The surprise villain behind nation's financial meltdown

  • Article by: KATHERINE KERSTEN , Star Tribune
  • Updated: October 8, 2008 - 8:49 AM
  • 90
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coop0188Oct. 7, 08 7:52 PM

Kersten article I agree with. I just wish she would point to some more academically reliable sources instead of far-right think tanks. I mean, it's the height of hypocrisy to have someone tell us that we're borrowing too much, coming from an organization that probably took some money from the very people that created the cracks and then swept us towards the cracks. Just sayin'.

E56089Oct. 7, 08 7:56 PM

Frugality may be on the way back. Wasn't there just an article about more "middle class" folk shopping at thrift stores?

ParisPeasantOct. 7, 08 8:10 PM

to see Kersten quote Daniel Boorstin, a valuable voice in the history of America. I'm car-free (and now, debt-free), and it's worth it in these uncertain times. (Plus I love reading on the bus.)

DierkesjOct. 7, 08 8:51 PM

What a simplistic analysis - - unfortunately, it is probably correct. At one time a person's net worth was what counted. Now it would seem that what is more important is how much credit you can get. Delayed gratification is just not in style anymore.

mn55066Oct. 7, 08 9:33 PM

If we purchased only the items we actually need, the world would collapse. We are sheep who have all worshiped at the altar of consumerism. And now, as they say, it's time to pay the piper. The government knew what was happening and did nothing about it (in fact, deregulation made it even easier for us go go further into debt). Why? Because too many CEOs who contribute to both political parties were making large amounts of money for themsselves and a very few people at the top. Plus, they never have given a crap about anyone else. These people should be lined up and shot.

trojan84Oct. 7, 08 9:59 PM

Please, quit trying to hang the mortgage situation on CRA. The Community Reinvestment Act has as much to do where we all are now as global warming or the Vikings record over the last decade. The law has never had any teeth. It had everything to do with lending locally, and nothing to do with giving out mortgages to people who had no business getting them. Want to point fingers? Look at all the unregulated mortgage brokers who were addicted like crack addicts to the origination fees and service premiums that each deal paid them. They are all off to new jobs (probably in the fast food industry) now, and we are left to clean up their mess.

nojusticeOct. 7, 0810:01 PM

President Clinton revised the Community Reinvestment Act in 1995 that demanded easy credit for people with flaky say otherwise would be racist!

stribspamsuxOct. 7, 0810:39 PM

After reading Nick Coleman's gripping, throughy stuctured analysis of the financial meltdown (written right before he ducked into the 3:15 Sunday Cohen Bros. preview), I couldn't in a million years imagine the strib employing another folksy, nobel-caliber macroeconomist. But here we have the most complex, analytical, and non-moralizing commentary to date of this crisis! SERIOUSLY Nick: Please stick to writing about the inane topics relevant only to aging hippies. Kristen: Please stick to writing about the inane nature of theses inane topics relevant only to aging hippies.

wigwagOct. 7, 0810:50 PM

As Kersten says: Take a look in the mirror for PART of the problem with the financial crisis. If you pay any of your bills late or make minimum payments on your credit card you are PARTLY to blame. If your debts exceed your income you are PARTLY to blame. QUIT TRYING TO POINT FINGERS EVERYWHERE ELSE AND TAKE SOME RESPONSIBILITY and PERSONAL ACCOUNTABILITY. If I have offended you chances are you're voting for Obama. God help us all.

elwher2Oct. 7, 0810:53 PM

I read an article that talked about a 2004 banking meeting (was it the SEC?). That meeting expanded the banks with more than $4 billion in assests to expand their debt to capitol ratio to 33:1. Personally i think i am totally overreached and im at about 1.2 or 1.3 to 1. Seems that the banks (and our government) are playing with Monopoly money and it has crashed for the second time in eight years. I read another posting that bled fear about adding more monopoly money to the mix (like approx $700 billion more). I am only forty, but i'm sure many people have watched their retirement float away in these two disasters.


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