Knows about your explanation is just plain incorrect the reason for the calls has been thoroughly explained and proven by major media publications, economists, Senate and Congressional investigations, etc. etc. no offense but it’s been thoroughly proven that loans were made designed to fail or at the least made out side of lending requirements , rating agencies and Wall street investment banks collaborated on bumping up the volume of loan and loan ratings to create securities. It makes no sense to beat a dead horse that a handful of greedy unregulated bankers made to many loans and now they need to recapitalize.
Even if in this case there is not fraud to cover up the loans are being called to cover up other fraud and have the taxpayers foot the bill. The explanation of calling loans to increase capital requirements makes no senses at why on earth would the government pay off bad debts criminal or not instead of just plain injecting liquidity into the system though the fractional reserve system. That 7 trillion that has been transferred to cover debts that aren't even valid could have been used to inject about 100 trillion dollars in liquidity into the system and people could have kept there homes and businesses instead of foreclosures and shutting down businesses which are contributing to the self feeding cycle. What's happening now is a repeat of what happened during the great depression though this current crisis is on a much bigger scale both in terms of volume and as percentage of debt ratio to GDP. Wall Street insiders called margin loans causing a collapse which spread to banks to cover the margins and the Fed contracted the credit. Sure some of the details are different but the principle is the same the government and the Fed knows there actions will cause increased foreclosures and business losses and a contraction in the credit. IN a fractional reserve system the loans are the capital, debt is money so calling loans and foreclosing creates a self feeding contraction in both the monetary system and of course causes the public to lose jobs, housing and capital to inject into the system. As far a blaming the Democrats I'm a lifelong Republican and have always and still do maintain that funding social programs contributes to the deficit which causes tax money to be spent on interest payments to the banks rather for government expenditures as most people imagine when they merrily send off their check to the IRS to pay for military, roads, schools etc. Social security gets used as a slush fund to write IOU's against to make the budget short falls appear less that they really are, and of course give the FED/IRS system more capital to work with, and less for us to keep for ourselves. As far a purely blaming the Democrats that couldn't be further from the truth it was Bush that oversaw the largest expansion of government authority and spending in the history of the U.S. I filled Rico (Mafia) charges in Federal court in order to derail the financial crises before it happened by getting Ameriquest the largest sub-prime lender in the country shut down before they and other subprime lenders looted the economy by securitizing loans designed to fail and collecting on the credit default swaps by intentionally manufacturing defaults and foreclosing as many loans as possible. George Bush received millions in donations laundered though 53 shell corporations all from the sole source and sole owner of Ameriquest Roland Arnall and in return made Roland Arnall the ambassador of the Netherlands in order to evade, investigation, prosecution, and restitution to the victims.
So the biggest single immediate factor in the current collapse was Bush letting Roland Arnall off the hook as the nation’s largest contributor to the toxic and illegal loans that buried our economy in exchange for illegal political donations to his campaign consisting of money that was stolen in the first place. Had Bush not sheltered Ameriquest the largest originator of fraudulent and high risk loans that may have set a precedent to go after the other crooks before the economy collapsed instead of arguing about solution after a totally avoidable crisis? How that is not a fascist/socialist for the executive branch to give immunity to crooks looting billions from the U.S. citizens forcing taxpayers on the hook for the damages and lost revenue?
It was Bush who pushed an increase in homeownership to the point where half the loans in the whole country were government sponsored lenders, his response to the bad loans sponsored by Fannie and Freddie was to just plain take over the GSE's how is that not a socialist policy to have the government sponsor half the loans in the whole country? How is not a socialist/fascist policy to allow Paulson an investment banker from Goldman Sacks dictatorial control over private assets? We can't fix the country and get it on the right track by lying, historical revision. Sticking our heads in the sand or placing the blame on others. To call the Democrats socialist I believe is correct since they advocate the progressive tax rate and a large social services program but the fact is the Neo-cons under Bush expanded socialism far more that any other Democrats could has possible gotten away with while people were distracted by the war on terror which has absolutely nothing to do with the massive expansion of government sponsored lending and the cover up of lending fraud leading to the current economic meltdown.
I’m a lifelong Republican, Ron Paul precinct leader and was selected as a Republican Federal election Judge I know first hand Bush, McCain and the neo-cons had the majority of people with traditional conservative and Christian political platforms labeled as extremists, domestic terrorists, terrorist supporters and all sorts of lunacy. But guess what it didn’t stop there was actually harassment, false arrests, intimidation, and outright vote rigging to stop a massive influx of millions to the Republican party to support traditional Republican values. The Neo-cons Bush and McCain decided the sole focus of the country would be perpetual war with radical Islam and to hell with the rule of law, property rights, the economy, jobs, homes, bank fraud, foreign interests buying banking and political influence, Illegal immigration bankrupting schools and hospitals causing crime waves and filling up our prisons and providing and avenue for Islamic extremists illegally entering our country through the unsecured borders.