Reading Response 1 / Emma FitzGerald

“Wall Street and the Financial Crisis: Anatomy of a Financial Collapse,” is an depth report done by the US Senate released in 2011. They touched on four major areas of concern that lead to the failure of the financial system: high risk mortgage lending, failure of regulators to stop such practices, inflated credit ratings, and abuses of the system by investment banks. They primarily blame two sides of the collapse, blaming both the large institutions such as Washington Mutual, an aggressive mortgage lender the collapsed during the crisis. They added an in depth view of the corruption that was going on behind closed doors. While also placing blame on loose government regulations by groups such as the Office of Thrift Supervision. This document also included 19 recommendations for changes to regulatory and industry practices.

The second article, “The 2008 Housing Crisis” takes a defensive stance on the issue, explaining why the federal government and the Federal housing programs are not to blame.  Conservatives try to place blame on the government programs enacted after the Great Depression, such as Federal Housing Administration, or FHA; eliminating the Community Reinvestment Act, or CRA. But there is a lot of evidence this isn’t true. These programs were put in place to bring stability to the national housing market, and with Federal support for the mortgage market, homeownership blossomed. FHA loans were safer and performed better over time compared to the subprime loans. Many times brokers would push their clients into these loans for a quick sale. These loans often came from private mortgage lending groups and they were notorious for predatory lending and poor regulation, which ultimately was the true cause of the 2008 financial crisis.

Before reading these articles, I didn’t have a good grasp on the subject, and did some additional research to put things in context. While searching I found a great infographic on Co.Design’s website about the effects on our country between the year of the collapse, 2007, and 2010. The infographic shows the change in a variety of things such as “Daily Consumer Spending” to “Approval Ratings of Obama”.

That infographic was made 4 years ago, and second article was written earlier this year. It’s crazy to think we still need to people to understand the main cause of this crisis, and long lasting effects of the recession. After reading the two articles it has become clear that selfishness and greed play a huge role in the financial crisis. The rich just wanted to get richer and were targeting groups who were vulnerable, and things were working out for awhile, but there were cracks in the foundation, then everything came crashing down. In our country’s current political state, it is important that we stay educated on the subject, and make sure we don’t let his happen again.

Secondary Research/Zoe Storch

  • A plan written in 2005 to begin the regrowth and renovation of businesses and residential areas in the Camp Washington area
  • “Camp Washington NBD was once seen as a strong business community, the center of commerce for the industrial and residential communities. More recently, Camp Washington NBD has been perceived as an economically viable area for reinvestment.” (2)
  • Would be an interesting followup to see if these goals were achieved
  • Useful history about the area and what major projects have occurred over the years

Thesis: Two years before the financial crash of 2007, Camp Washington developed a multi year redevelopment and market feasibility plan. Comparing their goals with today’s redevelopment, Camp Washington hasn’t been able to achieve all of the benchmarks they set for themselves.

  • News segment about plans to renovate areas of Camp Washington today
  • Still trying to get funding and renovations under way (all still speculative)
  • Rhinegeist wants to put medical marijuana plant (needs to win bid)
  • Crosley Building Renovation (radio building to housing)

Thesis: As of July 2017, there are many speculative renovations and bids on Camp Washington area buildings to turn them into businesses and housing which points at population growth and economic upturn.

  • Comprehensive study that covers changes between 2005-2009 of many major social and economic conditions in Cincinnati neighborhoods
  • “Among the working class white Appalachian areas Camp Washington, South Fairmount, the East End, and Lower Price Hill saw improvements in the 2000 to 2005-2009 period.” (43)
  • P 59- drop out rates increase 14.5% from 2000-2009
  • P 88- Unemployment rates increase 2% from 2000-2009
  • Joblessness rates increase 1% from 2000-2009

Thesis: Taking data from multiple charts in this study, there is a small but significant increase in both drop out and unemployment rates in the Camp Washington area. These correspond to the 2007 financial crash. Although the area was slightly affected by this economic change, there’s not enough data to support a large financial downturn due to it.

Synthesis: Looking at these three documents, it’s unclear if some of the financial downturn Camp Washington has experienced post 2007 is due fully to the crash or if other factors affected it. Currently, there are a few Camp Washington area organizations that are working to renovate and redevelop with the help of investors and local area businesses (which is a good sign that money is being put into the area). Overall, it seems like the financial crash slightly affected the business district of Camp Washington, but 10 years later, they are still creating jobs and income for the area with new renovation projects.