Friday, May 14, 2010


Here is a very simply stated informative video explaining how we got to this global financial crisis. I would like to add one VERY IMPORTANT point to this - at the critical time when the investors ran out of home buyers and wanted more, along came the deregulation of the mortgage industry (around 1999 under the Clinton administration) which gradually became more and more lenient and eventually did not require ANY documentation of the borrowers ability to repay their debt or even verify their income. They were counting on the home prices continuing to increase and if there were some defaults they could foreclose and sell for a profit. This is much more about the deregulation of the mortgage industry encouraged by FNMA and FreddieMac.

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