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Originally Posted by flatsixes
I'll let all you economics majors argue over who shot John (the butler did it). But I'm more than a bit appalled at the license that the author of the opinion piece took with Mayor Bloomberg's statement. I don't necessarily disagree with the author's facts (once they're stripped of the author's unnecessary hyperbole). But the author tees-off on Bloomberg by opening with this:
The Big Lie made a surprise appearance Tuesday when New York Mayor Michael Bloomberg, responding to a question about Occupy Wall Street, stunned observers by exonerating Wall Street: ***8220;It was not the banks that created the mortgage crisis. It was, plain and simple, Congress who forced everybody to go and give mortgages to people who were on the cusp.***8221; That's "The Big Lie?" that supports the author's accusations of a rewrite of history by "Wall Street" (whoever that is). Then why is this "rewrite" buried in the last few lines of the piece?
Bloomberg was partially correct: Congress did radically deregulate the financial sector, doing away with many of the protections that had worked for decades. Congress allowed Wall Street to self-regulate, and the Fed the turned a blind eye to bank abuses. Oh! So Bloomberg was not lying? Well then, never mind.
If you can't make you points (and good ones) without resorting to the lamest form of fallacy (straw man), then I've got no more time to waste on you, Mr. Ritholtz. Get an adult to help you with your next column. |
Respectfully, I think you've misunderstood his point completely. "The Big Lie" that he mentions is defined as "that banks and investment houses are merely victims of the crash." Bloomberg
did repeat that, and it is a lie that the crisis could be blamed in whole or large part on excessive government regulation - i.e.
forcing banks to make loans.
When he said Bloomberg was partially right, he meant that it's correct to blame Congress. Blame them not for "forcing banks to make loans" (the motivation to make poor loans was being able to turn around and immediately sell them to securitizers, not any heavy handed federal mandate to make loans that would drive a bank out of business) and excessive regulation, but blame them for radical deregulation and ignoring the ticking timebomb of imprudent lending and allowing the things mentioned in the bullet points - repealing Glass Steagall, allowing excessive leverage, no regulation of derivatives, little to no oversight of the methodology of the ratings agencies, etc.
I see no "straw mans" there.