stop talking like I'm absolving personal responsibility
you are looking at things from such a small and narrow view. this isn't even just about ppl that can't afford these loans its about EVERYONE. even the ppl that are paying these loans....
the money is coming from a private company charging interest to banks and to us then taking the money back to private owners.
how is that fair and just?
then...when they fukk up THEY get the bail outs and everyone else is told to fukk off
how is that fair and just?
Banks are federally protected which is why they should be properly regulated. And what you explaining is how lending typically works, since the days of goldsmiths of Europe providing receipts to the wealthy for their deposits. And interest rates correlate to inflation.
There were once caps on interest rates that would regulate finance. From my understanding, if the Fed hiked rates to the legal limits, the system would stop. After interest-rate decontrol, buyers and borrowers are willing to pay anything(people for the most part are ignorant, greedy, gullible or desperate) but
investors would refuse to provide more money as they know their returns were artificially depressed by government caps/interest limits. So an investor who has money in a regulated account drawing little interest, would move their money to another one, unregulated with a higher return. As the Fed heightened interest rates and the restricted money supply, thousands of investors withdrew money and shut down the system taking money from savings and loans (literally many making a run on the bank and transferring money offshore). Savings and loans can't make new mortgages so the housing industry is hemmed up and shuts down.
All this can be avoided if banks provided loans based on credit worthiness instead of finagling stuff like stated-income loans that were not properly underwritten in replace of Qualified Mortgages and The Ability to Repay loans in addition to other reforms. We will see what the Trump administration does but looks like a Republican-ran Congress is going to de-regulate which is why stocks are shooting up.
