Blue and red road leads to ruin

The financial road Americans are on seems familiar, and both of our political parties are culpable.

When President Bill Clinton repealed the 1933 Glass-steagall Act in 1999, he activated a time bomb that a housing bubble. During the Great Depression and 66 years after that, Glass-steagall kept investment banks and commercial banks apart.

After the abrogation of the act, banking greed took less than a decade to cause America’s housing and financial markets to crash.

President George W. Bush stuck his head in the sand until the Great Recession. And his administration helped facilitate the crash. In 2003, it encouraged every American to own a home but turned a blind eye to banking fraud occurring.

Mortgage bankers originated of the loans they made, but they would immediately package them up and sell them on Wall Street. With no risk or oversight, unscrupulous bankers ignored the guidelines for typical credit qualification and produced millions of fraudulent loans.

All you had to do was fog a mirror to qualify for a home, and many people rushed into the market as housing prices soared. Home values more than doubled during Bush’s term in office, when the average appreciation was 3-5% percent per year.

The only thing the financial markets learned from the experience was that they were too big to fail. The government learned a lesson as well. Money was printed and thrown at any problem without regard to inflationary pressure. Now, here we are 15 years later and doing it again.

Michael Miner, Henderson