IAP Political Forum

A Catastrophe Foretold
By PAUL KRUGMAN
Published: October 26, 2007

“Increased subprime lending has been associated with higher levels of delinquency, foreclosure and, in some cases, abusive lending practices.” So declared Edward M. Gramlich, a Federal Reserve official.

These days a lot of people are saying things like that about subprime loans — mortgages issued to buyers who don’t meet the normal financial criteria for a home loan. But here’s the thing: Mr. Gramlich said those words in May 2004.

And it wasn’t his first warning. In his last book, Mr. Gramlich, who recently died of cancer, revealed that he tried to get Alan Greenspan to increase oversight of subprime lending as early as 2000, but got nowhere.

So why was nothing done to avert the subprime fiasco?

Before I try to answer that question, there are a few things you should know.

First, the situation for both borrowers and investors looks increasingly dire.

A new report from Congress’s Joint Economic Committee predicts that there will be two million foreclosures on subprime mortgages by the end of next year. That’s two million American families facing the humiliation and financial pain of losing their homes.

At the same time, investors who bought assets backed by subprime loans are continuing to suffer severe losses. Everything suggests that there will be many more stories like that of Merrill Lynch, which has just announced an $8.4 billion write-down because of bad loans — $3 billion more than it had announced just a few weeks earlier.

Second, much if not most of the subprime lending that is now going so catastrophically bad took place after it was clear to many of us that there was a serious housing bubble, and after people like Mr. Gramlich had issued public warnings about the subprime situation. As late as 2003, subprime loans accounted for only 8.5 percent of the value of mortgages issued in this country. In 2005 and 2006, the peak years of the housing bubble, subprime was 20 percent of the total — and the delinquency rates on recent subprime loans are much higher than those on older loans.

So, once again, why was nothing done to head off this disaster? The answer is ideology.

In a paper presented just before his death, Mr. Gramlich wrote that “the subprime market was the Wild West. Over half the mortgage loans were made by independent lenders without any federal supervision.” What he didn’t mention was that this was the way the laissez-faire ideologues ruling Washington — a group that very much included Mr. Greenspan — wanted it. They were and are men who believe that government is always the problem, never the solution, that regulation is always a bad thing.

Unfortunately, assertions that unregulated financial markets would take care of themselves have proved as wrong as claims that deregulation would reduce electricity prices.

As Barney Frank, the chairman of the House Financial Services Committee, put it in a recent op-ed article in The Boston Globe, the surge of subprime lending was a sort of “natural experiment” testing the theories of those who favor radical deregulation of financial markets. And the lessons, as Mr. Frank said, are clear: “To the extent that the system did work, it is because of prudential regulation and oversight. Where it was absent, the result was tragedy.”

In fact, both borrowers and investors got scammed.

I’ve written before about the way investors in securities backed by subprime loans were assured that they were buying AAA assets, only to suddenly find that what they really owned were junk bonds. This shock has produced a crisis of confidence in financial markets, which poses a serious threat to the economy.

But the greater tragedy is the one facing borrowers who were offered what they were told were good deals, only to find themselves in a debt trap.

In his final paper, Mr. Gramlich stressed the extent to which unregulated lending is prone to the “abusive lending practices” he mentioned in his 2004 warning. The fact is that many borrowers are ill-equipped to make judgments about “exotic” loans, like subprime loans that offer a low initial “teaser” rate that suddenly jumps after two years, and that include prepayment penalties preventing the borrowers from undoing their mistakes.

Yet such loans were primarily offered to those least able to evaluate them. “Why are the most risky loan products sold to the least sophisticated borrowers?” Mr. Gramlich asked. “The question answers itself — the least sophisticated borrowers are probably duped into taking these products.” And “the predictable result was carnage.”

Mr. Frank is now trying to push through legislation that extends moderate regulation to the subprime market. Despite the scale of the disaster, he’s facing an uphill fight: money still talks in Washington, and the mortgage industry is a huge source of campaign finance. But maybe the subprime catastrophe will be enough to remind us why financial regulation was introduced in the first place.

I'm fine with oversight and punishment for companies that commit crimes... but there is a limit?

It's one thing to punish an evil compnay for things it *DID* but it's quite another to hinder all of them to prevent one from doing harm.

I'm fine with oversight and punishment for companies that commit crimes... but there is a limit?

It's one thing to punish an evil compnay for things it *DID* but it's quite another to hinder all of them to prevent one from doing harm.

As I said, rpevention is better than retribution. There's always rotten apples and figuring you'll just deal with them once there's a scandal is damaging to the consumer. The USA have been having an annoying trend of "first time" corporate scandals, you know?

This "who would had figured there would be rotten apples?" attitude does not suit well to a country where the individual is supposed to be of paramount importance -the message to cynical corporations is, "screw them while you can as nobody is going to watch until you've screwed them too much"... that should not be the case. A Spanish syaing goes like "an opportunity makes the thieve", meaning that carelessneess is an invitation to crime...

These stories should be a dime a dozen, they happen so frequently (savings and loans, fake energy crisis in California). Seems like on average once or twice a decade some segment of society gets burned by some under-regulated industry making a killing off the ignorance or desperation of others.
In the interests of public service, here's yet another example of how government can make life better, and how, when it's stripped away by ideologues, its absence makes people's lives worse.

If this was the case Hillary would be in jail for her involvement in the saving and loan scam.

What a great point that would be except for:

1) It is completely irrelevant to the discussion, which is the degree to which government should regulate business, and
2) Clinton had no notorious involvement with the savings and loan scam.

Other than that, great point.

Jury Gets Case of Arkansas Governor and Clinton's Ex-Partners
By ALLEN R. MYERSON
Federal fraud charges against two Whitewater business partners of Bill and Hillary Rodham Clinton, as well as the Governor of Arkansas, went to a jury shortly after noon today. The Clintons' former partners, James B. McDougal and his former wife, Susan, along with Gov. Jim Guy Tucker, are accused of conspiring to obtain millions of dollars in federally backed loans from Madison Guaranty Savings and Loan in the 1980's. Madison was controlled by the McDougals but collapsed in 1989 at a cost to ta...

Houm... and what about a bit of PREVENTION as better than RETRIBUTION?

Houm... and what about a bit of PREVENTION as better than RETRIBUTION?

Low salaries and underemployment with a precarious sub-prime loaning market is the cause of much financial and social instability. This of course is allowed to continue under a government that faithfully and foolishly preaches the benefits of deregulation, completely disregarding the welfare of its citizens.

Careful. If that idea starts getting much currency, the whole Republican "tough on crime" dogma goes out the window.

He has held chairs of Economics in Yale, MIT, and Stanford. He's currently professor of Economics and International Affairs at Princeton University.

I don't care if he won the Olympic Gold.

If he is using bad statistics to push his agenda, he has pretty much sold out for his politics.

You should do a study on how joint committees in congress work, I am sure Krugman has, he would have done better to have used something else.

Care to tell us why Krugman did not inform his audience that only 4 percent of loans are subprime?  Did he think that statistic was unimportant?  Or perhaps that it would undermine his ability to cry wolf.

Hiding behind medals doesn't do much for the truth now does it?  Or are you willing to do the same?  It goes to credibility, or in your case, lets hope naivite in understanding economics and politics.

Baldar wrote: "Also the report itself is fraught with some disengenuous use of statistics.  For instance, they will take the month with the highest number of mortgages and then "extrapolate" that large number as an equal for every proceeding month.  This is done in order to show the "dire consequences".  Krugman knows this, and yet he uses it as if to show the "objectivity" of the number speaks for itself."

Is that right, Baldar? Have any sources or references to back that up? I notice that you're often long on assertions and short on sources. And could you explain to all of us what a "proceeding month" is? Did you mean preceding? Or did you mean subsequent?

Very tough trying to read many of your posts. Is English a second language for you? Sprechen Sie Deutch?

Since you're the one who claimed that he is "a joke among economists of note," which I showed is absolutely false, I would say that you're the one with the credibility problem, not him.

Consider Enron and its wholesale fraud.  It no longer exists.  Consider also Arther Andersen the auditing firm in which one local senior partner took part in the Enron fraud (I also lost a nice chunk of change on the deal).  The auditing firm no longer exists.  It was, by the way, the biggest and most prestigious auditing firm in the world.

I think for the most part our system does work.

On top of that we have the Sarbanes-Oxley requirements which are so onerous that companies are no reversing and going private rather than deal with a cost that tends to equal 10% of revenue.

As to Krugman, he is a joke among economists of note.  He sucks up to the camera quite a bit.  Some factual issues to contend with.  The report by the "Joint Economic Committee" tends to reflect the desires of the majority party.  More to the point the majority on the committee usually votes to strike anything that might be considered, shall we say, mitigating.  In other words they write what the majority party wants them to write.  Also the report itself is fraught with some disengenuous use of statistics.  For instance, they will take the month with the highest number of mortgages and then "extrapolate" that large number as an equal for every proceeding month.  This is done in order to show the "dire consequences".  Krugman knows this, and yet he uses it as if to show the "objectivity" of the number speaks for itself.  I believe, the number does speak for itself, but of course unlike Krugman, who wil not tell you, I do have an idea as to how that number is derived.  Its one reason Krugman has no credibility where he is concerned.  He will use dirty misaligned statistics for political reasons rather than research and show exactly what the problem might be.


Again, Krugman does not tell you that subprimes make up 4% of the overall loan market.  Now why is that?  Why isnt he up front and honest on that level?

These are only two key examples of why I don't trust Krugman and also why I feel the post is disengenuous.  If you know nothing about the loan financing the story is indeed very very scary.  However if you do know even a few key statistics and issues, you can see past the contextual falsehoods and wonder how anyone can believe this stuff.

I think the loan market has served us well, I believe it continues to do so.  I don't believe it is perfect, but I certainly don't believe it as risen to the standard that the government must, in a knee jerk reaction, come in and take it over.  Its that kind of leftist thinking that usually screws people out of their right to make decisions.

Anyway, that is my point of view, and yes, I am not a huge fan of big government, though sometimes I do think it is needed, but the action should be rare and prudent, not reactive and over the top.

Low salaries? Where?

Underemployment? Compared to what?

For real household incomes, the median point - the level at which half of households earn more and half less - has actually fallen over the past five years.

According to many analysts, the American economy continues to expand and yet average wages remain stagnant. A report from the Economic Policy Institute specifically states that:


There are also of course countless examples of families requiring multiple incomes to survive.

I realize its tough for you to read the posts.  You are relatively uneducated.  Proceeding I suppose could be better used with subsequen, shrug, subsequent is also good.  Lets hope you don't hang your hat on that, though it seems it is all you haveleft.

English is my second language.  And yet, I find I still speak it better than you do, or in the least, I am much more able to converse at a higher level. Don't hate me because I am beautiful.  ;)

I suggest you do some reading up on how join committees work.  While carrying out some US/UN authorized work in third world countries I had one hell of a wake up call as to how the committees work with majority votes making the decisions.  Perhaps you are naive enough to believe that committees will gladly accept all information and place that information openly in reports.

I know different.  Maybe you need to think about it a while?

Buisness, while it's goal is to make money, is not intentionally trying to screw people.

We don't need regulation-we need nationalization.

OswaldTheOsprey

Nationalization is in effect total regulation. I agree that certain things, like utilities should not be in private hands. That is as stupid as privatizing highways and prisons. National health is also the only alternative. But, beyond that, I stop.

Want a more effective way to stop illegal workers than cracking down on them? Crack down on the businesses that hire them, with jail time. Illegal migration will end tomorrow. Migrants (most DO NOT stay here) are used to suffering and humiliation, that's why they are coming here. A nice, middle class businessman, though, is different. Throw one in jail and watch the rest of them, "see the light" about hiring illegals. They'll have to raise their wages to hire Americans, some business will go under, most will survive. 

I don't think you've ever said anything more naive. Maybe when you need to pay your own bills...

$3.00 fees to get your money from an ATM? Maybe a bank card that lets you over-draw your account, just so the bank can collect the 32 dollar fee, then a week after, charge you 7 bucks a day until it is paid. ALL banks do this. If they didn't want to screw you, your bank card would be declined, when you try to charge more than is in your account. There is absolutely no reason they can't just cut you off, except that they want the fees.

When I was a kid, you put money in a bank and it accrued interest, after all, they are using YOUR money to make THIER profit. Now your interest is eaten up in fees. Love it! Charging you money to make money off YOUR money.

How about these places that offer loans to get you by a week, just till your next paycheck? Your rent is coming up. You are desperate. You go to one of these places. Know what they charge? 98% APR. Yes, you grew up in a time, when no one would dare say business is bad. Business is good, people are bad. You were too young to remember when "greed is good" became the American mantra. It still is today.

Greed isn't about screwing people?

Nationalization is in effect total regulation. I agree that certain things, like utilities should not be in private hands. That is as stupid as privatizing highways and prisons. National health is also the only alternative. But, beyond that, I stop.

Want a more effective way to stop illegal workers than cracking down on them? Crack down on the businesses that hire them, with jail time. Illegal migration will end tomorrow. Migrants (most DO NOT stay here) are used to suffering and humiliation, that's why they are coming here. A nice, middle class businessman, though, is different. Throw one in jail and watch the rest of them, "see the light" about hiring illegals. They'll have to raise their wages to hire Americans, some business will go under, most will survive. 

You're blaming BANKS when you overdraw your own account?

HYSTERICAL!

In a standard svaings account or CD you shouldn't have to worry about anything except the initial fee.

Maybe you're just irresponcible.

No, it's about getting money.

Screwing people is a side effect.

Hysterical is actually trying to tell me that this isn't common sense: NO MONEY IN ACCOUNT, BANK NO PAY BILL. A cat could understand that. But not you, you think it is wonderful that they LET you overdraw your account, so they can charge you a fee.

Irresponsible? What is your bank, genius? The Bank of Mom and Dad? Oh, no, they just pay your bills. Yes, Commerce bank ATMs are wherever you need them when you want to spend your allowance.

I work 45 hours a week AND go to school full time and every month I still have to choose between paying Rent, Electric, Phone, water, gas and my debts, you snotty little prick. I generally go without eating and have no life. And, no, punk, I can't get a better job. With my school hours, I need optimum flexibility, not offered in higher paying work.

LOL!!! Oh, right, greed is about playing nice and baking cookies and just happening to make money.

Definitions, kid, definitions:

    * excessive desire to acquire or possess more (especially more material wealth) than one needs or deserves
    * avarice: reprehensible acquisitiveness; insatiable desire for wealth
      wordnet.princeton.edu/perl/webwn
    * Greed is excessive or uncontrolled desire for or pursuit of money, wealth, food, or other possessions, especially when this denies the same goods to others.

Like, say pregnancy is a side-effect of rape.

Hmmm, my ears were burning and I didn't know why...

How about a compromise somewhere in the middle? We take reasonable steps to limit predatory lending practices, and we also don't rush to compensate people who make poor choices.

If you're looking for those who refuse to take responsibility for their actions, I think you can find many, many examples in industry. The high and mighty have countless protections from the consequences of their recklessness.

Surely you're not advocating that we should turn a blind eye to misleading or deceptive financial offers, are you? Who is avoiding responsibility now?

Right. Compassion is all well and good as long as it doesn't cost the rest of us anything.

Education. That's the answer. We could send everyone back to personal finance, one-oh-one. I'm sure the lending industry would be happy to sponsor it...

The national downturn in the housing market has arrived in Loudoun County, a once-largely rural area on the western fringes of Washington [D.C.] that has become one of the fastest-growing regions in the United States. In addition to the economic effect, it's stirring anxiety and discontent that have begun to change the climate in which people consider politics — especially some Republicans.

"I used to consider myself a Republican, but now I consider myself an independent," [Karla] Schroeder said.

The shift is not confined to one county in the mid-Atlantic region. Similar rumblings of discontent can be heard among GOP voters in fast-growing areas across the country that are being hit by the housing crunch, including parts of Florida and Nevada.

....Tom Slade, who helped build the Florida Republican Party and is a former state chairman, knows firsthand the anxieties stirred by the housing downturn, and he thinks the political fallout could be significant.

...."How deep, bad and big this monster will turn out to be is not clear yet, but it has the potential to turn wickedly mean," Slade said. "Who gets the biggest thumping is anyone's guess, but I would guess it would be the Republicans since we've had control of the executive branch."

This is the granddaddy of political polling questions not just because it is venerable but because it has earned its keep. If you had to pick only one political indicator as the most fundamental of all, this would be a good choice—because, to a first approximation, the party of prosperity is the default majority party.

The chart begins in 1951, when Harry Truman was president, and it shows how decisively the Depression and New Deal had bestowed "party of prosperity" status on the Democrats. Only occasionally did the Republicans even touch them. The Democrats' prosperity advantage seemed to be their birthright, part of the natural order of things, unlikely to be challenged or changed. Even well into the 1970s, as stagflation set in, few Democrats foresaw the trouble ahead.

Oh yes, we live in such a black and white world.

I don't know anyone foolish enough to have taken out an adjustable rate mortgage, because my friends are educated and sophisticated enough to know better.
But there are people out there who are unsophisticated and not so well educated who don't know what an ARM is, but just see the promise of a lower mortgage payment.

So companies take advantage of their ignorance. Knowingly, and deliberately. They prey on people's gullability. They take their profits and then run, secured from any consequences by having set up the rules to shield themselves.

I say we restrict predatory lenders like this to the maximum extent possible. I say we compensate victims of these sharks and thieves.
It's called compassion for the victims and no compassion for the perps.

Funny how some of you get "personal responsibility" all backwards.

jpn,

What in heck are you talking about?

First off, you like to throw accusations of predatory lending around, but you do not even show one example.  Can you demonstrate, much less prove, that these lenders tried to hide the fact that ARM's rates change, adjust, over time? 

Lastly, your statement about you and your friends and how educated and sophisticated you are to avoid ARMs.  What an insulting, condescending, arrogant elitist stance.

I think everybody can agree that predatory lending happens. 

JPN

What in heck are you talking about?

First off, you like to throw accusations of predatory lending around, but you do not even show one example.  Can you demonstrate, much less prove, that these lenders tried to hide the fact that ARM's rates change, adjust, over time?  Can you prove they tried to hide from borrowers that interest only mortgages payments go up significantly when the interest only period ends and the principal payments begin?  There are NOW, already, for a long time, regulations on the books that require lenders to disclose this kind of stuff.  Are you claiming there are folks out there buying 3, 4 and 5 hundred thousand dollar houses who cannot even read a repayment schedule?  Bummer for them.  And if there are lenders who DID violate the existing disclosure rules, I am all for going after them.  Hell, it will likely be win win to throw them in jail, as many are going bankrupt and will need a place to live and three squares a day.

Second, these predatory lenders take advantage of these poor folks, and run with their profits.  Wait a minute, WHAT PROFITS?  These predatory lenders gave these poor, slow witted unsophisticated victims you describe that 3, 4, 5 hundred thousand dollars to buy the house, and before ANY of that principal was paid back in many cases, and very little in others, those victims stopped paying these lenders back.  So they foreclose.  Great, now these predators as you call them, say pay out 350,000 to buy a house for their victim.  Victim pays a year or two of mortgage payments at very low rates, say 20,000 total.  Now, even if you discount overhead and apply ALL of that 20K back against the initial pay 350K payout, these evil predators running with their profits are now 330,000 deep into a house that in the current market is work about 250K.  That is assuming you could get anybody to actually buy it.  Where these profits you keep talking about, and why are such profitable predatory lending companies going belly up?

Lastly, your statement about you and your friends and how educated and sophisticated you are to avoid ARMs.  What an insulting, condescending, arrogant elitist stance.  "I am wonderful mr liberal, I will fight the good fight against your oppressors you poor, stupid, befuddled little bumkins who cannot think for yourselves so I will think for you".  I have to tell you, my impression from your statement is that you and your friends, far from being so sophisticated, do not understand ARMs.  But maybe I am just an unsophisticated bumpkin.  The first mortgage I ever got was an ARM.  It started at under 5%.  I knew very little about mortgages, and I was relatively young.  But I knew enough to check what my potential downside was, and my upside.  My upside was that I had lower initial payments, the downside was that the rate could "adjust" (hence the A in ARM, you really think people except you and your buddies are too stupid to see that?) in my case, the maximum adjustment either way in any one year was 1%, and it could not adjust higher than 10%.  So my biggest possible downside was in a little over 5 years I could be paying a mortgage at 10%.  I knew worse come to worst, I could afford that.  So I took the mortgage, and actually paid the equivalent payment of the loan at 2 or three points higher than it was currently at.  So I built more equity early on in the loan, and then after about 3 years refinanced into a fixed.  Sometimes they make since.  But again, I guess I am not as cool and sophisticated as you and your buddies. 

I think everybody can agree that predatory lending happens.

jpn,

What in heck are you talking about?

First off, you like to throw accusations of predatory lending around, but you do not even show one example.  Can you demonstrate, much less prove, that these lenders tried to hide the fact that ARM's rates change, adjust, over time?  Can you prove they tried to hide from borrowers that interest only mortgages payments go up significantly when the interest only period ends and the principal payments begin?  There are NOW, already, for a long time, regulations on the books that require lenders to disclose this kind of stuff.  Are you claiming there are folks out there buying 3, 4 and 5 hundred thousand dollar houses who cannot even read a repayment schedule?  Bummer for them.  And if there are lenders who DID violate the existing disclosure rules, I am all for going after them.  Hell, it will likely be win win to throw them in jail, as many are going bankrupt and will need a place to live and three squares a day.

Second, these predatory lenders take advantage of these poor folks, and run with their profits.  Wait a minute, WHAT PROFITS?  These predatory lenders gave these poor, slow witted unsophisticated victims you describe that 3, 4, 5 hundred thousand dollars to buy the house, and before ANY of that principal was paid back in many cases, and very little in others, those victims stopped paying these lenders back.  So they foreclose.  Great, now these predators as you call them, say pay out 350,000 to buy a house for their victim.  Victim pays a year or two of mortgage payments at very low rates, say 20,000 total.  Now, even if you discount overhead and apply ALL of that 20K back against the initial pay 350K payout, these evil predators running with their profits are now 330,000 deep into a house that in the current market is work about 250K.  That is assuming you could get anybody to actually buy it.  Where these profits you keep talking about, and why are such profitable predatory lending companies going belly up?

Lastly, your statement about you and your friends and how educated and sophisticated you are to avoid ARMs.  What an insulting, condescending, arrogant elitist stance.  "I am wonderful mr liberal, I will fight the good fight against your oppressors you poor, stupid, befuddled little bumkins who cannot think for yourselves so I will think for you".  I have to tell you, my impression from your statement is that you and your friends, far from being so sophisticated, do not understand ARMs.  But maybe I am just an unsophisticated bumpkin.  The first mortgage I ever got was an ARM.  It started at under 5%.  I knew very little about mortgages, and I was relatively young.  But I knew enough to check what my potential downside was, and my upside.  My upside was that I had lower initial payments, the downside was that the rate could "adjust" (hence the A in ARM, you really think people except you and your buddies are too stupid to see that?) in my case, the maximum adjustment either way in any one year was 1%, and it could not adjust higher than 10%.  So my biggest possible downside was in a little over 5 years I could be paying a mortgage at 10%.  I knew worse come to worst, I could afford that.  So I took the mortgage, and actually paid the equivalent payment of the loan at 2 or three points higher than it was currently at.  So I built more equity early on in the loan, and then after about 3 years refinanced into a fixed.  Sometimes they make since.  But again, I guess I am not as cool and sophisticated as you and your buddies. 

What I got from his posts was that he didn't necessarily believe that selling ARM's qualified as predatory.  That, and that buyers should beware.  Meaning informed. 

Yeah, they should be informed. But as Gompers himself proves, people often are not.

Biker is of course correct, we all can agree there ARE predatory and unscupulous lenders out there who should be punished.  I never said otherwise.  What I belive is just a figment of your fevered imagination is that the predatory lenders are what caused the current crisses in the mortgage industry.  That and this silly idea you seem to have that all ARMs are an example of predatory lending.  I hope I am actually uninformed and mistaken about that, and that you do not actually believe that ALL ARM's are predatory practices that should be regulated out of existence.  Because otherwise, your last statement is correct, and I have proven that people are often not informed, although in such a case I would simply state that it was never my intent to prove you so woefully uninformed, it just sort of worked out that way.

Biker is of course correct, we all can agree there ARE predatory and unscupulous lenders out there who should be punished.  I never said otherwise.  What I belive is just a figment of your fevered imagination is that the predatory lenders are what caused the current crisses in the mortgage industry.

That and this silly idea you seem to have that all ARMs are an example of predatory lending.  I hope I am actually uninformed and mistaken about that, and that you do not actually believe that ALL ARM's are predatory practices that should be regulated out of existence.  Because otherwise, your last statement is correct, and I have proven that people are often not informed, although in such a case I would simply state that it was never my intent to prove you so woefully uninformed, it just sort of worked out that way.

Okay, so we've gone from:

"First off, you like to throw accusations of predatory lending around, but you do not even show one example"

to,

"Biker is of course correct, we all can agree there ARE predatory and unscupulous lenders out there who should be punished.  I never said otherwise.  What I belive is just a figment of your fevered imagination is that the predatory lenders are what caused the current crisses in the mortgage industry."

to,

"Didn't have ANYTHING to do with it?  Oh I am sure they are in there."

It's been quite a journey.