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Moreno Valley had the misfortune to swell at a time of lax lending practices.
Analysts say this system has also encouraged lax lending standards and may have fed asset bubbles.
Banks also face a reckoning for their lax lending standards during the mortgage bubble.
The use of mortgage insurance during the boom effectively encouraged lax lending.
China's state banks are under orders to tighten up horribly lax lending habits.
Loans are harder to get because lax lending standards have been tightened.
But his housing policies and hands-off approach to regulation encouraged lax lending standards.
What alarms them is an "assignee liability" provision that would hold them partly responsible for lax lending by originators.
When consumers borrow beyond their means, the blame is laid on lax lending practices rather than irresponsible borrowing.
The subprime-mortgage crisis of 2008 had exposed lax lending standards throughout the banking industry and credit was tight.
Similar(1)
"If loose money [lax lending] is causing the liquidity surplus, then both economic growth and the bull rally are resting on thin ice".
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