Occupy Wall Street

Originally Posted by Ronin

sorry couldn´t resist....it's a common pet peeve I have with Americans.

Did you watch the video? I believe the guy is of the "nationalize industry" variety of socialism, not just a democratic party member. Just because we don't have socialist politicians doesn't mean we don't have a few socialist people, especially in a country of 300 million+ people.

CR

An interesting comment, with which I largely agree, about conservatism and the OWS movement:

I was interested, and glad, to see this sentence in Gregory Djerejian analysis of the Occupy movement: "They are acting to secure conservative aims of re-balancing a society that is becoming dangerously unmoored and increasingly bent asunder." Why? Because it reasonably identifies a truth about today's Conservative/Liberal political environment - that many on the Liberal side of the political equation are often quite philosophically conservative. And that today's "conservatives" are anything but.

As a long time resident of that liberal political hotbed Madison, Wisconsin, I've often said that it is in fact one of the more conservative places you'll find.

Why? Because even most of the more radical lefties living here (and there are far fewer than some would like others to believe) are living essentially conservative lives; they want a safe place to raise their kids, value their monogamous relationships (gay or straight), support law and order, have decent middle-class jobs, and want their world to be primarily stable and fairly predictable. They surround themselves with generally like-minded neighbors, talk to them over their fences (or across their hoes at the community gardens), and politely wait for their children in the pick up zone of their schools.

Do they vote Democrat or even Green? Sure. But at their core, they want what traditional philosophical conservatives seem to want: community, neighborliness, predictability. When hundreds of thousands of them marched daily around our Capitol last spring in response to the new "conservative" governor's radical policy changes, it was because they felt the changes were moving too fast and the rules weren't being respected. The foundations of their lives - built generally on following the rules, respecting their contracts and following what seemed to be reasonable and stable career paths - were being shaken too vigorously and unfairly. You don't have to agree with their take on the situation to agree that the core of their complaint was about as traditionally conservative as you can get.

The problem is the left in America has no voice.

You are forced to choose between a hollowed out Trotskyist like Chomsky or some underemployed fool who parrots Chomsky but can't even begin to comprehend the subject he's talking about.

The left in America is infatuated with the abstract, not the tangiable. Everything has to be some giant black & white struggle. So kudos for excersising your rights as citizens but [...] shave the beard, put on a suit and speak coherntly you hippie . Clamoring on with no clear agenda other than "hurr derr kill the bankers" is asinine.

Originally Posted by Strike For The South

Everything has to be some giant black & white struggle.

Look, I don't much sympathize with hippie drum circles, but they're reacting to a real problem. The financial sector is overpaid, overgrown and out of control. They privatize profits and socialize losses, as the bailout showed. It's almost a textbook-perfect example of a rigged game. The rest of us work hard and play by the rules; not so the securities folks.

Again, I hypothesize that the average investment banker or stock broker is more parasitic and destroys more wealth than a welfare mother. (Some numbers: Annual cost of all means-tested entitlements (Medicaid, food stamps, family support assistance (AFDC), supplemental security income (SSI), child nutrition programs, refundable portions of earned income tax credits (EITC and HITC) and child tax credit, welfare contingency fund, child care entitlement to States, temporary assistance to needy families, foster care and adoption assistance, State children's health insurance and veterans pensions) is around $354.3 billion; estimates for true cost of financial bailout vary, but $4.6 trillion seems to be a not-unrealistic number.)

Not to mention this absurd and counter-factual meme that the financial crisis was created in Washington rather than Wall Street. Read up.

Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication. One reason is that Fannie and Freddie were subject to tougher standards than many of the unregulated players in the private sector who weakened lending standards, most of whom have gone bankrupt or are now in deep trouble.

During those same explosive three years, private investment banks — not Fannie and Freddie — dominated the mortgage loans that were packaged and sold into the secondary mortgage market. In 2005 and 2006, the private sector securitized almost two thirds of all U.S. mortgages, supplanting Fannie and Freddie, according to a number of specialty publications that track this data.

Fueled by low interest rates and cheap credit, home prices between 2001 and 2007 galloped beyond anything ever seen, and that fueled demand for mortgage-backed securities, the technical term for mortgages that are sold to a company, usually an investment bank, which then pools and sells them into the secondary mortgage market.

About 70 percent of all U.S. mortgages are in this secondary mortgage market, according to the Federal Reserve.

Conservative critics also blame the subprime lending mess on the Community Reinvestment Act, a 31-year-old law aimed at freeing credit for underserved neighborhoods.

Congress created the CRA in 1977 to reverse years of redlining and other restrictive banking practices that locked the poor, and especially minorities, out of homeownership and the tax breaks and wealth creation it affords. The CRA requires federally regulated and insured financial institutions to show that they're lending and investing in their communities.

Conservative columnist Charles Krauthammer wrote recently that while the goal of the CRA was admirable, "it led to tremendous pressure on Fannie Mae and Freddie Mac — who in turn pressured banks and other lenders — to extend mortgages to people who were borrowing over their heads. That's called subprime lending. It lies at the root of our current calamity."

Fannie and Freddie, however, didn't pressure lenders to sell them more loans; they struggled to keep pace with their private sector competitors. In fact, their regulator, the Office of Federal Housing Enterprise Oversight, imposed new restrictions in 2006 that led to Fannie and Freddie losing even more market share in the booming subprime market.

What's more, only commercial banks and thrifts must follow CRA rules. The investment banks don't, nor did the now-bankrupt non-bank lenders such as New Century Financial Corp. and Ameriquest that underwrote most of the subprime loans.

These private non-bank lenders enjoyed a regulatory gap, allowing them to be regulated by 50 different state banking supervisors instead of the federal government. And mortgage brokers, who also weren't subject to federal regulation or the CRA, originated most of the subprime loans.

So you're saying that if securities industry counts on government bailouts? What do you do when your children steal cookies? Do you give them more or cut their hand off?

Well, neither, I hope, but it looks like you're saying the (federal) government is the problem but it's Wall Street's fault. Is Wall Street a branch of the government?

It also seems like you agree with me that too big to fail is an oxymoron. Time for a little AT&T action!

Originally Posted by Vladimir

So you're saying that if securities industry counts on government bailouts?

I don't see how that is arguable. See moral hazard.

Originally Posted by Vladimir

t looks like you're saying the (federal) government is the problem but it's Wall Street's fault. Is Wall Street a branch of the government?!

If a rhetorical question falls in the woods and nobody hears it, does it make a noise?

I do not believe "government is the problem," and did not make that argument. The really crazy sub-prime lending mostly happened in a three-year period and was the majority preserve of private banks and investment firms. They did this for the same reason a dog licks its privates; because they could. And after they cashed in and took their bonuses, they demanded that the public bail them out. If that doesn't make you angry you're not breathing.

Originally Posted by Lemur

I don't see how that is arguable. See moral hazard.

It's not, but you're blaming someone for subsidized bad behavior. Admit that the government is the problem and end the hypocrisy.

Are you overpaid? Who makes that determination?

Originally Posted by Lemur

Look I think finance is overpaid, but there is actually a very strong contributor to this increase.

Cities speed up as population increases in a non-linear manner, crime, patents, talk, walk all increase faster as the population increases.

Some in a non-linear manner for instance you get along the lines of double the amount of people and you get 15% more crime per capita.

So do pay rates... increase the number of people and so does the income... just compare country towns to small cities to large ones.

One of the confounding things is finance sectors attract the best/worst and concentrate them in one city generally per country (London, New York, Tokyo, Sydney). Essentially that group of workers has a population based on the country's total population not just the local city... and at a non-linear increase rate too.

So you need to compare this to the general population increase of the US and apply a non-linear pay increase.

Originally Posted by Lemur

Look, I don't much sympathize with hippie drum circles, but they're reacting to a real problem. The financial sector is overpaid, overgrown and out of control. They privatize profits and socialize losses, as the bailout showed. It's almost a textbook-perfect example of a rigged game. The rest of us work hard and play by the rules; not so the securities folks.

Again, I hypothesize that the average investment banker or stock broker is more parasitic and destroys more wealth than a welfare mother. (Some numbers: Annual cost of all means-tested entitlements (Medicaid, food stamps, family support assistance (AFDC), supplemental security income (SSI), child nutrition programs, refundable portions of earned income tax credits (EITC and HITC) and child tax credit, welfare contingency fund, child care entitlement to States, temporary assistance to needy families, foster care and adoption assistance, State children's health insurance and veterans pensions) is around $354.3 billion; estimates for true cost of financial bailout vary, but $4.6 trillion seems to be a not-unrealistic number.)

Not to mention this absurd and counter-factual meme that the financial crisis was created in Washington rather than Wall Street. Read up.

Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication. One reason is that Fannie and Freddie were subject to tougher standards than many of the unregulated players in the private sector who weakened lending standards, most of whom have gone bankrupt or are now in deep trouble.

During those same explosive three years, private investment banks — not Fannie and Freddie — dominated the mortgage loans that were packaged and sold into the secondary mortgage market. In 2005 and 2006, the private sector securitized almost two thirds of all U.S. mortgages, supplanting Fannie and Freddie, according to a number of specialty publications that track this data.

Fueled by low interest rates and cheap credit, home prices between 2001 and 2007 galloped beyond anything ever seen, and that fueled demand for mortgage-backed securities, the technical term for mortgages that are sold to a company, usually an investment bank, which then pools and sells them into the secondary mortgage market.

About 70 percent of all U.S. mortgages are in this secondary mortgage market, according to the Federal Reserve.

Conservative critics also blame the subprime lending mess on the Community Reinvestment Act, a 31-year-old law aimed at freeing credit for underserved neighborhoods.

Congress created the CRA in 1977 to reverse years of redlining and other restrictive banking practices that locked the poor, and especially minorities, out of homeownership and the tax breaks and wealth creation it affords. The CRA requires federally regulated and insured financial institutions to show that they're lending and investing in their communities.

Conservative columnist Charles Krauthammer wrote recently that while the goal of the CRA was admirable, "it led to tremendous pressure on Fannie Mae and Freddie Mac — who in turn pressured banks and other lenders — to extend mortgages to people who were borrowing over their heads. That's called subprime lending. It lies at the root of our current calamity."

Fannie and Freddie, however, didn't pressure lenders to sell them more loans; they struggled to keep pace with their private sector competitors. In fact, their regulator, the Office of Federal Housing Enterprise Oversight, imposed new restrictions in 2006 that led to Fannie and Freddie losing even more market share in the booming subprime market.

What's more, only commercial banks and thrifts must follow CRA rules. The investment banks don't, nor did the now-bankrupt non-bank lenders such as New Century Financial Corp. and Ameriquest that underwrote most of the subprime loans.

These private non-bank lenders enjoyed a regulatory gap, allowing them to be regulated by 50 different state banking supervisors instead of the federal government. And mortgage brokers, who also weren't subject to federal regulation or the CRA, originated most of the subprime loans.

that graph is literally the most worthless piece of drivel ive ever seen

also these people are protesting the evil 1% and how they have all the wealth. They just look like ignorant buffons.

also i live in the city and some of the kids at my school are there (shocker). The ultimate irony is their parents are likely part of that evil 1%

Well it's not *that* bad but teasing out a single occupation and comparing it to a group of occupations is an attempt at manipulation.

Another shock value graph.

Kanye showed up in all his bling, the credibility of the protestors has just skyrocketed. I expect Paris Hilton next.

Originally Posted by Centurion1

also these people are protesting the evil 1% and how they have all the wealth.

Doubtless some of them are exactly that stupid. However, I don't think their little movement would gain any traction at all if it were merely "eat the rich." See earlier in the thread, comments by me about "legitimate complaints" and a very well-written article reposted by Sasaki Kojiro. As unlikeable as the protesters may be, they're not reacting to a vacuum.

-edit-

A more broad-reaching series of charts can be found here.

Also, further smackdown of the idea that the Federales were the primary movers/causal agents of the mortgage meltdown can be found here and (in less detailed form) here.

The GSEs did generate large losses, but their bad investments in housing loans followed rather than led the crisis; most of those investments involved purchases or guarantees made well after the subprime and housing bubbles had been expanded by private loans and were almost about to burst.

Even then, the GSEs’ overall purchases and guarantees were much less risky than Wall Street’s: their default rates were one fourth to one fifth those of Wall Street and other private financial firms, a fact not made clear by the authors. A further review of other literature shows that Clinton’s goals to increase “affordable lending” had little to do with the risks the GSEs took. The FCIC, for example, argued that in several years these goals were largely met by the GSEs’ standard loans with traditional down payments. [...]

As noted, the GSEs bought very few subprimes in the 1990s. But it might especially surprise the inexpert reader to know that the GSEs did not own almost half of the “toxic mortgages” written by private companies, a remarkable exaggeration on the part of the authors. As usual, no source for the estimate is given, but it is likely based on the analysis of Pinto, who was a former Fannie official and is a colleague of Wallison’s at the American Enterprise Institute. To make the claim, Pinto radically redefined what qualified a mortgage to be subprime or an Alt-A, for which mortgage-holders were often not required to document their income, rejecting the conventional and widely accepted definitions. In his analysis, almost any mortgage held by Fannie and Freddie with modest above-average risk was categorized, to use Morgenson and Rosner’s term, as “toxic.”

If so, one would presume the delinquency rates suffered by the GSEs during the crisis would have been very high. But David Min, an analyst with the Center for American Progress, shows that the after-crisis delinquency rates on the large additional portion of GSE mortgages that Pinto claimed were high risk, and that was termed “toxic” by Morgenson and Rosner, was roughly 10 percent, far lower than the 25 to 30 percent default rate of true subprimes. In fact, the rate of delinquencies for all GSE securities in 2004 was 4.3 percent, compared to a delinquency rate in private industry of 15.1 percent of mortgages. In 2005, the GSE rate was 7.8 percent compared to 28.7 percent, and in 2006 and 2007, the rates reached 13.2 and 14.9 percent in the GSEs and 45.1 and 42.3 percent in the private market.

Just for humor: First you say it's not about "eat the rich" then you link to an article showing exactly that.

The start of the article isn't very promising. Being "unable to focus their complaints" reminds me of when Democrats talk about focusing, or effectively communicating their "message." As if they somehow worded their thoughts better people would agree with them. DC buzzwords.

Those are nice, and exhaustive graphs, but all their only purpose is to point fingers at corporations when the real problems consist of things like uncertainty and poor political leadership. "The new normal" isn't. This is more like "what's old is new again."

Does the article even take Europe's problems into account? Not Europe as a whole but the ongoing financial instability caused by certain countries.

So, to sum up: There are a lot of factors influencing our current problems. What you are seeing, and what people are reacting to, are the symptoms, which are easy to see and point a finger at. They're missing the point and that's why I don't respect them.

The CIA was giving away crack?

Originally Posted by Strike For The South

The CIA was giving away crack?

Not even the CIA is that stupid. They were selling it for $10 a vial.

Originally Posted by Crazed Rabbit

Just because we don't have socialist politicians doesn't mean we don't have a few socialist people, especially in a country of 300 million+ people.

Bernie Sanders is a Socialist Politician.

I am just being nit-picky, but I think he is simply a "scumbag". He just happens not to be the typical-"Hi, I am on Fox!" variety such as Glenn Beck.

Sorry, I know this is spammy, but I couldn't resist...