Secondary Research: Individual / Munazza Aijaz

  1. “What happened to all those foreclosed homes?” by Adriene Hill.
  • The number of foreclosures has fallen since the recession, but the number of homes actually owned by the families that occupy them has not gone up. They’re at some of their lowest rates in 25 years
  • Foreclosed homes were taken up by investors and hedge funds who then rented them out
  • There are 12 million single family homes in the rental stock
  • Housing market has recovered, housing finance hasn’t

Thesis: The article skims over the actual financial crisis, but stresses that previously foreclosed homes have been taken up by investors to be rented out to people.

Hill, Adriene. “What happened to all those foreclosed homes?” Marketplace, Marketplace, 8 Mar. 2016.

2.“How the housing crisis left us more racially segregated” by Emily Badger

  • 10 million families lost their homes to foreclosures
  • The financial crisis also resulted in many migrations because families had to move when their homes were foreclosed
  •  Reversed recent progress that America has made on racial integration
  • Minorities were hit very hard by foreclosures
  • “Minorities who lost their homes moved to more distressed neighborhoods, while white homeowners who could leave appear to have been the first to pull out of places hit by foreclosure.”
  • As time passed, this pattern made neighborhoods more segregated than before the crisis
  • Foreclosure rates during the crisis were highest in the most racially integrated places
  • “The 10 million households that lost their homes dwarf the number that left the Great Plains during the Dust Bowl (that was about 2.5 million people).”

Thesis: The article brings to attention the migrations that occured during the 2007-2008 financial crisis. It argues that the crisis made America more segregated than it had been directly before the housing bubble popped.

Badger, Emily. “How the housing crisis left us more racially segregated.” The Washington Post, WP Company, 8 May 2015.

3. “Picturing the Crisis” by Paul Reyes.

Thesis: Photographing the crisis was a challenge, but people accomplished it in different ways. The article then goes on to list several photo series and explains each concept.

Reyes, Paul. “Picturing the Crisis.” The New York Times, The New York Times, 12 Oct. 2010.

Synthesis: My secondary research helped to give me a more in depth idea of how foreclosures were a part of the financial collapse, and how they still impact us today. After the crisis, previously foreclosed homes were not purchased at the same rate that homes were before the bust. Instead, most of them became rentals. Families that were forced to leave their homes because of foreclosures did so in certain patterns, creating more racial segregation than what was present directly before the crash. It was interesting to see the eerie photographs of foreclosed homes. I now have a deeper sense of what  role foreclosures played in the crisis. The effects from foreclosures are lasting.

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.