Federal inquiry finds that financial meltdown was 'avoidable'
That's not really news. A lot could have been done - a lot - by both government and banks to prevent the financial mess we find ourselves in today.
But to see it in black and white, along with abandoning the silly notion that it was all Bush's fault, might give some impetus for meaningful reforms. The big banks today are even bigger than they were when the crisis occurred thus making us even more vulnerable to their greed and ineptitude.
New York Times:
The commission that investigated the crisis casts a wide net of blame, faulting two administrations, the Federal Reserve and other regulators for permitting a calamitous concoction: shoddy mortgage lending, the excessive packaging and sale of loans to investors and risky bets on securities backed by the loans.
"The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done," the panel wrote in the report's conclusions, which were read by The New York Times. "If we accept this notion, it will happen again."
While the panel, the Financial Crisis Inquiry Commission, accuses several financial institutions of greed, ineptitude or both, some of its gravest conclusions concern government failings, with embarrassing implications for both parties. But the panel was itself divided along partisan lines, which could blunt the impact of its findings.
Many of the conclusions have been widely described, but the synthesis of interviews, documents and testimony, along with its government imprimatur, give the report - to be released on Thursday as a 576-page book - a conclusive sweep and authority.
You may recall the Democrats telling us that the FinReg bill would make it impossible for banks to be "too big to fail" ever again. Nobody believed it then and this inquiry apparently proves it a lie.
Despite a slowly improving economy, it could all fall apart again with another shock to the system. If that happens, the taxpayers will be left holding the bag.