Senate Subprime Bill: $25B to Business, $3B to people losing their homes

Boy oh boy is this sad, AP reports on the bill expected to pass the Senate:

A measure billed as boosting the slumping housing market showers money-losing businesses with $25 billion in tax relief in the next few years but offers just $3 billion to homeowners.

The estimates released Thursday by congressional scorekeepers lend credence to accusations that the measure helps businesses like home builders while doing little to help millions of families threatened with foreclosure.

The benefits to businesses also dwarf the $4 billion in the measure that would be provided to cities and towns to buy up and refurbish foreclosed and abandoned homes. The only direct help in the measure to homeowners threatened with foreclosure is $100 million to provide counseling to people threatened with foreclosure and help them in negotiating with their lenders.

Origins of Subprime crisis: derivatives

Subprime Crisis & Derivatives: Origins

by niccolo caldararo

The origins of the present subprime crisis can be found in the Nixon Administration when his appointment to the SEC, Mitchell, removed the prohibitions to trades in futures and similar "bets" that has made our markets so unstable.   A number of academics including Fisher Black, created a series of formulas by which traders could manipulate the markets and make huge profits. The result of this behavior would led to our crisis by creating the impression that risk could be eliminated.

Obama and Subprime

While the political cheering leading goes on, you might want to read these two articles:

Subprime Obama

There's been less emphasis from the Obama campaign on the really dysfunctional role of the financial industry in the subprime mess," says Josh Bivens of the Economic Policy Institute. "Edwards and Clinton talk much more about regulation of the financial industry going forward, and to the extent that blame is placed, they tend to place it on the lenders for steering people into loans they couldn't afford.