Subprime crisis explained !

[gregpet]

Riders who decides what is the proper level of income for a family? Maybe the paycheck is enough to live on but they just want more. Could this be the case? Is it mandatory to have a cell phone, computer, quad, skis, etc... you name it. Are some living beyond their means and crying that their paychecks are not enough to live off now?

[riders2010]

Good points fjlp, where would heidi be if she didn't grant the credit though? where would all the businesses be that need the so called drunks to have money be without the credit? The credit just extended the businesses a little bit further, the big crash would have come anyway right?
So the credit as I said was not the cause it was a sideshow scam masking the and extending the problems.

Too much money is being taken by the rich from the middle class.

I wonder how many Canadians that have both people working in their families say that they cannot make ends meet, or are just barely making ends meet?

That example is kinda offensive because it implies all people out of work or not able to pay the bills are like drunks and that is not the case for most people, "the middle class"

[riders2010]

Greg that implies that the people are the problem and for some that is true, but trust me I know that is not the case for most. And if the economy is affected as greatly as it is by this then it involves alot more than just the drunks don't you think? Look at household debt levels?
Lots of other factors such as free trade deals with countries that pay their people pennies an hour. Who does that really benefit?

[bucket]

How about another scenario.

Joe farmer decides to sell his crop to the cwb. Cwb pays him 4.00 a bushel and the cwb sells the bushel for over ten bucks. Gets paid because the cwb doesn't have credit sales anymore. Cwb needs more grain and calls for another 25 percent. Pays joe farmer 4.00 a bushel and sells the grain for 10.00 a bushel. Remainder of the crop that joe has in the bin is at his risk. The cwb goes to the MGEX and plays the market with the spread money that he owes Joe Farmer.

Cwb loses 250 million in discretionary trading. Joe doesn't get the average price, he gets another buck a bushel and fifty percent of his contracted grain is in his bin that the cwb never calls in.

Next year comes and Joe contracts his new grain and the remainder left in his bin to the cwb. The cwb does the same thing but they lower the price. They need to re coup the 250 million they lost.

Zero risk to the cwb but they risk everything to play the market. They have no business in the futures market the way they buy and sell grain.

Unfortunately, experts and farmers alike believe they do to protect the farmers interest.

Its all bullshit, which is why the cwb has to go.

Two questions for everyone:

1. Why does the cwb need to manage risk when they have none? Zero.

2. Why does this not look like every other ponzi scheme?

[wd9]

Watch the movie "Inside Job", 2010