Dems did NOT cause meltdown- Pub Propaganda as usual....

[hellofromwarsaw]

TYVM- Pubtrolls!! Banana Republicans!! Brainwashed! Haters!

 

[whitehall]

An opinion about Fannie Mae from Poland based on the opinions of two unknown writers and Warsaw calls it facts. You almost gotta laugh. Fannie Mae was a "parnership" between congress and the private sector. You could call it a trial run for socialism but if you check congress' record in running a company you will find that they couldn't even run a post office without stealing stamps. The congressional caffeteria was so poorly managed that it went broke. The federal government does not earn a dime and never has. It confiscates money from people who earn it. Fannie Mae was so poorly managed that the board of directors (paid six figures per anum) had no experience in the mortage or banking field. They were no-show political hacks who were paid off usually after losing their cushy federal jobs. One Fannie CEO, Frank Raines was paid a bonus each year which was tied to Fannie's profits. He walked away with 90 MILLION for three years work by allegedly cooking the books while Fannie was losing money. He is one of Obama's financial advisors today.

 

[hellofromwarsaw]

 

[rdean]

What the fuck happened to paragraphs?

Plus, Dems under Clinton had the chance to regulate toxic derivatives, but what did they do? They chased Brooksley Borne out of Washington. Then Obama hired old Clintonites such as Summers, Geithner, and Gensler. Now Gensler is heading the CTFC.

Plus, both parties are responsible. However, Dems played their role.

We are just lucky that Republicans, who controlled both houses under Bush, didn't deregulate Wall Street moving 70% of the mortgage market to Wall Street.

Oh, wait.

Oops, nevermind.

 

[Susan45]

Credit Crisis

The Crisis of Credit Visualized

Terrific animation explaining the crisis.

 

[hellofromwarsaw]

FCS WH, the article is FULL of documented facts, and the conclusions are obvious. You are duped, and have nothing but obviously stupid insults, the usual reaction of a dumbazz caught repeating stupid lies, the predicament of dittoheads. tyvm

Stupidest party in the modern world. Tools of greedy rich... Hoping for your recovery...

 

[Toddsterpatriot]

Read the GD OP, dupe...Over 80% of the problem was private morgagers duh....

The bad loans held by the private mortgage companies were paid for by the private mortgage companies.
The bad loans held by Fannie and Freddie are paid for by the US taxpayer. Duh.
Thanks Barney Frank. At least his boyfriend got a job.

 

[hellofromwarsaw]

Guess you never heard of bailouts. Sorely misled.

 

[Susan45]

Private sector loans, not Fannie or Freddie, triggered crisis

Commentators say that's what triggered the stock market meltdown and the freeze on credit. They've specifically targeted the mortgage finance giants Fannie Mae and Freddie Mac, which the federal government seized on Sept. 6, contending that lending to poor and minority Americans caused Fannie's and Freddie's financial problems.

Federal housing data reveal that the charges aren't true, and that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis.

Subprime lending offered high-cost loans to the weakest borrowers during the housing boom that lasted from 2001 to 2007. Subprime lending was at its height from 2004 to 2006.

Federal Reserve Board data show that:

* More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions.

* Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year.

* Only one of the top 25 subprime lenders in 2006 was directly subject to the housing law that's being lambasted by conservative critics.

Read more: Private sector loans, not Fannie or Freddie, triggered crisis | McClatchy

 

[hellofromwarsaw]

Not to mention Greece, Spain, Iceland, Ireland, etc, etc,etc. Great job, Booooshies...

 

[Toddsterpatriot]

Guess you never heard of bailouts. Sorely misled.

The bank portion of TARP was repaid, at a profit to the Treasury.
The Fannie and Freddie portion of the bailout will never be repaid.
$153 billion so far.....

Fannie, Freddie reform won't halt more huge taxpayer losses - Feb. 11, 2011

 

[hellofromwarsaw]

NOT!

While it’s maybe more true than it was maybe a year ago, the notion that “the bailouts were repaid” is still one of the great myths of the crisis era.
Most of the time, when people talk about the bailouts being paid back, what they’re referring to is the TARP or Troubled Asset Relief Program, which among other things involved direct cash injections into companies like Goldman Sachs. It is true that most of the money lent out via TARP has been paid back, with interest. Goldman, for instance, paid back its entire $10 billion loan.

But the bailouts reached far beyond cash loans, and that money is mostly never coming back. Take the case of Goldman. Goldman got $10 billion via TARP, but it also got $12.9 billion through the bailout of AIG, money that it would have lost otherwise; that money is never going to be “paid back.”

Another typical method of bailing out companies without direct cash injections was to allow firms to borrow money against a state guarantee. What programs like the TLGP (Temporary Liquidity Guarantee Program) allowed the banks to do was borrow against the government’s charge card instead of against their own more risky profiles. That way, the banks were able to spend billions less in finance costs on the money they borrowed. Goldman, for instance, borrowed at least $19 billion against the TLGP. How much more would they have had to pay to borrow $19 billion on the open market, without the government guarantee? Hard to say, but the figure is surely in the hundreds of millions.

There were other bailout methods that included getting the state to absorb investment losses (in programs like the PPIP, you kept your investment gains when you bought risky assets, but the state took the losses) and opening facilities that allowed the state to buy crappy assets from banks at above market value. Banks also got to post worthless assets as collateral to the Fed in exchange for cash. None of these things were direct cash injections; they were all sneaky ways to give the banks risk-free “profits” using government guarantees and loans.

The biggest bailout mechanism was the banks’ ability to go to the Fed and borrow hundreds of billions in emergency loans at rock-bottom interest rates, or sometimes at zero. Goldman, for instance, borrowed $600 billion in emergency loans during the crisis period, which makes the $10 billion TARP payment look meager.

Your friend would say that the banks ultimately paid those loans back, which is true, but put it this way: If a bank can go to the Fed, borrow $100 billion at 0% interest, lend it out on the market to all of us suckers as 4% mortgages and 11% credit cards and so on, what does it mean when it “returns” that money to the Fed later on? Are the profits they make in the meantime “earned” money, or is that subsidy? You and I don’t have the ability to borrow at 0%, but Goldman and JP Morgan Chase do.

Not to belabor the point, but there’s another hidden cost to all of us; since the bailouts demonstrated to the market that the state will never let the big banks fail, that means that smaller banks now have to spend more money to borrow on the open market, since they don’t have the same implicit guarantee. So if too-big-to-fail Goldman can borrow at 1.5% while Small-Enough-to-Fail Schmuck Local Bank has to borrow at 3%, that 1.5% is another hidden bailout that will not, of course, ever be paid back.

One could go on and on with this, but here’s the upshot: Yes, the banks mostly paid back the cash bailouts. But they didn’t pay back the money they got via hidden bailouts (like the AIG rescue) and they certainly won’t ever pay back the trillions they received via state guarantees and artificially reduced borrowing costs, which really all came out of our pockets. The bailouts allowed the banks to borrow for less from the state, while simultaneously paying less to private depositors and charging private borrowers more. That’s the real value of the bailout – the difference between how much they have to pay to borrow from the Fed, and how much we have to pay to borrow from them.

Not to mention the ongoing 2nd Worldwide PUB Great Depression...

 

[American Cowboy]

Everything that is wrong with America is due to Democrats

 

[hellofromwarsaw]

You are bizarro man and absolutely misled, bumper sticker boy.

 

[theHawk]

LOL, reading through this thread its pretty obvious moronfromwarsaw is wigging out.

He just can't handle the fact that the banking industry, practically micromanaged by Fannie and Freddie, took a nose dive thanks to the toxic assests the banks were forced to take on. As did of course the rest of the economy while Dems were in power. They did nothing to stop it, and continued to do nothing even when they had full control of the government.

Now these idiotic liberals are in full spin mode, constantly attacking conservatives with their bumper sticker slogans and the occasional Op-ed presented as 'fact'.

 

[hellofromwarsaw]

But thanks for the Depression, the stupidest wars EVER, and ruining political discussion and cooperationin the country, greedy racist un-American mega rich shyttes and silly dupes....guess which you are...

 

[Toddsterpatriot]

NOT!

While it’s maybe more true than it was maybe a year ago, the notion that “the bailouts were repaid” is still one of the great myths of the crisis era.

The banks repaid their loans. The Treasury made a profit. Sorry if that ruins your rant.

Most of the time, when people talk about the bailouts being paid back, what they’re referring to is the TARP or Troubled Asset Relief Program, which among other things involved direct cash injections into companies like Goldman Sachs. It is true that most of the money lent out via TARP has been paid back, with interest. Goldman, for instance, paid back its entire $10 billion loan.

But the bailouts reached far beyond cash loans, and that money is mostly never coming back. Take the case of Goldman. Goldman got $10 billion via TARP, but it also got $12.9 billion through the bailout of AIG, money that it would have lost otherwise; that money is never going to be “paid back.”

The Treasury will probably break even on AIG. So what about Goldman?

Another typical method of bailing out companies without direct cash injections was to allow firms to borrow money against a state guarantee. What programs like the TLGP (Temporary Liquidity Guarantee Program) allowed the banks to do was borrow against the government’s charge card instead of against their own more risky profiles. That way, the banks were able to spend billions less in finance costs on the money they borrowed. Goldman, for instance, borrowed at least $19 billion against the TLGP. How much more would they have had to pay to borrow $19 billion on the open market, without the government guarantee? Hard to say, but the figure is surely in the hundreds of millions.

That's awful! The bank guarantees made the Treasury money. Also, the banks pay taxes on their profits.
The guarantees for Fannie and Freddie will cost the Treasury over $100 billion.

The biggest bailout mechanism was the banks’ ability to go to the Fed and borrow hundreds of billions in emergency loans at rock-bottom interest rates, or sometimes at zero. Goldman, for instance, borrowed $600 billion in emergency loans during the crisis period, which makes the $10 billion TARP payment look meager.

Short term loans already repaid at a profit to the Fed.

Your friend would say that the banks ultimately paid those loans back, which is true, but put it this way: If a bank can go to the Fed, borrow $100 billion at 0% interest, lend it out on the market to all of us suckers as 4% mortgages and 11% credit cards and so on, what does it mean when it “returns” that money to the Fed later on? Are the profits they make in the meantime “earned” money, or is that subsidy? You and I don’t have the ability to borrow at 0%, but Goldman and JP Morgan Chase do.

The current Discount Rate is 0.75%. It's such a good deal that banks are currently borrowing $20 million at the Discount window. LOL!
I grade your post FAIL!

 

[hellofromwarsaw]

Sure. I'll go with facts about the costs, and the guilty.

Levin-Coburn Report On the Financial Crisis

WASHINGTON – Concluding a two-year bipartisan investigation, Senator Carl Levin, D-Mich., and Senator Tom Coburn M.D., R-Okla., Chairman and Ranking Republican on the Senate Permanent Subcommittee on Investigations, today released a 635-page final report on their inquiry into key causes of the financial crisis. The report catalogs conflicts of interest, heedless risk-taking and failures of federal oversight that helped push the country into the deepest recession since the Great Depression.

“Using emails, memos and other internal documents, this report tells the inside story of an economic assault that cost millions of Americans their jobs and homes, while wiping out investors, good businesses, and markets,” said Levin. “High risk lending, regulatory failures, inflated credit ratings, and Wall Street firms engaging in massive conflicts of interest, contaminated the U.S. financial system with toxic mortgages and undermined public trust in U.S. markets. Using their own words in documents subpoenaed by the Subcommittee, the report discloses how financial firms deliberately took advantage of their clients and investors, how credit rating agencies assigned AAA ratings to high risk securities, and how regulators sat on their hands instead of reining in the unsafe and unsound practices all around them. Rampant conflicts of interest are the threads that run through every chapter of this sordid story.”

“The free market has helped make America great, but it only functions when people deal with each other honestly and transparently. At the heart of the financial crisis were unresolved, and often undisclosed, conflicts of interest,” said Dr. Coburn. “Blame for this mess lies everywhere from federal regulators who cast a blind eye, Wall Street bankers who let greed run wild, and members of Congress who failed to provide oversight.”

The Levin-Coburn report expands on evidence gathered at four Subcommittee hearings in April 2010, examining four aspects of the crisis through detailed case studies: high-risk mortgage lending, using the case of Washington Mutual Bank, a $300 billion thrift that became the largest bank failure in U.S. history; regulatory inaction, focusing on the Office of Thrift Supervision’s failed oversight of Washington Mutual; inflated credit ratings that misled investors, examining the actions of the nation’s two largest credit rating agencies, Moody’s and Standard & Poor’s; and the role played by investment banks, focusing primarily on Goldman Sachs, creating and selling structured finance products that foisted billions of dollars of losses on investors, while the bank itself profited from betting against the mortgage market.

New Evidence. Today’s report presents new facts, new findings and recommendations, with more than 700 new documents totaling over 5,800 pages. It recounts how Washington Mutual aggressively issued and sold high-risk mortgages to Wall Street, Fannie Mae, and Freddie Mac, even as its executives predicted a housing bubble that would burst, and offers new detail about how its regulator deferred to the bank’s management. New documents show how Goldman used net short positions to benefit from the downturn in the mortgage market, and designed, marketed, and sold CDOs in ways that created conflicts of interest with the firm’s clients and at times led to the bank’s profiting from the same products that caused substantial losses for its clients. Other new information provides additional detail about how credit rating agencies rushed to rate new mortgage-backed securities and collect lucrative rating fees before issuing mass ratings downgrades that shocked the financial markets and triggered a collapse in the value of mortgage related securities. Over 120 new documents provide insights into how Deutsche Bank contributed to the mortgage mess.

“Our investigation found a financial snake pit rife with greed, conflicts of interest, and wrongdoing,” said Levin. Among the report’s highlights are the following.

• High Risk Lending. With an eye on short term profits, Washington Mutual launched a strategy of high-risk mortgage lending in early 2005, even as the bank’s own top executives stated that the condition of the housing market “signifies a bubble” with risks that “will come back to haunt us.” Executives forged ahead despite repeated warnings from inside and outside the bank that the risks were excessive, its lending standards and risk management systems were deficient, and many of its loans were tainted by fraud or prone to early default. WaMu’s chief credit officer complained at one point that “[a]ny attempts to enforce [a] more disciplined underwriting approach were continuously thwarted by an aggressive, and often times abusive group of Sales employees within the organization.” From 2003 to 2006, WaMu shifted its loan originations from low risk, fixed rate mortgages, which fell from 64% to 25% of its loan originations, to high risk loans, which jumped from 19% to 55% of its originations. WaMu and its subprime lender, Long Beach Mortgage, securitized hundreds of billions of dollars in high risk, poor quality, sometimes fraudulent mortgages, at times without full disclosure to investors, weakening U.S. financial markets. New analysis shows how WaMu sold some of its high risk loans to Fannie Mae and Freddie Mac, and played one off the other to make more money.

• Regulatory Failures. The Office of Thrift Supervision (OTS), Washington Mutual’s primary regulator, repeatedly failed to correct WaMu’s unsafe and unsound lending practices, despite logging nearly 500 serious deficiencies at the bank over five years, from 2003 to 2008. New information details the regulator’s deference to bank management and how it used the bank’s short term profits to excuse high risk activities. Although WaMu recorded increasing problems from its high risk loans, including delinquencies that doubled year after year in its risky Option Adjustable Rate Mortgage (ARM) portfolio, OTS examiners failed to clamp down on WaMu’s high risk lending. OTS did not even consider bringing an enforcement action against the bank until it began losing substantial sums in 2008. OTS also failed until 2008, to lower the bank’s overall high rating or the rating awarded to WaMu’s management, despite the bank’s ongoing failure to correct serious deficiencies. When the Federal Deposit Insurance Corporation (FDIC) advocated taking tougher action, OTS officials not only refused, but impeded FDIC oversight of the bank. When the New York State Attorney General sued two appraisal firms for colluding with WaMu to inflate property values, OTS took nearly a year to conduct its own investigation and finally recommended taking action -- a week after the bank had failed. The OTS Director treated WaMu, which was its largest thrift and supplied 15% of the agency’s budget, as a “constituent” and struck an apologetic tone when informing WaMu’s CEO of its decision to take an enforcement action. When diligent oversight conflicted with OTS officials’ desire to protect their “constituent” and the agency’s own turf, they ignored their oversight responsibilities.

• Inflated Credit Ratings. The Report concludes that the most immediate cause of the financial crisis was the July 2007 mass ratings downgrades by Moody’s and Standard & Poor’s that exposed the risky nature of mortgage-related investments that, just months before, the same firms had deemed to be as safe as Treasury bills. The result was a collapse in the value of mortgage related securities that devastated investors. Internal emails show that credit rating agency personnel knew their ratings would not “hold” and delayed imposing tougher ratings criteria to “massage the … numbers to preserve market share.” Even after they finally adjusted their risk models to reflect the higher risk mortgages being issued, the firms often failed to apply the revised models to existing securities, and helped investment banks rush risky investments to market before tougher rating criteria took effect. They also continued to pull in lucrative fees of up to $135,000 to rate a mortgage backed security and up to $750,000 to rate a collateralized debt obligation (CDO) – fees that might have been lost if they angered issuers by providing lower ratings. The mass rating downgrades they finally initiated were not an effort to come clean, but were necessitated by skyrocketing mortgage delinquencies and securities plummeting in value. In the end, over 90% of the AAA ratings given to mortgage-backed securities in 2006 and 2007 were downgraded to junk status, including 75 out of 75 AAA-rated Long Beach securities issued in 2006. When sound credit ratings conflicted with collecting profitable fees, credit rating agencies chose the fees.

• Investment Banks and Structured Finance. Investment banks reviewed by the Subcommittee assembled and sold billions of dollars in mortgage-related investments that flooded financial markets with high-risk assets. They charged $1 to $8 million in fees to construct, underwrite, and market a mortgage-backed security, and $5 to $10 million per CDO. New documents detail how Deutsche Bank helped assembled a $1.1 billion CDO known as Gemstone 7, stood by as it was filled it with low-quality assets that its top CDO trader referred to as “crap” and “pigs,” and rushed to sell it “before the market falls off a cliff.” Deutsche Bank lost $4.5 billion when the mortgage market collapsed, but would have lost even more if it had not cut its losses by selling CDOs like Gemstone. When Goldman Sachs realized the mortgage market was in decline, it took actions to profit from that decline at the expense of its clients. New documents detail how, in 2007, Goldman’s Structured Products Group twice amassed and profited from large net short positions in mortgage related securities. At the same time the firm was betting against the mortgage market as a whole, Goldman assembled and aggressively marketed to its clients poor quality CDOs that it actively bet against by taking large short positions in those transactions. New documents and information detail how Goldman recommended four CDOs, Hudson, Anderson, Timberwolf, and Abacus, to its clients without fully disclosing key information about those products, Goldman’s own market views, or its adverse economic interests. For example, in Hudson, Goldman told investors that its interests were “aligned” with theirs when, in fact, Goldman held 100% of the short side of the CDO and had adverse interests to the investors, and described Hudson’s assets were “sourced from the Street,” when in fact, Goldman had selected and priced the assets without any third party involvement. New documents also reveal that, at one point in May 2007, Goldman Sachs unsuccessfully tried to execute a “short squeeze” in the mortgage market so that Goldman could scoop up short positions at artificially depressed prices and profit as the mortgage market declined.

Excerpted from the Press Release regarding the Levin-Coburn Report on the Financial Crisis

http://hsgac.senate.gov/public/index.cfm....0-6674 916e133d

Pubs caused the bubble, the bust and the 2nd Pub Great Depression, and are now screwing up the recovery, all for political gain, all to get power back and screw the non rich AGAIN. When will their fools ever learn.

 

[Toddsterpatriot]

Sure. I'll go with facts about the costs, and the guilty.

Levin-Coburn Report On the Financial Crisis

WASHINGTON – Concluding a two-year bipartisan investigation, Senator Carl Levin, D-Mich., and Senator Tom Coburn M.D., R-Okla., Chairman and Ranking Republican on the Senate Permanent Subcommittee on Investigations, today released a 635-page final report on their inquiry into key causes of the financial crisis. The report catalogs conflicts of interest, heedless risk-taking and failures of federal oversight that helped push the country into the deepest recession since the Great Depression.

But enough about Fannie and Freddie.

Pubs caused the bubble, the bust and the 2nd Pub Great Depression, and are now screwing up the recovery, all for political gain, all to get power back and screw the non rich AGAIN. When will their fools ever learn.

Bush shouldn't have pushed for more home ownership for the poor, but CRA and Fannie and Freddie was all Dems.

 

[Two Thumbs]

It's funny how this run of the mill poster knows what caused the economy to fall and yet for over 2 years, those in charge now, have done nothing to make it better.

Is that also only the reps fault?