Quote from: 21after2 on January 24, 2013, 11:50:32 PM

Quote from: hazek on January 24, 2013, 11:33:20 PM

Quote from: 21after2 on January 24, 2013, 11:25:30 PM

Quote from: iCEBREAKER on January 24, 2013, 11:14:05 PM

Quote from: Monster Tent on January 24, 2013, 11:08:30 PM

Bitcoin and unregulated financial markets just leads to massive scamming.

Unlike our heavily over-regulated fiat trash based financial markets. Oh wait, S&L crisis, dotcom bubble/crash, housing bubble/crash, bond bubble/crash.

And Madoff, plus MF Global and LIBOR, etc. etc. etc.

Can't you go be a blithering statist in some other thread? Cheesy

Not really in anyone's defense here, but the housing bubble crash was caused due to a lack in regulation rather than over-regulation. A lot of people at a lot of banks and firms were doing things that should have never been allowed even if just viewed from a common sense perspective.

Not that I'm a bank lover, but I wouldn't give (at least) the housing bubble to the over-regulation side.

Not true at all. That bubble happened precisely because of regulation. Banks were practically forced to lower lending standards by Freddie and Fannie, not to mention the FED key interest rate affected mortgage rates to get artificially low enabling many to borrow who couldn't afford it. All Wall Street did was feed upon this circle and meet a demand that was created by the government and no one else. It's called moral hazard, look it up.

It had more to do with risky and (quite frankly) idiotic investment practices due to deregulation in commercial and investment banking through the eighties and nineties (Graham-Leach-Bliley, MCA, and Garn-St. Germain in particular). Banks were lending to people who should not have been eligible for borrowing, and their mortgages were combined and shifted around into so many different convoluted securities and investments that no one truly knew the extent of what they were investing in.

The banks setting lower standards weren't doing it because they were victims. They were doing it to get what they could out of the loans before they passed it off to be someone else's problem. There's only so far you can pass the buck before it crumbles.

What astounds me most about the whole property bubble and subsequent credit crisis and 'stepping in' of the authorities leading to the mess we're in today is that people looking at the same facts can come to such diametrically opposed opinions as to its underlying causes.

As a Brit I read up on and watched some programmes about what happened with the RBS, the brink of collapse of which was one of the triggers to the bank bailout. I can see that they were making irresponsible decisions and I can see why the 'obvious' answer is therefore to make rules that force them to act responsibly. If rules that were not in place would have stopped them it follows they must have been 'too deregulated' and should be regulated more.

However that ignores the bigger picture, namely the amazing and astounding history of Freddie and Fannie from the 70s and the knock on effects. My oversimplified understanding of it is of the way in which those government-set-up institutions got used to force lenders to lend irresponsibly to fulfill political agendas. This then lead to masses of sub-prime mortgages no lenders wanted which is how the ludicrously huge figures were lent with virtually no chance of their ever being repaid. Sure the private banks jumped on the bandwagon but the bulk of the time-bomb debts as I understand it came into existence as a direct consequence the heavy arm of politics in finance. Add into the mix the banks' plucking of loans out of thin air and states' monopoly on currency and money supply and we end up with the lethal concoction that brought us to our knees. And from what I understand the combination of QE with popular support for tying the banks up in even more regulation we're far from out from the forest yet.

Then along comes the knight in shining armour called Bitcoin...