Posted on 11/30/2016 10:22:52 AM PST by SeekAndFind
It appears Elizabeth Warren does not think too highly of President-elect Donald Trump's nomination of Steven Mnuchin for Treasury secretary.
In a statement, the Massachusetts senator said Mnuchin was involved in the worst kind of lending practices that led to the financial crisis during his time as head of mortgage lending at Goldman Sachs.
"Steve Mnuchin is the Forrest Gump of the financial crisis — he managed to participate in all the worst practices on Wall Street," Warren said in a statement, according to Politico's Ben White.
"He spent two decades at Goldman Sachs helping the bank peddle the same kind of mortgage products that blew up the economy and sucked down billions in taxpayer bailout money before he moved on to run a bank that was infamous for aggressively foreclosing on families."
Warren's comparison of Mnuchin is to the 1994 Oscar-winning film Forrest Gump, in which Tom Hanks stumbles in and out of historical moments from the 1960s onwards as the eponymous Forrest.
Mnuchin worked at Goldman Sachs for 17 years and left the bank in 2002. During his time he oversaw the mortgage-lending department as it delved into such products as credit default swaps and collateralized debt obligations.
He later founded his own private-equity firm, Dune Capital Management, which in 2009 purchased the distressed-mortgage lender IndyMac, which was renamed OneWest. The firm and Mnuchin have been accused of unfair lending practices including discriminating against minority borrowers and aggressive foreclosures.
(Excerpt) Read more at businessinsider.com ...
I’d say that Forest Gump would hit on Elizabeth Warren, maybe dog shag her leg a little.
Which is better than just about anyone else would give her.
It is telling that no one is responding to your post.
Go back to your wigwam and make me a samich.
The Government made the rules that forced the banks to give out loans that were fragile.
The banks would never do such on their own.
At one time, a developer told me ‘If you could fog a mirror” you got a real estate loan because the government forced it.
People got loans for real estate that were NOT qualified to buy a T-shirt on time payments.
In Fresno, an ILLEGAL fruit picker was given a loan for a $650,000 house. He got it foreclosed when he didn’t make a single payment. And—I say again—he was an ILLEGAL!!!
Even her biggest supporter Mika is getting tired of her
[BTW: Forest Gump led a very successful life through hard work, perseverance and solid moral character.]
He founded Bubba Gump Shrimp!!
That Pocahontas sure is a mean, spiteful, sharp tongued woman. I think a lot a people are beginning to tire of her, even some in her own party.
[I’d say that Forest Gump would hit on Elizabeth Warren, maybe dog shag her leg a little.]
Even Forrest Gump is not that pathetic and hard up. Even HE banged hot-ass Robin Wright!!
We're not supposed to point that out. And no "probably" about it.
I know it happened a long time ago, but it looks the people have forgotten the Community Reinvestment Act, which forced banks to make loans to people living in areas notorious for bad debts.
I worked in banking back then, and I was amazed at the crap mortgages we had to make to people who could not afford them. And we were doing the best job of scoring among our competitors.
But, since it happened so long ago, Liz Warren will rewrite the Collapse of ‘08.
[Rumor in DC has it that Trump is going to offer her a position as head of the Bureau of Indian Affairs...]
I know that is sarcasm, but I would LOVE to see Liawatha’s reaction if he were to do that! I think she’d have a stroke!!
BTW: I always found Forest Gump to be nothing more than a highlight reel of Liberalism from the 60’s and 70’s.
That’s what I was thinking, too.
Didn’t know what to think about the guy but since warren said this, I’m thinking he must be a great pick then!
I wasn’t sure about this pick... mostly because I’m sick of Goldman Sachs setting financial policy in this country. But he does seem to have the right enemies...
I don’t know that they “leveraged” bad loans as much as sold them. That’s normally what you do with bad paper. It’s not evil.
Borrowers came to the banks, not the other way around.
If you get a loan for a car and then decide you don’t want to pay it anymore, that’s not the bank’s fault.
Pepsionice . . .
The crux of the financial crisis was the lowering of the credit standards to take out a mortgage. It started with a laudable goal of removing the practice of redlining, where banks would not make ANY mortgage loans even to those creditworthy within the area they cordoned off. That led to the Community Reinvestment Act, where it was assumed that over time there would be some higher default rates but at least there would also be success stories.
The Clinton Administration changed the CRA compliance from comparing default rates among the various classes to being more of a front-end quota system. As long as housing prices rose that masked a lot of issues but eventually the housing market cooled.
When you lower lending rates at the bottom that also means lowering them throughout the credit curve. Many lower income earners were encouraged to take out mortgages, with little or no money down, poor documentation (remember the term Liar Loans?), etc. On top of that, a lot of speculation came into the market in the middle class and upper middle class as lenders were willing to lend based on the underlying value of homes the borrower already owned, a form of leverage that is akin to margin trading on Wall Street.
Banks were willing to go along with this due to what you referred to, the pooling of mortgages for seuritization, which took the credit risk from the bank and put it on the investor (in many instances foreign investors and borrowers who were not historically knowledgeable about US housing cycles). But this was tangential, not causative of the eventual crash. Mortgage pools were invented back in the late 70’s if memory serves as MBS Pools and was a legitimate investment if you understood the product.
Eventually, the political will to do anything to ‘prick the housing bubble’ subsided as the Bush Administration raised the alarm but frankly didn’t really do anything about it until it was too late. Fannie Mae was run by old Clinton Admin allies and members like Jim Johnson (the ultimate Washington DC insider on the Dem side, Franklin Raines and Jamie Gorelick of the Chinese Wall Memo fame) and they manipulated earnings to maximize bonuses (for example, Raines was forced to disgorge income in a plea bargain to avoid prosecution) while lobbying to reduce capital expenditures and requirements on their portfolio of loans.
Then eventually the whole thing implodes and housing price declines accelerated as forced sales and foreclosures shoved supply down the market’s throats and eventually you ended up with TARP. And an Obama presidency on top of that.
Hope that helps.
Forest Gump? You mean the guy that somehow always manged to do the right thing?
I’m don’t think she really thought that one through...
Come on Lizzi Spreading Bull, tell us all what have you done?
Sorry flapping your jaw is not real work
Tell us all what you have done with your time in the senate?
Please lizzie enlighten all of us
and he was by far the smartest guy in the movie ...
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