Posted on 09/08/2008 7:06:36 AM PDT by joinedafterattack
There are as many starting points for the mortgage meltdown as there are fears about how far it has yet to go, but one decisive point of departure is the final years of the Clinton administration, when a kid from Queens without any real banking or real-estate experience was the only man in Washington with the power to regulate the giants of home finance, the Federal National Mortgage Association (FNMA) and the Federal Home Loan Mortgage Corporation (FHLMC), better known as Fannie Mae and Freddie Mac.
Andrew Cuomo, the youngest Housing and Urban Development secretary in history, made a series of decisions between 1997 and 2001 that gave birth to the country's current crisis. He took actions that—in combination with many other factors—helped plunge Fannie and Freddie into the subprime markets without putting in place the means to monitor their increasingly risky investments. He turned the Federal Housing Administration mortgage program into a sweetheart lender with sky-high loan ceilings and no money down, and he legalized what a federal judge has branded "kickbacks" to brokers that have fueled the sale of overpriced and unsupportable loans. Three to four million families are now facing foreclosure, and Cuomo is one of the reasons why.
(Excerpt) Read more at villagevoice.com ...
Those are the interests that surrounded Cuomo, who did more to set these forces of unregulated expansion in motion than any other secretary and then boasted about it, presenting his initiatives as crusades for racial and social justice.
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And people in this country want ANOTHER radical liberal president in the White House??
There shouldn’t even be a Department of Housing and Urban Development.
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The Government didn’t cause the crisis. Greed was the cause. From people being greedy so they lied on their applications. To mortgage companies and banks that knowingly accepted those lies.
The Federal government has to take action to correct the problems the Federal government created.
Remember the Savings and Loan fiasco, when “reforms” in the Federal law created an unregulated banking industry?
The Federal government has to take action to correct the problems the Federal government created.
Remember the Savings and Loan fiasco, when “reforms” in the Federal law created an unregulated banking industry?
The sad fact is that Cuomo’s surrender on YSPs can’t be excused as an unfortunate consequence of well-motivated policy, as his defenders have argued regarding his FHA and GSE actions. He has no cover for this one; it exposes him as an agent of special interests. And looking at his GSE and FHA policies through the lens of his retreat on these payoffs (which even Glaser, in a marked change from his MBA days, now condemns) suggests a pattern of compromised judgments.
Democrats believe in something for nothing. Free markets don’t work that way.
Whoa...I would never have gone to The Village Voice - thank you so much for posting this piece.
It needs to start getting hammered- the Dems set this disaster up...even JIM CRAMER said this morning it lies squarely at the feet of the Dems and their lobbyists
Wrong and right. The government was greedy.
Then the govt agreed to buy those bad mortgages. Without that critical factor they never would have been originated.
They never should have bought these mortgages. The politicians will try and blame it on the banks..but they were just doing what comes naturally.
Why do you think Mizzula Oil was sitting in Johnson’s office when Dodd calledu.
Give us all a break. What Republicans spoke out when the housing bubble was going insane in 2002-2004? Both parties had their noses firmly up the cracks of the banking and building industries.
W was also pushing home ownership above all else. He's in on this mess too.
Was this the focus of the Barrett report?
“To mortgage companies and banks that knowingly accepted those lies.”
WHY NOT?
There was no penalty, not even for blatant MORTGAGE FRAUD. This has been the greatest inner-city money game OF ALL TIME.
And all because of Jesse Jackson’s rants about “RACIST MORTGAGE BANKS!!!” and “Red-Lining”.
So, yet again, WE get to pay the price for failed Democrat Policies based on lies and Propoganda.
Your being naive.
Gov’t central planners had their hand in this. Pres. Bush wanted 5.5 Mil more homeowners. Well, he got it. We are all homeowners now.
‘We are here in Washington, D.C. to address problems. So I’ve set this goal for the country. We want 5.5 million more homeowners by 2010 — million more minority homeowners by 2010. (Applause.) Five-and-a-half million families by 2010 will own a home. That is our goal. It is a realistic goal. But it’s going to mean we’re going to have to work hard to achieve the goal, all of us. And by all of us, I mean not only the federal government, but the private sector, as well.’
http://www.whitehouse.gov/news/releases/2002/06/20020618-1.html
‘And so we’ve called upon Congress to set up what’s called the American Dream Down Payment Fund, which will provide financial grants to local governments to help first-time home buyers who qualify to make the down payment on their home. If a down payment is a problem, there’s a way we can address that. And when Congress funds the program, this should help 200,000 new families over the next five years become first-time home buyers.
More and more people own their homes in America today. Two-thirds of all Americans own their homes, yet we have a problem here in America because few than half of the Hispanics and half the African Americans own the home. That’s a homeownership gap. It’s a — it’s a gap that we’ve got to work together to close for the good of our country, for the sake of a more hopeful future. We’ve got to work to knock down the barriers that have created a homeownership gap.
I set an ambitious goal. It’s one that I believe we can achieve. It’s a clear goal, that by the end of this decade we’ll increase the number of minority homeowners by at least 5.5 million families. (Applause.)’
http://www.whitehouse.gov/news/releases/2002/10/20021015-7.html
‘There was no penalty, not even for blatant MORTGAGE FRAUD. This has been the greatest inner-city money game OF ALL TIME”
Yes there were penalties. The laws were/are not being enforced. IMO the leadership of all these banks and mortgage company’s should be in jail.
“Your being naive.”
I frequently am.
“Gov’t central planners had their hand in this. Pres. Bush wanted 5.5 Mil more homeowners. Well, he got it. We are all homeowners now.”
So its Bush’s fault? Bush’s fault that banks voluntarily made bad loans? Bush’s fault that they knowingly accepted fraudulent information?
BDS is what you got.
The simple fact is the Gov’t shouldn't decide how many homeowners are created or tell banks to give loans to minorities who can't qualify.
Gee, a system which loans billions in the name of “fairness” and political correctness rather than sound economic practices actually blows up! Well color me shocked.
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