2/3rds of all bad US mortgages were secured by the federal govt.

[SciFiBoy]

Soleron said:

I agree with the facts but not the sentiment. Government-backed, subprime mortgages were made where they shouldn't have been, but did the right-wing Bush administration attempt to stop it happening? Or try and reduce the government's footprint on that market, as true financial right-wingers would have done on principle?

The private sector had every right to make those mortgages, but it should have been transparent to buyers how much risk was involved, and more importantly when it all went wrong those institutions should have been left to go bankrupt. How can a free market learn from its mistakes if the banks get rewarded by the government (via bailouts) for bad decisions?

Those calling for more regulation of banks' lending should consider that we may have been better off with less government intervention than there was. The only measure that would have helped were stronger rules on financial transparency and disclosure.

because the free market big bussiness finances the government so when something goes wrong, in order to stay in bussiness, they say to the government "hey, you want to have money for your election campaign right? okay then, bail us out first and we will pay you back by helping you win the election", not to mention that people have there money/savings in those banks, forcing the government to at least have to protect those people.

also, the example you gave is in the US only, in the UK there was no such program, so regulation wasnt a cause here, rather here, the big bussiness lent like that anyway thus lack of regulation against it was the problem both here and in the US, the problem wasnt with regulation, but with the type of regulation, had the government regulated AGAINST that type of lending it would have been different in all likelyhood, I doubt anyone is daft enough to say the government should regulate for that sort of lending.