased focus on processing mortgage transactions was incentivized but ensuring their credit quality was not.[95][96}"

This has been my point Lloyd. The government was the incentivizer. Thanks for sending me down this path. You've made me even more convicted in my beliefs lol.

[Havakasha]

i quess you had to say it twice (LOL) because you couldnt handle the facts of the
non bank mortgage lenders large role in bad subpar loans or Mr. Poole's comments on the
start of the financial crisis.
I cant help you any more. i have given you some evidence that i believe contradicts your
strongly held belief, but you will obviously not be swayed.

P.S. No one every denied the govt's involvement.

[SiriuslyLong]

i quess you had to say it twice because you couldnt handle the facts of the
non bank mortgage lenders or Mr. Poole's comments LOL. Believe what you want.

No one every denied the govt's involvement.

I fat fingered it, and deleted the first one. You hit the nail on the head - government involvement. LOL FUBAR.

You reference to Mr. Poole enlightened me. Thank you. Indeed these sub prime loans from non bank were a cause, but for me, not the root cause.

[Havakasha]

Ok. Enjoyed the "conversation". Lets just agree to disagree. Have a good day.

Any thoughts on Bill Gross's suggested solutions let me know. i am not sure myself.

[SiriuslyLong]

Ok. Enjoyed the "conversation". Lets just agree to disagree. Have a good day.

Any thoughts on Bill Gross's suggested solutions let me know. i am not sure myself.

I don't like his suggestion; although I've looked at refinancing myself and have a call into the bank. The bottom line is that trillions of dollars were sucked out of the economy regardless of blame - somebody or something needs to write it off and take the loss, and you and I have already paid enough. All we are doing now is leaving our kids a pile of shit.

Face it, we are in new world. One where our government allowed jobs to be shipped overseas by American companies. This is one area of free trade that needed a closer look. Those are the jobs we need right now. People argue service economy...... In America, we need to make things.

I don't know what to do. Like I've tried in vane to point out, we have 77 years to sort out, and I'm only 46 years old myself.