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krw[_3_]

In article ,
says...
daestrom wrote:

Any of this sound familiar? Just replace 'broker' with 'mortgage
broker' and 'stock' with 'real-estate'.

After the crash, stricter regulations were put in place about buying
on margin and most people got smarter about buying on margin. Probably a
similar thing will happen now with mortgages.

Won't happen.

If stricter rules were employed in the mortgage market, those traditionally
deprived, downtrodden, and discriminated against couldn't afford a home
beyond their means. Further, segregated and gated communities would remain
off-limits to other classes of citizens.

That is not the problem at all. The real problem is "toxic CDOs"
and the margins the people who rolled these instruments used. Add
in any *slight* downturn and you have a instant busted bank. Like
the crash above, the margins on these real estate budles is quite
low (as low as 3%, AIUI). A *minute* downturn and it's in negative
territory. When you start getting defaults...

The minions that determine the final regulations are committed to equality
of outcome.

True, but not really this issue.

Whatever laws the legislative branch writes or whatever rules are
implemented by political appointees, the silliness will prevail.

That is definitely true. There is no end to silly season anymore.

--
Keith