why? why? why did I start looking into this? The more I look the worse it gets. I am still trying to prove its Barney Frank's fault but I keep rolling snake eyes. Now I come across this article explaining how the five investment banks got their capital restrictions lowered in 2004.
How U.S. regulators laid the groundwork for disaster - International Herald Tribune
"After 55 minutes of discussion, which can now be heard on the Web sites of the agency and The Times, the then-chairman, William Donaldson, a veteran Wall Street executive, called for a vote. It was unanimous. The decision, changing what was known as the net capital rule, was completed and published in The Federal Register a few months later.
With that, the five big independent investment firms were unleashed....
Over the following months and years, each of the firms would take advantage of the looser rules. At Bear Stearns, the leverage ratio — a measurement of how much the firm was borrowing compared to its total assets — rose sharply, to 33 to 1. In other words, for every dollar in equity, it had $33 of debt. The ratios at the other firms also rose significantly"
Lax oversight, deregulation and fighting regulation seems to be the cause of the credit crunch and economic crisis. If only somebody would post a picture of Obama in a turbin or a link to a video about Obama with ominous sounding music then I could forget all about the facts and go back to blaming the democrats.