Democrats, liberals, socialists, progressives continually claim that the Bush administration caused the financial meltdown.
Of course nothing could be farther from the truth.
Decades of government interference in the mortgage free market caused the financial meltdown.
Traditionally an individual voluntarily walked into a bank to ask for a mortgage. The bank examined the individual's credit history, income, etc. and the voluntarily decided to give that individual a loan/mortgage.
In 1977 Jimmy Carter signed the Community Reinvestment Act (CRA) passed by a Democratic Congress.
The bill set up quotas for subprime mortgages in targeted neighborhoods and made community organizers the watchdogs of the banks.
A bank appeared before regulatory agency like the FDID and local comminity organizers had a right to testify about the bank's fulfillment of its duty to serve the needs of the community in which it operates. This enabled the community organizers to force banks to write more and more subprime loans in their neighborhoods regardless of the strengths or weaknesses of the individual applicant.
None of the loans written in accordance with the 1977 Community Reinvestment Act was a free-market loan because the issuing banks did not act voluntarily, but instead were given quotas by community organizers.
Congress created two agencies to act as 3rd party purchasers of sub-prime loans, Fannie Mae in 1938 and Freddie Mac in the 1970's.
Both federally created agencies were run by private boards and CEO's.
These agencies received mandates from Congress to fund the subprime mortgage market.
Congress ordered Fannie Mae and Freddie Mac to purchase subprime loans from banks, savings and loans, and mortgage brokers.
None of Fannie Mae and Freddie Mac's purchases were free market transactions.
Both institutions received orders to purchase subprime mortgages from private lenders. None of these purchases were voluntary.
Country Wide lending began writing and selling as many loans as they could to Fannie Mae and Freddie Mac because they made closing costs off each loan they wrote and sold they risk they created in those poorly underwritten loans to Fannie Mae and Freddie Mac.
None of these transactions were voluntary free market transactions.

The massive amount of mortgages generated by the Community Reinvestment Act and Congressional mandates to Fannie Mae and Freddie Mac created a massive pool of subprime mortgages that began to be packaged as Mortgage Backed Securities and sold on mass.
Without Freddie Mac and Fannie Mae to create the huge pool of subprime loans Mortgage Backed Securities would not have existed.
MBS purchasers wanted insurance against risk and created Credit Default Swaps that spread the risk of MBS throughout the world's financial system.
Credit Default Swaps would not have existed if the massive amounts of subprime mortgages demanded by the Community Reinevestment Act and the mandates of Congress to Fannie Mae and Freddie Mac to private lending institutions to write subprime mortgages in massive quantities.
Was there fraud in private industry. Absolutely!
Did the fraud exist in free market loans? No. Free Market loans were properly underwritten.
Did the fraud exist in subprime loans mandated by legislation? Yes. The mandated loans were written because of quotas and mandates and traditional, ethical underwriting standards were ignored in order to meet quotas and mandates.

I won't bill you for this education. Educating my fellow citizens and the ignorant is its own reward.

^^
The tortured ravings of someone who's mother makes him wear boxing gloves in bed. Sad.

People blame the free market fro SUV's but of course they couldn't be more wrong. As the government destroyed the free market in car manufacturing in the 1970's by requiring higher and higher fuel efficiency standards families began to protest. The station wagon was effectively eliminated. Families either had to buy a small car that was useless to them or they had to pay huge amounts for a luxury car that was big enough for them. So Chrysler invented the mini-van which filled a niche, but wasn't cool. American Motors got a waiver from an EPA feeling threatened by a voter revolt, and got its newly designed Jeep Wagoner designated as a "light truck" free from the usual mileage restrictions.
Government manipulation of the free market gave families stark choices, small useless compacts/minivans/or "light trucks" like the Cadillac Escalade. What a light truck the Escalade is!
Another way that socialism, enforcing a cookie cutter gas standard on everyone, led to huge unforseen consequences that undoubtedly made the situation much worse than free market solutions would have.

TC! Join my live game! Enjoy to live game! gameID=85550 PM for password!

Only read the first four lines you posted in the original posting.
Completely ignored the walls of text that you dumped in your other posts, TL;DR.

"You buying a beer after work is a free market transaction."

So, should the government mandating a minimum age for the buyer be considered an affront to the free market?

What are your opinions on antitrust laws and the historical case of Standard Oil?

Of course minimum wages are not free market.
If you are for minimum wages fine.
Just realize that you do not embrace free market economics if you support minimum wages.
So don't blame the free market for unemployment when you disrupt the labor markets with minimum wages.
I don't know what you understand about Standard Oil yebellz, but Standard Oil was as far from free market as you can get.
Standard Oil eliminated forces suppliers to sell petroleum products at a given price.
Free market transactions are free of price manipulations by third parties. The only parties that decide on the price are the party selling and the party buying.
My whole point is that people who use the term free market don't even know what they are talking about. They have no more of an idea of what a free market is than they have an idea of how to open a business that will employ people, sell a product, and make money.

So when you buy a beer on the way home from work you are engaging in a free market activity.
No one is forcing you to buy the beer.
No one if forcing the brewer to sell you beer.
Now if you buy it at a bar the hours you can buy the beer are not free market hours.
I can live with that.
The price of the beer is definitely interfered with by taxes, license fees, inspection fees etc.
As long as they don't prevent you from making beer in your house and selling it to the public fine.
When laws and regulation prevent you from buying my homemade beer from me the free market in beer is restricted.
You should be free to buy a beer from anyone you want, and I should be free to sell a beer to anyone that wants to buy one.

That's a free market.

It's revealing how individuals who can't succeed in a free market lament it.

"Money Talks: Foreclosure Feast – How the Rich Get Richer" is the title of an article published today that laments the fact that the rich are snapping up good properties at depressed prices.

The article of course would be accurate if its headline was "Responsible individuals profit from the irresponsible actions of other individuals."

How do you even get a house foreclosed on? An irresponsible individual bought to much house, didn't make a big enough down payment, etc. etc. etc.
Losing your home is your fault and no one elses, unless of course you can prove fraud or some other legally enforceable reason for the loss of the home.

The fact that a responsible individual lived not only within their means, but well below their means in order to save money when an opportunity came along is absolutely despised by irresponsible individuals.

The O-dumba administration is not arguing that it would be best for all "taxpayers" if Fannie Mae and Freddie Mac wrote off hundreds of billions of principle in underwater mortgages.

How absurd to say that rewarding irresponsible behavior rewards all taxpayers. How absurd to say that propping up housing prices at artificially high levels rewards all taxpayers.

What rewards all taxpayers is to see irresponsible actions unrewarded. What rewards all taxpayers is to see housing prices find their equilibrium in a free market free of government interference. What rewards all taxpayers is to see Fannie Mae, Freddie Mac, and the FHA disbanded because their interference in the housing market causes bubbles, disrupts the traditional underwriting process, allows housing to be treated as an investment instead of what it is "housing/shelter," and pumps liquidity into the housing market that fuels rampant speculation.

Socialism vs Free Markets.
Socialism (East Berlin) Vs Free Markets (West Berlin)
East Berlin had to build a wall to keep people from fleeing for the West.
Socialism (Ghana) vs Free Markets (Ivory Coast)
Both became independent in the 1960's, but today the poorest quintile in Ivory Coast has an income above 60% of those in Ghana.
Socialism(Soviet Union) vs Free Markets (United States)
The Soviet Union no longer exists while the United States has the largest and most vibrant economy on the planet.

T-C
I hope this helps you as I think you may be a little confused about what was happening in the Soviet Union et al (definition below)
STATE CAPITALISM, NOT SOCIALISM
The term state capitalism has various meanings, but is usually described as commercial (profit-seeking) economic activity undertaken by the state with management of the productive forces in a capitalist manner, even if the state is nominally socialist.[1] State capitalism is usually characterized by the dominance or existence of a significant number of state-owned business enterprises. Examples of state capitalism include Corporatized government agencies (agencies organized along corporate and business management practices) and states that own controlling shares of publicly-listed corporations, effectively acting as a large capitalist and shareholder itself.

State capitalism has also come to refer to an economic system where the means of production are owned privately but the state has considerable control over the allocation of credit and investment, as in the case of France during the period of dirigisme. Alternatively, state capitalism may be used (sometimes interchangeably with state monopoly capitalism) to describe a system where the state intervenes in the economy to protect and advance the interests of large-scale businesses. This practice is often claimed to be in contrast with the ideals of both socialism and laissez-faire capitalism
regards
Nigee

Nice article in Forbes about China's highway system.
The Chinese have built a highway system that is now more extensive that our own in the United States, and the Chinese did not use a gas tax to build it.
The Chinese funded their highway system in true free market fashion with tolls.
If you use it you pay if you don't use it you don't.
Can you imagine the hissy fit that Americans with a sense of entitlement would throw if all highways were toll roads!

Just fascinating that the Communist Chinese recognize the failings of socialism and make people pay to use roads while Americans have lost touch with their own free market roots and oppose toll roads. Makes you scared for the future of this country if the government's power to interfere in the marketplace isn't curbed.
Just think we would never have had the financial meltdown without gigantic government interference in the mortgage market with Fannie & Freddie & mandates for mortgages imposed on lending institutions by maniacs like Maxine Waters, Barney Frank, and Chris Dodd.

yebellz, as TC cannot mute you, please please please please point out that he misread your post as "minimum wage" instead of "minimum age," which makes a big difference and fundamentally speaks to his reading comprehension.

TC, if you don't have me muted, tell me, who exactly /is/ blaming the free market for socialism?

Man, what's with socialism? It's ruined everything!

Stupid free market.

@TC - thanks for the education, I hadn't previously heard of the Carter bill to which you refer. Your arguement is well founded and well presented. It does however, have glaring omission and that is that the financial crisis was/is global and didn't start or stop at the borders of the USA. I live in the UK and no such Carter bill has ever existed, banks and building societies continued to follow the capitalist principle of doing whatever they thought made them money. They were never forced to provide loans of 125% to people who couldn't pay it back, they choose to do it because they wanted to make money. I'm not against making money, I'm all for it. But I think that if the USA and the UK both have a crisis when the USA had the Carter bill, and the UK didn't then there must be something else at play to cause the crisis and looking for one piece of legislation to blame is a little too simplistic.

Socialism hasn't ruined everything. It has ruined sovereign debt in Europe. That isn't nothing, but it sure isn't everything.

If the free market is stupid then socialism is brain dead.

Causes of the financial meltdown.
1-Community Reinvestment Act destroys underwriting standards and establishes government quotas for subprime loans.
2-The expansion of Fannie Mae and Freddie Mac to provide liquidity to fund sub-prime loans.
3-President Clinton and the Republican Congress exempt profits of home sales from capital gains taxation which starts rampant speculation in the housing market.
4-The creation of mortgage backed securities by financial institutions who then sale these packaged mortgages to institutional investors around the world.
5-The application of completely unregulated credit default swaps to mortgage backed securities.

The result, trillions of dollars of mortgages are packaged and sold throughout the world based on a speculative bubble in the American housing market backed by trillions in credit default swap securities that are entirely unregulated by legislation and thus have no financial backing at all for trillions of dollars of liability.

No Community reinvestment act- no flood of subprime mortgages or destruction of traditional underwriting standards.
No Fannie Mae or Freddie Mac- no flood of money to fund subprime mortgages.
No capital gains exemption of profits from home sales- no wave of speculation that creates an enormous bubble in housing prices.
No flood of subprime mortgages-no mortgage backed securities that spreads the speculative bubble around the globe accompanying speculative bubbles in Europe caused by the same type of government interference in the housing free-market.
No mortgage backed securities-no credit default swaps on mortgage backed securities.
No Credit default swaps- no finanical meltdown. Lehman Brothers, Bear Stearns, and AIG all failed because they did not have enough money to fund their credit default swap liabilities.

No flood of subprime mortgages-no mortgage backed securities.

Cable bills will begin to climb soon.
The reasons why are obvious.
Cable companies enjoy a monopoly in a huge segment of markets where fiber optics and satellite competition cannot or do not reach.
Cable companies receive their monopoly because of local government grant them monopolies.
The internet allows people to access media that circumvents these monopolies.
As a minority of people drop cable the cable companies raise their rates to replace the lost revenue.
Enjoy the socialist rate increase coming to a cable bill new your soon.

@TC - could you answer 1 question. Should government regulate the financial industry or not?

>Socialism hasn't ruined everything. It has ruined sovereign debt in Europe. That isn't nothing, but it sure isn't everything.

If the free market is stupid then socialism is brain dead.

>Socialism hasn't ruined everything. It has ruined sovereign debt in Europe. That isn't nothing, but it sure isn't everything.

>Socialism hasn't ruined everything.

...

Hold the presses, did that just happen?

TC is the next best thing we have to a sticky that links to a live Fox News feed.

TC forgot a few things....The repeal of the Glass-Steagall act in 1998 that removed the barriers between commercial and investment banks. The relaxation of capital requirements for banks which occurred 2006 I think. The Growth of the Derivatives market which was practically non-existent before 2000 to 100's of trillions of value by the time of the crash.....and still is. In fact if you look at the actual value of the total sub prime mortgages in 2008 it is dwarfed by the value of the total credit default swaps by a magnitude of 20 to 1 and by the derivatives market by a stunning 100 to one+.

"As a minority of people drop cable the cable companies raise their rates to replace the lost revenue. Enjoy the socialist rate increase coming to a cable bill new your soon."

Wait, what? Isn't that an example of a company changing rates based on demand...you know. The way capitalism is supposed to work.

Now you're blaming socialism for capitalism. That's new