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Can We Survive the Next Financial Crisis?

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Re: Can We Survive the Next Financial Crisis?

#81

Post by izacus »

travisoneill1 wrote: post #49
y-c-o-m-b wrote: post #21

The definition of "we" and "survive" needs to be established clearly first and I don't think all those fancy graphs and market trends will define them. There's a lot of people that ended up bankrupt, in a bottomless depression, turned to drug abuse or committed suicide because of the last crisis. Wages are still relatively low while prices continue to climb. Many people are working 2-3 jobs and having trouble affordi…

The data doesn't support your conclusion. Almost nobody keeps all their assets in a savings account. What you should be looking at is net worth. https://dqydj.com/net-worth-by-age-calculator-united-states/

What exactly are they keeping their assets in? A house that they can't sell and make that worth liquid? A retirement account they cannot withdraw without huge costs and compromising old age? Where else?

Re: Can We Survive the Next Financial Crisis?

#82

Post by travisoneill1 »

darawk wrote: post #57

> The leveraged loans are now being packaged into collateralized loan obligations and sold to investors. Sound familiar? And the CLO market has grown to match the size of the CDO market at its pre-crisis peak. Yet one major difference makes the CLOs of today less scary: The loans that comprise them are backed by collateral, and if one of the companies in the mix defaults, an investor can find recourse through the sal…

Yeah, that doesn't make any sense. The reason CDO's were underwater is because the price of housing dropped and left the collateral worth less than the principal of the loan. Loans to companies follow the same principal. If the value of companies suddenly drops same thing. It's a weird statement and is directly contradicted by the next paragraph in the article.

Re: Can We Survive the Next Financial Crisis?

#83

Post by LyndsySimon »

ben_jones wrote: post #52
HashThis wrote: post #5

The surprise that is coming is that the working class won't tolerate being robbed in the next financial crisis. Working American's had to financially absorb the 2008 Mortgage crisis. 2008 was a direct robbery because Mortgage Orginators KNEW the mortgages would blow up, because their own Underwriting equations said they would. That is why they did fraud on the customer's income levels or worked with politicians to al…

If you're hinting at a revolution, a.k.a. what used to be a check against the upper classes, you can't really have one of those when every police department has a tank, a swat team, and carte blanc access to all social media and mobile data/communications.

In most of America (geographically, certainly), the common citizenry are much better armed than law enforcement.

I'm not sure that's really relevant in this case, but by the same token, the "increasing militarization" of police departments is probably also not relevant.

Re: Can We Survive the Next Financial Crisis?

#84

Post by nabla9 »

wallacoloo wrote: post #79
nabla9 wrote: post #63

Earlier quoted context omitted.

For the discussion in relatively high quality formus like HN to survive there needs to be new rule adopted: Nobody is allowed to criticize or discuss the title of the article. Only the content in the body of the article. These titles are usually written by editors who think in clicks and they are not the original titles from the writers. This was good and interesting article but unless we discuss the content (and rea…

Many readers at HN find posts with interesting titles, skim the comments, and then read the article. Discussion of the title is useful for them, because if a commenter reveals that the title is misleading, the reader might choose to read something else, or approach the article with a different frame of mind. Point being: there is some value in discussing the title. Certainly different readers value that discussion mo…

> because if a commenter reveals that the title is misleading

This is rarely the case.

Usually (as is the case here). The commenter uses the title title as a statement and criticizes it directly, not it's relation to the article.

It seems to me that people read the title, and come here to comment the title before reading the article.

Re: Can We Survive the Next Financial Crisis?

#85

Post by oihoaihsfoiahsf »

chadbaud wrote: post #71
oihoaihsfoiahsf wrote: post #51

Earlier quoted context omitted.

Yes, the banks were part of the cause. That is not in dispute, as you can see by reading my previous comments. But they would not have been able to commit their fraud without the aid of credulous buyers willing to purchase far more house than they could afford. That's all I'm saying.

In a functioning market, a buyer would not have received a loan, no matter how much they wanted to over extend themselves. But, because fraud was being committed from the rating agencies, investment banks and mortgage originators, they got the loan. I understand what you saying, but I think you underestimate the lack of accountability that allowed people to get loans they were not in the best interest of anyone.

I guess my thing is more of a reaction against paternalism and the infantilization of the public. I do think there need to be much more in the way of bank regulations. I don't think the public ought to absolve itself of all responsibility because of the absence of some regulations. I just don't think it's healthy or necessarily leads to better decisions being made in the future. I want an informed public, not a deluded one.

Re: Can We Survive the Next Financial Crisis?

#86

Post by mrep »

andrewla wrote: post #55
HashThis wrote: post #5

The surprise that is coming is that the working class won't tolerate being robbed in the next financial crisis. Working American's had to financially absorb the 2008 Mortgage crisis. 2008 was a direct robbery because Mortgage Orginators KNEW the mortgages would blow up, because their own Underwriting equations said they would. That is why they did fraud on the customer's income levels or worked with politicians to al…

> The surprise will come the next time a Financial Crisis comes and the government works to sell out the working class Meh. There won't be any surprise at all. Even now, people who are outraged about the bailouts are just the lunatic fringe libertarians (like myself) and some equally fringe progressives. Almost everyone I talk to about it says, "yeah, it's too bad that we had to give Citibank billions of dollars, but…

To be fair, lehman brothers was allowed to fail so all those bankers lost their jobs.

Re: Can We Survive the Next Financial Crisis?

#87

Post by icedchai »

izacus wrote: post #81
travisoneill1 wrote: post #49

Earlier quoted context omitted.

The data doesn't support your conclusion. Almost nobody keeps all their assets in a savings account. What you should be looking at is net worth. https://dqydj.com/net-worth-by-age-calculator-united-states/

What exactly are they keeping their assets in? A house that they can't sell and make that worth liquid? A retirement account they cannot withdraw without huge costs and compromising old age? Where else?

Uh, you ever hear of taxable investment accounts? Online brokerages, mutual funds, etc?

Re: Can We Survive the Next Financial Crisis?

#88

Post by clairity »

travisoneill1 wrote: post #67
linuxftw wrote: post #43

Earlier quoted context omitted.

I agree. It's I don't care if banks survive as long as I'm not negatively impacted. I'm sure the banks feel the same way. Survive also doesn't mean 'maintain standard of living.' The government has a surefire way of propping up the wealthy: Inflation. Savings accounts lose purchasing power (normal person) and the means of production gets more expensive (wealthy).

This is backwards. Inflation destroys the value of debt. Poor tend to be borrowers and rich tend to be lenders, so inflation is an equalizer.

no, the wealthy keep their capital in assets with above average returns. the rest of us get to pay for that with below average returns, fees, and inflation.

Re: Can We Survive the Next Financial Crisis?

#89

Post by TomMckenny »

ryandrake wrote: post #64
HashThis wrote: post #5

The surprise that is coming is that the working class won't tolerate being robbed in the next financial crisis. Working American's had to financially absorb the 2008 Mortgage crisis. 2008 was a direct robbery because Mortgage Orginators KNEW the mortgages would blow up, because their own Underwriting equations said they would. That is why they did fraud on the customer's income levels or worked with politicians to al…

The 1%, including politicians, will find some other wedge social issue to keep the working and middle classes continually fighting each other, allowing the rich to keep siphoning off the world’s wealth. The day after the crash, headlines will be back to “transsexual bathrooms” and “football stars kneeling” and we will forget that we are losing our jobs and homes again. This play book is not new. My prediction for the…

The pattern won't repeat forever, eventually the wealth transfer will become an unnoticed constant flow.

Regardless of the "it can't happen hear" attitude, the US is clearly following the identical trajectory of about a dozen other countries which have fallen into demagogue led neo-autocracies blaming easy targets for their woes.

The only real question is whether we're talking about the future or the present.

Re: Can We Survive the Next Financial Crisis?

#90

Post by maxander »

icedchai wrote: post #87
izacus wrote: post #81

Earlier quoted context omitted.

What exactly are they keeping their assets in? A house that they can't sell and make that worth liquid? A retirement account they cannot withdraw without huge costs and compromising old age? Where else?

Uh, you ever hear of taxable investment accounts? Online brokerages, mutual funds, etc?

The average HNer probably has, yes. The average American, quite possibly not.
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