Wednesday, May 25, 2011

Responsibility and character: Active sculpting of reckless mindset

Here is a quote from Gretchen Morgenson, a New York Times reporter on her recent NPR interview regarding the reckless behaviors of Fannie Mae that provide a template for reckless behaviors later on Wall Street.

"If you had had regulators doing their job, and if you had had a tough overseer of Fannie Mae who made it increase its capital, who made the company take greater care with some of its loans that it - that it guaranteed or bought, then you wouldn't have had this problem. So you can't lay it simply at the feet of Fannie Mae, but you have to throw in all of these other characters that were acting in their own interests.

It wasn't about the homeowner. It wasn't about expanding home ownership so that immigrants could, you know, build a nest egg for their children, because the kinds of loans these immigrants were given had absolutely no ability to build a nest egg. They were so punishing in their terms, that there was no way the immigrant could possibly pay them off.

So it was an idea, but the execution - the idea was OK. The execution was disastrous. And it was because there were so many self-interested people at the trough."

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