Posted on 09/24/2008 7:13:39 AM PDT by Mr. K
The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.
Under the plan, [...] a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.
The new agency would have the authority, [...]to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks [...]
The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac — which together have issued more than $1.5 trillion in outstanding debt — is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors[...]
... Among the groups denouncing the proposal today were [...] Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.
‘’These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,’’ said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee.’’The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.’’
Representative Melvin L. Watt, Democrat of North Carolina, agreed. ‘’I don’t see much other than a shell game going on here, [...]weakening the bargaining power of poorer families and their ability to get affordable housing,’’ Mr. Watt said
(Excerpt) Read more at nytimes.com ...
IT WAS POSTED IN RESPONSE TO ANOTHER ARTICLE BUT I THOUGHT IT DESERVED ITS OWN THREAD
I CANNOT FIND A LINK TO THE ORIGINAL STORY NBUT WE NEED TO FIND IT BEFORE THEY REMOVE IT
These same pompous jerks are now on TV saying it was Bush’s fault.
the democrats in congress were (are) in the back pocket of fannie and fred. It’s interesting, that Barney Frank and Chris Dodd, still do not want to limit Fan/Fred’s influence in the mortgage market.
This may be the link you are seeking:
The problem came from the government guaranteeing loans that no sane banker would make with his own money. Mortgages have had nothing resembling a free market for many, many years.
Congressman Billybob
Thanks.
The link is above and I have saved copies of that article and others from a Lexis/Nexis search. Interesting reading.
Yeah, those evil Bush policies sure caused this crisis. The Dems are a pack of liars.
This IS the fault of Democrats from top to bottom.
President Bush and the Republicans TRIED to fix it before it turned into a problem but Democrats were too stupid or too worried about votes to fix it.
This news will make it to some mainstream media outlets, IMO. I heard a radio program last night with Barney Frank’s now damning testimony. Its coming out.
This sanctiomonious windbag, Barney “Fwank”, like most of his Democratic colleagues, has 20-10 hindsight and can only spin events after they occur. Obama has built his entire campaign upon things he said he would have done to avert current problems.
but ... but ... but ... I thought it was all Bush’s fault!?
The only extent of Bush’s responsibility is that he seemed to have lost his VETO pen for a number of years.
WHERE THE HELL IS THE BULLY PULPIT ON THIS???!!!
Mr President, the new tone crap is KILLING US!!!
GOP, this should be pounded home again and again!
Where are McCain and Palin today? Where are the congressional Repubs? They should be waving this over their heads and shouting it from the rooftops!!!!
A NEW AGENCY? ONLY AFTER EVERYONE IS FIRED FROM THE OLD AGENCY THAT HA OVERSIGHT RESPONSIBILITY.
Yes... this is great reading. But, this is the BEGINNING of this legislative proposal... where is the ENDING?
Why and when did it die?
Still, the most damaging legacy of Fannie Mae's years of unchecked growth may not be evident until the next significant economic slump. Only then, argued Josh Rosner, an analyst at Medley Global Advisors in New York, will the effects of Fannie's relaxed mortgage underwriting standards be felt. A result could be a more pronounced downturn in the real estate market and more stress on the consumer.
The move to push homeownership on people that historically would not have had the finances or credit to qualify could conceivably and ultimately turn Fannie Mae's American dream of homeownership into the American nightmare of homeownership where people are trapped in their homes,'' Mr. Rosner said. ''If incomes don't rise or home values don't keep rising, or if interest rates rose considerably, you could quickly end up with significantly more people underwater with their mortgages and unable to pay.''
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