happythoughts 0 #1 October 21, 2008 The last one. The same one, but a while ago. Apparently, a bunch of banks were giving loans to real estate developers based on the inflated value of their real estate. Hmmm... The skinny story is that rich people got richer. Then, the govt (which doesn't have money of their own, only our money) bailed them out. All the taxpayers get to pay off $325B so that rich people don't suffer. The estimates were about $15K per adult taxpayer. The beauty of it? It wasn't just one party. Because it happened during Carters watch, there is an opportunity to assign another dunderhead move to his over-lengthy list, but everybody's congressman helped by voting for it. A build-up of bi-partisan crap for years. It took years to fix too. An interesting read. Wall Street bundling unsound real estate and selling it to banks. My favorite part? People went to jail over it. That was because S&Ls were local. Just small town bank presidents. The presidents of multi-nationals will make millions and never get a harsh word. Welcome to the past. SNL QuoteThe savings and loan crisis of the 1980s and 1990s (commonly referred to as the S&L crisis) was the failure of 2412 savings and loan associations (S&Ls) in the United States. The ultimate cost of the crisis is estimated to have totaled around $560.1 billion, about $324.6 billion of which was directly paid for by the U.S. government—that is, the U.S. taxpayer, either directly or through charges on their savings and loan accounts—which contributed to the large budget deficits of the early 1990s. The concomitant slowdown in the finance industry and the real estate market may have been a contributing cause of the 1990–1991 economic recession. Between 1982 and 1991, the number of new homes constructed per year dropped from 1.8 million to 1 million, the lowest rate since World War II. Quote Share this post Link to post Share on other sites
billvon 3,116 #2 October 21, 2008 >A build-up of bi-partisan crap for years. Yep. The Keating Five is now infamous because of McCain's involvement, but democrats often forget that the other four of the five were democrats. Quote Share this post Link to post Share on other sites
lawrocket 3 #3 October 21, 2008 The biggest problem was that Keating was conning average Joes with worthless notes, who lost everything. My wife is hotter than your wife. Quote Share this post Link to post Share on other sites
Andy9o8 2 #4 October 21, 2008 Quoteaverage Joes Whoa. Were they plumbers? Quote Share this post Link to post Share on other sites
headoverheels 334 #5 October 22, 2008 QuoteQuoteaverage Joes Whoa. Were they plumbers? Many were. Others were Senators. Quote Share this post Link to post Share on other sites
masterblaster72 0 #6 October 22, 2008 QuoteQuoteaverage Joes Whoa. Were they plumbers? Naw, I believe they're just a buncha average, nondescript Joe Six-Packs. Be humble, ask questions, listen, learn, follow the golden rule, talk when necessary, and know when to shut the fuck up. Quote Share this post Link to post Share on other sites
kallend 2,148 #7 October 22, 2008 QuoteThe last one. The same one, but a while ago. Apparently, a bunch of banks were giving loans to real estate developers based on the inflated value of their real estate. Hmmm... The skinny story is that rich people got richer. Then, the govt (which doesn't have money of their own, only our money) bailed them out. All the taxpayers get to pay off $325B so that rich people don't suffer. The estimates were about $15K per adult taxpayer. The beauty of it? It wasn't just one party. Because it happened during Carters watch, there is an opportunity to assign another dunderhead move to his over-lengthy list, but everybody's congressman helped by voting for it. A build-up of bi-partisan crap for years. It took years to fix too. An interesting read. Wall Street bundling unsound real estate and selling it to banks. My favorite part? People went to jail over it. That was because S&Ls were local. Just small town bank presidents. The presidents of multi-nationals will make millions and never get a harsh word. Welcome to the past. SNL QuoteThe savings and loan crisis of the 1980s and 1990s (commonly referred to as the S&L crisis) was the failure of 2412 savings and loan associations (S&Ls) in the United States. The ultimate cost of the crisis is estimated to have totaled around $560.1 billion, about $324.6 billion of which was directly paid for by the U.S. government—that is, the U.S. taxpayer, either directly or through charges on their savings and loan accounts—which contributed to the large budget deficits of the early 1990s. The concomitant slowdown in the finance industry and the real estate market may have been a contributing cause of the 1990–1991 economic recession. Between 1982 and 1991, the number of new homes constructed per year dropped from 1.8 million to 1 million, the lowest rate since World War II. Ummm - Carter's watch ended in 1980.... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
kelpdiver 2 #8 October 22, 2008 Quote>A build-up of bi-partisan crap for years. Yep. The Keating Five is now infamous because of McCain's involvement, but democrats often forget that the other four of the five were democrats. I think most forgot as Cranston quickly retired due to cancer, Glenn retired 9 years ago, and Riegle and DeConcini retired after the incident at the end of their terms 13 years ago. McCain, otoh, is still active in DC, so he would be the one associated with it now. Quote Share this post Link to post Share on other sites
happythoughts 0 #9 October 22, 2008 QuoteQuoteThe last one. The same one, but a while ago. Apparently, a bunch of banks were giving loans to real estate developers based on the inflated value of their real estate. Hmmm... The skinny story is that rich people got richer. Then, the govt (which doesn't have money of their own, only our money) bailed them out. All the taxpayers get to pay off $325B so that rich people don't suffer. The estimates were about $15K per adult taxpayer. The beauty of it? It wasn't just one party. Because it happened during Carters watch, there is an opportunity to assign another dunderhead move to his over-lengthy list, but everybody's congressman helped by voting for it. A build-up of bi-partisan crap for years. It took years to fix too. An interesting read. Wall Street bundling unsound real estate and selling it to banks. My favorite part? People went to jail over it. That was because S&Ls were local. Just small town bank presidents. The presidents of multi-nationals will make millions and never get a harsh word. Welcome to the past. SNL QuoteThe savings and loan crisis of the 1980s and 1990s (commonly referred to as the S&L crisis) was the failure of 2412 savings and loan associations (S&Ls) in the United States. The ultimate cost of the crisis is estimated to have totaled around $560.1 billion, about $324.6 billion of which was directly paid for by the U.S. government—that is, the U.S. taxpayer, either directly or through charges on their savings and loan accounts—which contributed to the large budget deficits of the early 1990s. The concomitant slowdown in the finance industry and the real estate market may have been a contributing cause of the 1990–1991 economic recession. Between 1982 and 1991, the number of new homes constructed per year dropped from 1.8 million to 1 million, the lowest rate since World War II. Ummm - Carter's watch ended in 1980. QuoteCarter left office in January 1981, a year in which 3,600 out of 3,800 S&Ls lost money. The problem didn't magically start in Feb of 1981. Quote Share this post Link to post Share on other sites
happythoughts 0 #10 October 22, 2008 Quote>A build-up of bi-partisan crap for years. Yep. The Keating Five is now infamous because of McCain's involvement, but democrats often forget that the other four of the five were democrats. It wasn't just those 5. There were two houses of Congressmen who voted on stuff for a while beforehand. Greed comes in both persuasions of party affiliation. Even at the state level, our former local state Senator bought out his partners in a county bank. Then, he loaned his real estate/ construction/ development corp money based on inflated values. It went belly-up. He took the loan cash and let the company get taken over by the failing bank. He used the cash to start a big temporary services company. He was 4 different shades of swindler. Many stories. The last thing that I heard about him was, "Nope, that wasn't it. You have to have a heart to die of a heart attack." Quote Share this post Link to post Share on other sites
kallend 2,148 #11 October 22, 2008 Quote Ummm - Carter's watch ended in 1980. QuoteCarter left office in January 1981, a year in which 3,600 out of 3,800 S&Ls lost money. The problem didn't magically start in Feb of 1981. No, but the bulk of the problems stemmed from the Reagan era. Timeline: www.erisk.com/Learning/CaseStudies/USSavingsLoanCrisis.asp November 1980: Following the March enactment of the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA), which allowed the Bank Board to ease the previous statutory 5% of net worth requirement to anywhere between 3% and 6%, FHLBB eases 'net worth' rules to only 4% of insured accounts. DIDMCA also raises the bar on federally insured deposits from $40,000 to $100,000 and allows some S&Ls to put money into property development and other risky activities. 1981: Changes in federal tax regulations under the Economic Recovery Tax Act of 1981 help spark the beginnings of the real-estate boom of the early to mid 1980s. September 1981: FHLBB introduces various rules and accounting changes to make the financial condition of S&Ls look better, including allowing the deferral of losses from the sale of impaired assets over a ten-year period, and the issuance of capital 'certificates' that artificially boost apparent capitalisation. January 1982: Net worth rules eased again to only 3% of insured accounts. July 1982: FHLBB allows S&Ls to amortise 'supervisory goodwill' over a period of up to 40 years, up from an original 10-year restriction. Garn-St Germain Depository Institutions Act of 1982 allows easing of capital rules, and greatly eases restrictions on the proportion of a property's value that S&Ls can loan to a property developer. Deposit interest rate ceilings (Regulation Q) phased out for S&Ls, enabling them to compete for wholesale funds by offering high rates of interest. Late 1982: FHLBB starts to count equity capital as part of an S&L's reserves January 1983: Restrictions lifted on state-chartered S&Ls in California with regard to investments in property and service companies, as state legislators compete with federal legislators to ease restrictions on S&Ls. 1983: Interest rates fall, temporarily making some - though not all - of the S&L industry solvent on an economic basis. But the opportunity for rational closure of institutions and reform of healthy institutions is missed. Late 1984 and after: Regulators begin to tighten up regulations to try to prevent weaker institutions making rash loans and investments following a number of attention-grabbing S&L collapses. 1984-89: S&Ls pay above-market rates to attract deposits, particularly in hot spots such as the Texas S&L industry. It's clear that the industry is in deep trouble but its regulators lack resources and political backing to close insolvent institutions quickly enough. 1986: FSLIC, itself clearly insolvent by year-end 1986, resolves 54 thrifts with total assets of around $16 billion. But far more thrifts are insolvent according to their book values, while many others hover on the brink of book insolvency. The economic reality is even worse, with perhaps half the industry now under the water. 1986-1992: During the later 1980s, the real-estate bubble bursts in regions around the US, partly prompted by the passing of the Tax Reform Act in 1986, which removes federal tax incentives to invest in commercial real estate. 1987: The passing of the Competitive Equality Banking Act, and the setting up of a Financing Corporation (FICO) to fund FSLIC resolution of failing thrifts by means of issuing bonds, channel some limited resources to the programme of S&L closure, but the emphasis remains on keeping wounded S&Ls afloat. 1988: Regulators resolve 185 thrifts with total assets of $96 billion, but it's not enough to stabilise the industry and many resolutions continue to be by means of regulator-agreed acquisition: sharing rather than ending the economic woe. February 1989: George Bush, newly elected in November 1988, announces a programme for rescuing the S&L industry using taxpayers' money. 1989: Congress passes the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), which as part of a programme of reform sets up the Resolution Trust Corporation to liquidate hundreds of insolvent institutions. 1989-1990: In terms of public expense, the S&L crisis is at its height. RTC resolves 318 thrifts with total assets of $135 billion in 1989 and 213 thrifts with total assets of $130 billion in 1990. 1990-92: RTC continues to resolve large numbers of thrifts, but the annual figure for 1992 falls to 59 institutions with $44 billion assets.... The only sure way to survive a canopy collision is not to have one. Quote Share this post Link to post Share on other sites
mnealtx 0 #12 October 22, 2008 And *STARTED* in Carter's, with DIDMCA - which is what happythoughts said.Mike I love you, Shannon and Jim. POPS 9708 , SCR 14706 Quote Share this post Link to post Share on other sites
I love you, Shannon and Jim.
POPS 9708 , SCR 14706
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