And so it’s Fred’s fault that a bunch of corrupt bankers and politicians played the system, eh?
Are you trying to suggest that working to pass a law is equivalent to breaking it?
[does not compute]
I remember when the savings and loans collapsed. Your post also reminds me of the Keating Five and John McCain’s involvement.
***The Keating Five (or Keating Five Scandal) refers to a Congressional scandal related to the collapse of most of the Savings and Loan institutions in the United States in the late 1980s. McCain was one of five senators who met at least twice in 1987 with Ed Gray, chairman of the Federal Home Loan Bank Board, seeking to prevent the government’s seizure of Lincoln Savings and Loan, a subsidiary of Charles H. Keating’s American Continental Corporation. Between 1982–1987, McCain received approximately $112,000 in political contributions from Keating and his associates. In addition, McCain’s wife and her father had invested $359,100 in a Keating shopping center in April 1986, a year before McCain met with the regulators. McCain, his family and baby-sitter made at least nine trips at Keating’s expense, sometimes aboard the American Continental jet. After learning Keating was in trouble over Lincoln, McCain paid for the air trips totalling $13,433.[47] Federal regulators ultimately filed a $1.1 billion civil racketeering and fraud suit against Keating, accusing him of siphoning Lincoln’s deposits to his family and into political campaigns. McCain received a rebuke from the Ethics Committee for exercising poor judgment for intervening with the federal regulators on behalf of Keating. On his Keating Five experience, McCain said: “The appearance of it was wrong. It’s a wrong appearance when a group of senators appear in a meeting with a group of regulators, because it conveys the impression of undue and improper influence. And it was the wrong thing to do.”***
http://en.wikipedia.org/wiki/John_McCain#Keating_Five_controversy
What was the point of your post? Were you praising Thompson for his efforts to avoid the $8.5 House bill in favor of the no-cost Senate bill?
THRIFT UNIT AID BACKED BY SENATE
KENNETH B. NOBLE, Special to the New York Times. New York Times. (Late Edition (East Coast)). New York, N.Y.: Sep 25, 1982. pg. 1.39
(snip)
The Senate bill, sponsored by Jake Garn, Republican of Utah, chairman of the Banking Committee, would make available Governmentguaranteed promissory notes to bolster the net worth of faltering savings and loan associations and mutual savings banks.
In effect, if a thrift institution’s net worth - the amount by which assets exceed liabilities - fell below a certain level, the Government would add to the institution’s assets by authorizing Federal regulators to provide income-capital certificates, a kind of interest-bearing promissory note already being used by the Federal Home Loan Bank Board to bolster ailing savings and loan associations.
The Senate proposal would require no direct Government appropriations because the certificates are backed by money that already exists in the Federal depository insuring agencies. The House version, on the other hand, would require the appropriation of $8.5 billion to back the notes in case they were cashed.
The need to bolster the assets of thrift institutions results from months of high interest rates that have made the cost of deposits higher than the income the thrift institutions earn from their portfolios, which are dominated by long-term mortgages and bonds with relatively low yields.
The Senate bill, called the Depository Institutions Amendments of 1982, directs Federal regulators, in the form of the Depository Institutions Deregulation Commmittee, to create a new instrument for banks and thrift institutions intended to be competitive with money market funds.