Conservatives liked it because of the idea that homeowners would become part of the “ownership” society, more stable, taxpaying (and more likely GOP) voters; liberals liked it because it allowed poor and minorities access to the middle class.

Nearly everyone profited from the spectacular rise in home ownership and prices; Some more than others, but trying to pin this on this politician or that regulation is absurd.

In retrospect, TARP appears more an more to have been yet another con job by well connected insiders, evidence of Naomi Klein’s “Shock Doctrine” at work.

Meanwhile, the whole “too big to fail” thing came at the tail end of the crises. By the time that became policy, the economy was already in the crapper. In fact, it became policy because the economy was in the crapper, and the Fed was desperately trying to keep the tank from being flushed.

Easy money from the Fed? Yeah – without that easy money there probably would have been just a steady decline in the economy under Bush, but I’ll agree that it was a problem. I fully expected Greenspan to jack up interest rates when the money supply was expanding so rapidly thanks to the deficit and to all the paper transactions … but the Fed decided to play along. Then again, there was tremendous political pressure on the Fed – had they not played along, and the economy stagnated under Bushinomics, they would have gotten the blame.

Again, however, we’re talking enabling – not encouraging. The Fed wasn’t inceitivizing people to overleverage their companies. That was pure, unadulterated greed. Bad acting en masse.

A funny anecdote – other day I heard someone say that the reason stuff like this hadn’t happened in the past was because in the past the Financial Sector wasn’t run by the smartest of the smart … but by a middle tier of guys who just wanted to make a good living and enjoy their week each summer in the Hamptons and send their kids to an Ivy League College. However, in the last decades the smart guys moved in, and they wanted to be bazillionaires and own estates in the Hamptons and buy new dormatories for Ivy League Colleges. And so they started creating financial products that the regulatory community wasn’t able to even understand, much less regulate, and they were basically making bigger and bigger bets against one another to try to be master of the universe … and they all were playing with house money, until the housing bubble burst – an inevitibility because housing bubbles always burst – and nobody could pay the house back.

But it wasn’t because Wall Street wasn’t filled with enough smarts – it’s because Wall Street no longer had the stodgy gatekeepers who had guarded the institutions for so many decades.

1) Easy money from the Fed
2) Community Reinvestment Act
3) Implied immunity from bankruptcy via the “discount window” by the Fed

In other words free access to money, legally enforced extortion from the forcing of bad loans, and a moral hazard created by being declared “too big to fail.”

If banks were responsible for making their own profits or going broke, we’d be in a lot better position right now.

I’m sorry – I still don’t understand what “incentive” government provided for executives to take such extraorinary risks with their companies futures.

Even Alan Greenspan was stymied – “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,”

I guess that underregulation and lack of enforcement can be called “providing an incentive” – but that seems to me as perverse as blaming anyone who doesn’t have a home alarm for “providing an incentive” to house robbers.

Really? It was perverse incentives created by the political elite that caused investment firms to deal in derivatives and credit-default swaps until firms like Bear Stearns had a debt-to-equity ratio of 33-1?

That didn’t have to do with risk taking and greed?

As you clearly have no understanding whatsoever of finance or economics, it’s not worth a reply. Why don’t you begin by reading “Economics in One Lesson” by Henry Hazlitt?

I think that any party that sits around planning business activities is going to end up as tyrannical. We should have our federal government stick to its Constitutional limits, and avoid what we have here: a complete mockery of political discourse, descending as it has into several personal opinions on how multibillion dollar companies can and should run according to, at best, very peripheral knowledge. Don’t you central planners have any modesty?

“Rule of law” is for suckers and Republicans. King Obama and his satraps know better.Why not? They learned from Mr. Cheney and The Decider, who learned it from Billary, who learned from Daddy Bush, who got it from The Gipper.

Obama has already told us he’s not satisfied with the Constitution. Too “restrictive.”

Obama wants to be king. He wants his word to be law. FDR had the same problem. But in those days “But what you want to do is unconstitutional!” meant something.

Now the idea of the Constitution is rather quaint . Sort of like the Ten Commandments. Good idea in principle, but gets in the way of my will.

Rahm Emanuel told us also that the “crisis” allows him to do things he normally couldn’t do.

“Rule of law” is for suckers and Republicans. King Obama and his satraps know better.

But beware: when contracts large or small are no longer honored, we are done with.

Failure of contracts is why nothing can be done in Africa or South America. Who will invest in a place that will not honor contracts?

How many cars would they have to sell just to get to even, much less make a profit? And then there’s the little problem of paying back the bailout.

Ain’t gonna happen.

GM is bankrupt. Period. To pretend otherwise is silly.

Then again the government owes, what, $13 trillion?

$1.4 trillion deficit this year and for as far as Obama can see?