Posted on 09/24/2008 5:05:45 AM PDT by XHogPilot
HOW did America wind up in its worst financial crisis in decades? Sen. Barack Obama explained it this way last week: "When sub-prime-mortgage lending took a reckless and unsustainable turn, a patchwork of regulators systematically and deliberately eliminated the regulations protecting the American people." That's exactly backward. Mortgage lending took that "reckless and unsustainable turn" because of regulation - regulation driven by liberals and progressives, not free-market "deregulators." Pushed hard by politicians and community activists, the regulators systematically and deliberately altered financially sound lending practices. The mortgage market was humming along just fine when, in the late 1980s, progressives decided that it needed to be "fixed." Their complaint: Some ethnic groups got approved for mortgages at lower rates than others. In reality, mortgage lenders were simply being prudent - taking care to provide mortgages to those who could best afford to make the payments. The shift began in 1989, when Congress amended the Home Mortgage Disclosure Act to force banks to collect racial data on mortgage applicants. By 1991, critics were using that data to paint lenders as racist by showing that minority applicants were approved at far lower rates. Banks were "Shamed By Publicity," as one 1993 New York Times headline put it. In fact, they found a racial disparity only by ignoring relevant data on applicants' ability to make mortgage payments - such as their assets and credit history. But the political pressure was intense - with few in politics or media eager to speak the truth. And then, in 1992, came a study from four researchers at the Boston Fed, which seemed to bear out the critics' contentions. That study was, in fact, based on quite flawed data - but the authors' political, media and academic protectors stifled most serious criticism, smearing the reputation of one whistleblower
(Excerpt) Read more at nypost.com ...
"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelologus
Absolutely true, although I do believe more of the blame lay at the feet of the Dems, but it doesn't much matter now. The only comfort I find in all of this is that even the liberal press is going to feel the pain if/when it really hits the fan.
Coincidentally, my husband had I just last week had a meeting with our financial adviser that was scheduled well in advance of the latest mess. Fortunately our bottom line looked good—at the moment anyway. I came right out and asked him if the worst case scenario plays out (and he certainly didn't rule that out), what should we do. And he looked us in the eye and in a very somber tone of voice he said “stick together”.
The best we as individuals can do now is to get out of debt as much as possible and hang on because its going to be a bumpy ride.
Do you have more details? I didn't see it.
Communist Redistribution Act
Let's say they did and hypothetically I was Barack Obama. I might say "John McCain wants to blame this crisis on poor black folk, people who have nothing and just wanted to live the american dream! Those people were lined up and exploited by the bankers who then took their homes and now are asking for billions in bailouts to make sure they get to keep their mansions! And McCain blames the black guy?"
The template is, if McCain points to increases in unqualified loans, he's a racist. Ridiculous but do you honestly think Obama and the press won't pounce on that line of thought?
Now, why he won't point to his efforts in 2005 to reign in Freddie Mac and Fannie Mae (which were stymied by dems) I don't know. It would go a long way to making him look prescient while making dems look like partison hacks looking to line their pockets. But I guess he must want to retain collegial relations with his friends in the Senate so he won't blame them for anything. Nothing else makes sense.
B-U-M-P everyone’s accusing me
HOW did America wind up in its worst financial crisis in decades? Sen. Barack Obama explained it this way last week: "When sub-prime-mortgage lending took a reckless and unsustainable turn, a patchwork of regulators systematically and deliberately eliminated the regulations protecting the American people."
That's exactly backward. Mortgage lending took that "reckless and unsustainable turn" because of regulation - regulation driven by liberals and progressives, not free-market "deregulators."
Pushed hard by politicians and community activists, the regulators systematically and deliberately altered financially sound lending practices.
The mortgage market was humming along just fine when, in the late 1980s, progressives decided that it needed to be "fixed." Their complaint: Some ethnic groups got approved for mortgages at lower rates than others.
In reality, mortgage lenders were simply being prudent - taking care to provide mortgages to those who could best afford to make the payments.
The shift began in 1989, when Congress amended the Home Mortgage Disclosure Act to force banks to collect racial data on mortgage applicants. By 1991, critics were using that data to paint lenders as racist by showing that minority applicants were approved at far lower rates. Banks were "Shamed By Publicity," as one 1993 New York Times headline put it.
In fact, they found a racial disparity only by ignoring relevant data on applicants' ability to make mortgage payments - such as their assets and credit history.
But the political pressure was intense - with few in politics or media eager to speak the truth. And then, in 1992, came a study from four researchers at the Boston Fed, which seemed to bear out the critics' contentions.
That study was, in fact, based on quite flawed data - but the authors' political, media and academic protectors stifled most serious criticism, smearing the reputation of one whistleblower ...
When someone hires 10 of his friends to put a bunch bullets in productive enterprises and then pay off a judge to say they are innocent and the victims can pay them expenses and legal fees, they are all guilty of fraud, bribery conspiracy and extortion. All of them. Anyone trying to argue comparative guilt, or worse that some of the crooks should be let off because there are other crooks still at large belongs in the loony bin.
I agree with every word you wrote. Paulson and Bernanke are Dems and I think they are making this sound a lot worse than it is, for election purposes. I can’t believe President Bush is going to hand them $700B. I getting scared for McCain.
Most of the highly leveraged debt in question isn’t even mortgage loans. It is commercial loans. Mortgages are just the fuse on the bomb that was about to blow anyway.
"After that, Mr. McCain can get on to witness No. 1: Phil Gramm, a former adviser to the candidate on economic issues and for many years the heavyweight champion of financial deregulation. It was this very fellow who, as a senator, co-authored the Financial Services Modernization Act, largely trashing the old financial regulatory structure and allowed banks, insurance companies and investment houses to merge into what Mr. Gramm called "a supermarket for financial services" -- supermarkets whose lousy decisions are now the wonder of the world and whose losses we will be underwriting for years to come."
http://en.wikipedia.org/wiki/Gramm-Leach-Bliley_Act
[edit] Congressional history of the Act The bills were introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA). The bills were passed by a 54-44 vote largely along party lines with Republican support in the Senate[1] and by a 343-86 vote in the House of Representatives[2]. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. Democrats agreed to support the bill only after Republicans agreed to strengthen provisions of the Community Reinvestment Act and address certain privacy concerns.[3] The final bipartisan bill resolving the differences was passed in the Senate 90-8-1-1 ( Sen. Peter Fitzgerald (R-IL) being the only U.S. Senator voting Present on the measure. Sen. John McCain (R-AZ) being the only U.S. Senator reported as necessarily absent during the roll call and recorded as Not Voting on the measure.)[4][5] and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999. [6]
The banking industry had been seeking the repeal of Glass-Steagall since at least the 1980s. In 1987 the Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall and the case against preserving the act.[7]
Must see video! Great way to start the day!
Obamonopoly
http://www.youtube.com/watch?v=bVxqXxukw7I&eurl=http://ace.mu.nu/
This goes back to the Clinton admistration, 10-15 years ago.
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