Once upon a time, American financial institutions
actually examined the credit-worthiness of those who came seeking
loans. People who had little income, little prior credit history,
and/or unsatisfactory experience with previous credit usage were denied
loans or, in marginal cases, perhaps granted a loan but at higher
levels of interest to compensate for the increased risk of default they
A significant percentage of those refused credit in some areas of the
country were black. This was because a higher proportion of blacks —
for whatever reasons — in those areas had low incomes, lived on
welfare, or had other characteristics representative of those who might
fail to repay a loan.
Then along came Big Brother who sternly declared that financial organizations were...dum-de-dum!
Don’t you dare “red-line” certain districts! Don’t you dare refuse a
greater percentage of loans to blacks than other racial groups! Don’t
you dare make loan decisions based on long-established actuarial
information! RACIST! RACIST! RACIST!
Properly chastised, banks and such began fulfilling the racial quotas
for loans that BB had determined they should follow. Low and behold!
Affirmative action for credit! Lower income black people buying houses!
Yeah! Racism abolished! Greedy bastard bankers punished!
In its magnificent munificence, Big Brother decided to hurt help
everyone in the country by reducing interest rates to levels so low
that huge new groups of people decided they wanted in on the action. In
pay for all their warmongering and massive new socialistic welfare programs
ensure that even more folks got
assisted in fulfilling their dreams, BB cranked up both the literal and
figurative printing presses, spewing incredible amounts of unbacked
currency into the national and worldwide economies. Inflation
frakked over Americans traveling aboard
made it easier for foreigners to buy our goods and services. Financial
institutions drowned in overwhelming piles of credit they sought to
dole out to anyone who shoved a greasy palm in their general direction.
No down payment mortgages! Interest-only loans! Adjustable rate
mortgages! Fifty-year loans! Invest! Flip! Sell! Make a killing!
Woo-hoo! A good time in the ol’ town tonight!
Oh, no! Oil prices soar! (No relationship to our troops blowing up the
Mideast, of course...) The purchasing power of the dollar plummets! (No
doubt the fault of nasty, obnoxious business owners...) Mortgage
defaults soar! (Bastard banks...) Crisis! Crisis! Crisis!
Whoop-whoop-whoop! Alarm! Alarm! Alarm!
It’s the fault of the financial institutions! Those predatory demons!
Preying on poor people! Preying on poor black people! Racists! Giving
people loans the lenders had
to have known the innocent,
ignorant slobs could never pay back. Big Brother must rescue them!
Guarantee more loans! Increase inflation even more by lowering interest
rates! Print more money! Create more credit! It’ll help this time! It
Fool me once, shame on you. Fool me twice, shame on me...
(from Don't Get Me Started!