A point of discussion for your next Happy Hour. :>)

If asked the proper question. There is not one mortgage or bank Exec. That will say that codes and regulations forced them to make a single loan. Because there were no codes or regulations that forced banks to make loans.

If bank exec. Are asked the proper questions. They will admit it was the liar loans that are the loans that have created the biggest foreclosure problem. Because it is the liar loan that was given to the person who had no verifiable income. There are no regulations that justified liar loans. Liar loans were invented by the bank exec. So they could get the upper hand on the competition. It was greed. The desire for unjustified profit that drove these liar loans. Nothing else.

It just so happens that liar loans were usually combined with the adjustable and other loans. It was the liar loan though, that made up the majority of sub prime loans.

Capitalism in America has always supposed to work as follows.

A company enters into a transaction at it's own risk. No regulation forces anyone to make a loan. In fact no regulation forces anyone to maintain a business. Someone offers a product. Someone makes a offer. And a contract is enforced.

Bank and mortgage exec. Continually made business decisions meant to undercut the competition. The product was never a consideration. Only the transaction mattered. Make the deal. Collect the fees for processing the transaction and resell the product. Wash your hands clean of the product. (mortgage).

We will never get out of this depression unless This financial mess is cleaned up. Beginning with the commodities market.

If not for the unjustified run up in commodities. We would not be in the depression we are in today. It eventually would have come about. But not as soon as it did. And not as bad a bubble burst. And the delay could have allowed time to formulate a plan to save the housing industry.

But $147 dollar crude forced the depression. It hog tied even the honest home buyer. It forced even the honest American to pull back on their spending. This killed business. And it was the businessmen who was most heavily invested in the liar loans. They no longer had to produce 2 years of tax returns to get a mortgage. They had been lying on their returns for decades. Now they just made up numbers that didn't even need to be verified by a return.

The ditch digger. The Laborer and the like didn't have the clout with the exec to get a liar loan. Unless of course they were recruited by an unscrupulous Real Estate agent to enter into fraudulent flipping schemes.

The commodities market must be changed. At this time they are allowed to buy and sell contracts. Never having the ability to accept delivery of a product. Only requirement is that they have the cash to make a 1/7 payment on say a 1000 barrel crude contract. In other words at $100/barrel. A person only needs about 13 grand to tie up 1000 barrels of crude. Even if he doesn't own a bucket.

THAT IS NOT SUPPLY AND DEMAND.
That is hoarding. It is monopolizing a product through paper transactions.

Adam Smith Capitalism demands regulations and regulators. Anyone who says different knows nothing of Capitalism. They may have a idea for a personal road to selfishness . But Not the wealth of nations. And the Wealth of Nations is the building block that Capitalism was established.

There are billions of barrels of crude parked in the ocean with no where to go. There is no demand for crude. The supply of crude is far superior to the near future demand requirements. Yet the speculator is allowed to hoard CONTRACTS forcing up the price of the Nations survival.

We hear there is a cut back in production. That production will eventually not keep up with demand so the price must go up. But that is a lie. Cutting back in production. Only increases reserve capacity.

It doesn't create a shortage.

OPEC knows this. It has been screaming it out so the world could hear. But the financial kings have been able to prevent change.

Commodities rules for all commodities must be changed so that a commodity has to be physically received. Before it can be resold.

And it must be received at a location that is near the purchasers place of business. Not a rented cargo ship or tanker. The commodity must be loaded on a mode of transportation. Transported to another location, off loaded and stored in a permanent facility before it can be resold.

If rules such as these are not enforced. The price of crude and commodities will destroy any recovery that may come from the current programs placed in effect this year. They will suck every bit of cash made available by the current programs, out of the wealth of Nations. Into their own greedy little fingers.

Adam Smith, the father of American Capitalism. Demands that the Villager must take care of the Farmer. And the Farmer must take care of the villager.

He says there must be a inheritance tax. Or a nation will revert to a nation of paupers and princes.

He demands that there be a redistribution of wealth. If not. One man will eventually own all the wealth. And that is not capitalism.

He insists on a progressive income tax. One that requires that a person pays tax in accordance to his benefit from society.

He insists on regulation and regulators. Explaining that outside the law. In the midst of criminality. Capitalism will always fail.

And just imagine if you presented Adam Smiths. “Wealth of Nations” to Rush Limbaugh.

He would surely denounce it as socialism.

If only because it does not support his own selfishness.

Read the 'Wealth of Nations'. Then explain to me the parts of the Republican platform that supports Capitalism. The wealth of Nations is on line at:

http://www.online-literatur...

No Nation operates under a pure form of Democracy.

And Capitalism is not a form of Government.

It is model for the 'Wealth of Nations".

Not the wealth of Gary.