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The history of the mortgage industry, going back to the 90's.

Cute. It's the government's fault:
--for urging the mortgage industry to lend to people based on ability to repay instead of refusing to lend to non-whites or on property in a non-white neighborhood
--for not sufficiently regulating the industry.

Actually, I blame insufficient regulation. We should have left in place banking laws passed after the Wall Street Crash of 1929. If there's one thing we should know by now, it's that we can't really trust people whose business it is to make money, as much money as possible, any way possible. When it became legal for banks to sell mortgages, there was no longer any consequences of making bad loans. And there were no longer any consequences to packing loans, a lot of them, and selling the packages. And there were no longer any consequences to selling shares in these packages. Except for the buyers.

Mortgage lenders were pushing their employees to make as many loans as possible--which the lenders would then sell.

Take a look at the financial industry in the past decade or so. Every time the banking industry gets permission to do something new, it turns out to be great for them and really bad for everyone else. They are really creative at packaging and selling ... well ... money?

Years ago, I read about a country somewhere or the other that had no stock market. Or stocks. So, some clever or bored people made up a stock exchange and some stocks to trade. It was a bit like these internet games where you can buy property in the game, etc. They traded these invented stocks, which were holdings in nothing. And then, it got serious. They started trading furiously and the values started shooting up. Until someone got smart and started the sell-off. And the invented stock market crashed.

That's kind of the way I see our financial industry sometimes. When they make it possible for industries to expand or improve, that's great. When they come up with new ways to package money or commodities while making sure they bear no risk for the quality of their packages, that's terrible. And the rest of us pay the price.

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