1 of 3

No

Write now Article Tools

It would be easy, yet premature, to call the crisis in the financial sector of the economy the majority of the cause of another economic depression.

The economy isn't going full boar ahead, with the intensity of the 20 year bull market, so the media types are all about creating a faux-disaster - like with Fannie Mae and Freddie Mac. Greedily and haughtily, the media types seek a savior to help the nation through the financial crisis caused by Lehmans, AIG, and consequently the Fannie Mae and Freddie Mac.

While AIG and Lehman Brothers are legitimate traders, Fannie and Freddie were not. They were in a separate classification known as GSE, or government sponsored enterprise. Similarly another GSE of note is the United States Postal Service, which is having troubles of its own, though not quite as severe.

So why the bailouts of the financial sector? Well, it began with Bear Stearns. As the bad debt from the mortgage companies Fannie and Freddie piled up, most of the then-strong financial backing companies - Lehman, AIG, Bear Stearns - was absorbing the bad debt through acquisition. The problem with Fannie and Freddie though was entirely that they were not true companies in the sense of a profit-making enterprise.

Then in 1992, when Democrats had control of the houses of government, Fannie Mae, and to a lesser extent Freddie Mac, was encouraged by then HUD secretary Andrew Cuomo, to overlook traditional means of granting mortgage loans, such as, oh, credit worthiness, and ability to make payments on said prospective house, and instead look at what minority the applicant was, in granting them a housing loan. All this rubber-stamped by President Clinton, and backed by people like Barney Frank, Christopher Dodd, and Democrats prefering the fantasy "status quo".

At the center of the controversy are two former bosses at Fannie Mae - Franklin Raines, who is now an advisor on housing issues for Senator Barack Hussein Obama, and Jamie Gorelick, the Clintonian deputy Attorney General behind the stonewalling of federal agencies to share information on potential terrorist subjects which led to 9/11. Both worked at Fannie Mae, both received sizable bonuses for "cooking the books" to meet some arbitrary guidelines.

But really, those are side issues, and they don't, even in their magnanimity, signal a depression is nigh. It does, however, point to the overall political corruption, economic stupidity, and outright socialist mentality of those wanting to grow government and their own greed - people like Chistopher Dodd, Barney Frank, Barack Obama, Joe Biden, Nancy Pelosi, and Harry Reid.

To fix it, we should not allow those Democrats to continue to serve in the public sector in any capacity.

Learn more about this author, Kenneth Boser II.
Click here to send this author comments or questions.

Add your voice

Know something about Is the US facing another economic depression??
We want to hear your view. Write now!