12 Interesting Facts About the Housing Crisis

[Evan Bedard]

12 Interesting Facts About the Housing Crisis

That’s the implication of a new paper from economists at the Federal Reserve Banks of Atlanta and Boston that’s bound to spark debate because, if their premises are correct, it sharply undercuts the justification for much of the new regulation that’s been erected over the past two years.

Three economists, Christopher Foote, Kristopher Gerardi, and Paul Willen, present two narratives of the financial crisis in trying to answer why so many people made so many dumb decisions.

The first view is that the financial crisis was an “inside job” where various industry players, from the mortgage lenders to mortgage traders, took advantage of unsophisticated rubes, from homeowners to mortgage investors.

Source: WSJ

[Jeffrey L. Shurtliff]

Thanks for posting Evan! Sparks a thought from me about this to my recent discovery. In my fight with Wells Fargo and now Freddie Mac, I have found that Freddie Mac is a body, of the quasi monster that wheels its heads and these are the Banks. Without a head the body cannot do anything. In my research I have found this to be true. It shows that the Banks are calling the shots on the properties. It is also shows banks that created this mess and the body Freddie, went along with it as the bank is the agent head.

[Evan Bedard]

I couldn't agree with you more Jeffrey! It is the banks that are calling the shots and really have the decision when it comes down to it.. No matter if you have a loan mod, short sale, etc in process the bank is the one ultimately who is going to make the decision..

[troubleinriverside]

I am in the shadow inventory. i have a 7 yr fixed,10 year int only loan, with 3 years to go on the int only period. Interesting enough, due to the federal reserve keeping rates low, my rate has dropped 1% starting this month, so my int only payment drops $300 a month. But in 3 years I am going to need a mod. Not a day goes by that i dont worry about what to do in 3 years which can go by quickly. I hope Citi will help me when the time comes, god willing and the river dont rise.