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Lenders provided lavish, even excessive, financing based on unrealistic expectations of rising rents.
Compared with previous boom-and-bust cycles, the last one was nothing new, in that excessive financing and combined to drive the market to dizzy, unsustainable heights.
Particularly in the United States, the crisis was characterized by growing securitization of non-performing assets, large fiscal deficits, and excessive financing in the housing sector.
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It seems to be a common theme in this country, especially as our economy is only gradually emerging from a period of nationwide deleveraging that is achieved through lower spending and hence lower economic growth, and especially when that lower growth is compared with previous periods in which economic growth was significantly abetted by excessive debt financing all around.
In the 1990s, they grew on the backs of excessive debt financing, options-charged executives and capital-appreciation happy investors.
Additional costs should be no more than another 0.3% for big companies, suggesting a fair fee is 0.6% and that anything more than 1% is excessive, Fairer Finance claimed.
As a working scientist, I believe that excessive competition for financing is one reason that research productivity is declining in the United States.
Both political parties share culpability for allowing parts of the financial sector to take excessive risk while financing themselves with a great deal of debt and relatively little equity.
These include the weakening of the industrial base, a neglected infrastructure, the dependence on public and private debt, the lunatic housing market, the excessive strength of finance.
In Europe, the conflict has already erupted on the streets, with workers demanding that generous retirement policies be kept while governments press to pare pensions and raise retirement ages because taxpayers cannot bear any additional weight and creditors will no longer finance excessive borrowing.
"The attitude toward the protection of parenthood and childhood has to change drastically on every level," the resolution said, citing excessive bureaucracy, lack of financing for children's medical care and insufficient efforts to promote adoption.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com