In this segment of McCuistion, host Dennis McCuistion is joined by a panel of experts:
- Stan Liebowitz, PhD., author of Anatomy of A Train Wreck & Director for the Analysis of Property Rights and Settlement
- Richard Bitner, author of Confessions of a Subprime Lender and Associate Publisher for Housing Wire Magazine
- Robert Higgs, author of Crisis and Leviathan and Senior Fellow in Political Economy at The Independent Institute
Unemployment is rising, stocks have fallen 35%, every area of industry is challenged, credit is tight, foreclosures are on the rise, and no-one admits responsibility. This program explores the greed, fraud and incompetence in all areas of business and government. It asks if the remedies being applied by the Treasury and the Federal Reserve System (Fed) are the right ones and if, in fact, those in charge have any idea what they are doing to America’s economic future.
Experts point toward the mortgage industry and Wall Street as the source of the recession we’re in today and explain how the recession actually started. Approximately 30-40 years ago getting a loan consisted of one loan recipient going to his or her local bank and completing the entire transaction through that one bank. With the introduction and growth of securitization, which in itself isn’t a bad thing, a new era of issues were created.
In the early 1990s in an effort to get more Americans into homes, the Fed lowered lending standards to increase home ownership. People no longer had to have verifiable income, strong credit history, and more. This caused the demand for houses to go up and the prices of those houses increased right along with it. The panelists further explain the types of decisions and misinformation that took place during this time that led to the mishandling of the situation.
The experts cover the role investment banks have played, look critically at Wall Street and rating agencies, and examine the issues surrounding both entities decisions and actions.
02.08.09 – 1722