In Which Zandar Loses His Temper Completely And Fails To Be Dispassionate

The meltdown on Wall Street?

It's not Wall Street's greed. It's not lack of regulation. It's not arcane and byzantine debt packaging. It's

It's all those goddamn poor black people that those evil liberal Democrats forced Wall Street to give loans to in the name of affirmative action and that of course has ruined our patriotic American banking system.

No, seriously.

OK .. so we all know that a lot of really bad real estate loans were made. The political class would sure love for us to believe that the blame here rests squarely on “greedy” (try to define that word) mortgage brokers and lenders. The truth is that most of the blame rests on political meddling in the credit decisions of these mortgage lenders.

Twenty years ago the buzz-word in the media was “redlining.” Newspapers across the country were filled with hard-hitting investigative reports about evil and racist mortgage lenders refusing to make real estate loans to various minorities and to applicants who lived in lower-income neighborhoods. There I was closing these loans in the afternoons, and in the mornings offering a counter-argument on the radio to these absurd “redlining” claims. Frankly, the claims that evil mortgage lenders were systematically denying loans to blacks and other minorities were a lot sexier on the radio than my claims that when credit histories, job stability, loan-to-value ratios and income levels were considered there was no evident racial discrimination.

Political correctness won the day. Washington made it clear to banks and other lending institutions that if they did not do something .. and fast .. to bring more minorities and low-income Americans into the world of home ownership there would be a heavy price to pay. Congress set up processes (Research the Community Redevelopment Act) whereby community activist groups and organizers could effectively stop a bank’s efforts to grow if that bank didn’t make loans to unqualified borrowers. Enter, stage left, the “subprime” mortgage. These lenders knew that a very high percentage of these loans would turn to garbage – but it was a price that had to be paid if the bank was to expand and grow. We should note that among the community groups browbeating banks into making these bad loans was an outfit called ACORN. There is one certain presidential candidate that did a lot of community organizing for ACORN. I won’t mention his name so as to avoid politicizing this column.

These garbage loans to unqualified borrowers were then bundled up and sold. The expectation was that the loans would be eventually paid off when rising home values led some borrowers to access their equity through re-financing and others to sell and move on up the ladder. Oops.

Right now this crisis is being sold to the American public by the left as evidence the failure of the free market and capitalism. Not so. What we’re seeing is the inevitable result of political interference in free market economics. Acme bank didn’t want to loan money to Joe Homebuyer because Joe had a spotty job history, owed too much money on his credit cards, and wasn’t all that good at making payments on time. The politicians told Acme Bank to figure out a way to make that loan, because, after all, Joe is a bona-fide minority-American, or forget about opening that new branch office on the Southside. The loan was made under politicial pressure; the loan, with millions like it, failed – and now we are left to enjoy today’s headlines.

So … why aren’t you reading the whole story in the mainstream media? Come on, are you kidding me? Do you really expect the media to blame this mess on deadbeat borrowers and political interference in the free market when it is so easy to put the blame on greedy lenders and evil capitalists? Remember … there’s an election going on. One candidate is decidedly anti-capitalist. Do the math.

I'm doing the math, Neal. I'm seeing an economy in the red. I'm seeing mortgage brokers selling loans to anybody and everybody with NINJA loan crap for years because there was no regulation and wall street looked the other way. And yes, as long as housing prices went up these companies made hundreds of billions.

But if you actually think that Wall Street was forced to make loans to people who couldn't pay by Democrats, you really are a complete moron.

No offense.

But it sure is a great excuse to blame anytbody but the GOP, the Wall Street titans getting golden parachutes and the companies that frittered away trillions of YOUR mortgage dollars in bad investments and then are taking that money BACK in turn from the American taxpayers all over again. It sure is a great excuse to blame black America for Wall Street's shitty investments. It's not like those mortgage brokers preyed on people by hiding the fine print and taking advantage of them. They got paid to do so. It was institutionalized fraud against millions of poor Americans of ALL races.

And you're telling me Lehman Brothers is the victim here?

Fuck you, Neal Boortz. Fuck you and your entire racist bullshit.

You do the math.