I touched on this topic a couple of days ago, but I think it deserves more attention.
In 2006 Donald Trump said he “sort of hoped” the housing market would collapse. If there is a bubble burst “people like me can go in and buy like crazy.”
Two years later the real estate bubble did burst. It was the equivalent of a sink hole in the U.S. economy. The poor were largely unaffected, because they didn’t have anything to lose, but the rich got richer— at the expense of the middle class.
- Home values plummeted.
- Stocks tanked.
- Retirement savings were halved.
- 529 college savings plans virtually disappeared.
- “Upside down mortgage” became a common phrase: The drastic drop in housing prices, resulted in people owing more on their mortgages than the homes value. Many of those homes went on to foreclose, further bringing down real estate values.
- Property taxes rose at alarming rates in order to compensate for lost tax revenue of foreclosed homes. This too led to more foreclosures, because people could no longer afford their property taxes.
People like Donald Trump purchased foreclosed real estate at a fraction of it’s true value.
Banks were bailed out of their self inflicted crisis, first by G.W. Bush, and then again by President Obama. Bank CEO’s used bail out money to reward themselves with hundreds of millions of dollars in bonuses. Oh yes, they did.
Relief finally came in the form of regulations, put in place to ensure this kind of a financial crisis could not happen again. The Dodd–Frank Wall Street Reform and Consumer Protection Act prevents, among other abuses, predatory lending.
Despite what Donald Trump’s triumphant tweet implys, he waging war on the middle class. When you take off that red “MAGA” hat you’ll be able to see this clearly. On June 8, 2017, the Republican-led House passed the massive, 600-page Financial CHOICE Act, which if enacted, would repeal Dodd–Frank. The Financial CHOICE Act is now in the hands of the senate.
Donald Trump is attempting to deregulate banks, and trying to say this is good for America. This is good for the top 1% of Americans, but this is not good for the middle class. Another financial collapse is a foregone conclusion without regulations in place to keep banks and lenders in check. They have proven they can not be trusted to self-regulate.
2008-2009 saw the biggest re-distribution of wealth since the Great Depression. Enough is enough. Call your Senators and tell them not to deregulate America’s banks.