New Study Finds Democrats Fully to Blame for Subprime Mortgage Crisis that Caused 200

Discussion in 'Politics' started by Doc91678, Dec 22, 2012.

  1. Doc91678
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    by Jim Hoft
    December 22, 2012

    In his early activist days, Barack Obama the community organizer sued banks to ease lending practices.

    [​IMG]
    State Sen. Barack Obama and Fr. Michael Pfleger led a protest against the payday loan industry demanding the State of Illinois to regulate loan businesses in January 2000. During his time as a community organizer Barack Obama led several protests against banks to make loans to high risk individuals. (NBC 5 Week of January 3, 2000)

    Here’s something that won’t get any play in the liberal media…
    A new study by the respected National Bureau of Economic Research found that Democrats are to blame for the subprime mortgage crisis.
    Investor’s Business Daily reported:


    Democrats and the media insist the Community Reinvestment Act, the anti-redlining law beefed up by President Clinton, had nothing to do with the subprime mortgage crisis and recession.

    But a new study by the respected National Bureau of Economic Research finds, “Yes, it did. We find that adherence to that act led to riskier lending by banks.”

    Added NBER: “There is a clear pattern of increased defaults for loans made by these banks in quarters around the (CRA) exam. Moreover, the effects are larger for loans made within CRA tracts,” or predominantly low-income and minority areas.

    To satisfy CRA examiners, “flexible” lending by large banks rose an average 5% and those loans defaulted about 15% more often, the 43-page study found.

    The strongest link between CRA lending and defaults took place in the runup to the crisis — 2004 to 2006 — when banks rapidly sold CRA mortgages for securitization by Fannie Mae and Freddie Mac and Wall Street.

    CRA regulations are at the core of Fannie’s and Freddie’s so-called affordable housing mission. In the early 1990s, a Democrat Congress gave HUD the authority to set and enforce (through fines) CRA-grade loan quotas at Fannie and Freddie.​


    Republicans warned Democrats of impending doom in 2004:
    ]


    http://www.thegatewaypundit.com/2012/12/new-study-finds-democrats-fully-to-blame-for-subprime-mortgage-crisis-that-caused-financial-collapse/
     
  2. Old Rocks
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    Old Rocks Diamond Member

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    LOL. Whee................ The fruitloops get nuttier every day.
     
  3. Papageorgio
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    Papageorgio The Ultimate Winner

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    There were so many reasons for the collapse of 2008 and BOTH parties were to blame, it went back to policies and laws since the Great Depression. We created a mess that should have imploded in 2001, but we found one last bubble to ride out and it lasted seven more years, be thankful it lasted as long as it did.
     
  4. Papageorgio
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    Papageorgio The Ultimate Winner

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    If you can't see that both democrats and republicans and their policies for decades created the 2008 mess, you are nothing but a nutty partisan dumb ass.
     
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  5. Dante
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    Private sector loans, not Fannie or Freddie, triggered crisis

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

    Another Conservative Myth Busted -- Did Fannie and Freddie Really Cause the Financial Sector Meltdown?

    Actually, if you bothered to pay any attention to

    "The strongest link between CRA lending and defaults took place in the runup to the crisis — 2004 to 2006 — when banks rapidly sold CRA mortgages for securitization by Fannie Mae and Freddie Mac and Wall Street."

    Read More At IBD: New Study Blames Community Reinvestment Act For Mortgage Defaults - Investors.com

    ---


    The One Hundred Ninth United States Congress was the legislative branch of the United States, composed of the United States Senate and the United States House of Representatives, from January 3, 2005 to January 3, 2007, during the fifth and sixth years of George W. Bush's presidency. House members were elected in the 2004 elections on November 4, 2004. Senators were elected in three classes in the 2000 elections on November 7, 2000, 2002 elections on November 5, 2002, or 2004 elections on November 4, 2004. The apportionment of seats in the House of Representatives was based on the Twenty-second Census of the United States in 2000. Both chambers had a Republican majority, the same party as President Bush.
    109th United States Congress - Wikipedia, the free encyclopedia

    ---

    In 2009 Frank responded to what he called "wholly inaccurate efforts by Republicans to blame Democrats, and [me] in particular" for the subprime mortgage crisis, which is linked to the financial crisis of 2007–2009.[52] He outlined his efforts to reform these institutions and add regulations, but met resistance from Republicans, with the main exception being a bill with Republican Mike Oxley that died because of opposition from President Bush.[52] The 2005 bill included Frank objectives, which were to impose tighter regulation of Fannie and Freddie and new funds for rental housing. Frank and Mike Oxley achieved broad bipartisan support for the bill in the Financial Services Committee, and it passed the House. But the Senate never voted on the measure, in part because President Bush was likely to veto it. "

    If it had passed, that would have been one of the ways we could have reined in the bowling ball going downhill called housing," Oxley told Frank. In an op-ed piece in the Wall Street Journal, Lawrence B. Lindsey, a former economic adviser to President George W. Bush, wrote that Frank "is the only politician I know who has argued that we needed tighter rules that intentionally produce fewer homeowners and more renters."[7] Once control shifted to the Democrats, Frank was able to help guide both the Federal Housing Reform Act (H.R. 1427) and the Mortgage Reform and Anti-Predatory Lending Act (H.R. 3915) to passage in 2007.[52] Frank also said that the Republican-led Gramm–Leach–Bliley Act of 1999, which repealed part of the Glass–Steagall Act of 1933 and removed the wall between commercial and investment banks, contributed to the financial meltdown.[52]

    Frank further stated that "during twelve years of Republican rule no reform was adopted regarding Fannie Mae and Freddie Mac. In 2007, a few months after I became the Chairman, the House passed a strong reform bill; we sought to get the [Bush] administration's approval to include it in the economic stimulus legislation in January 2008; and finally got it passed and onto President Bush's desk in July 2008. Moreover, "we were able to adopt it in nineteen months, and we could have done it much quicker if the [Bush] administration had cooperated."[53]

    Barney Frank - Wikipedia, the free encyclopedia
     
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  6. waltky
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    Goldman Sachs, Morgan Stanley, other banks may join subprime settlement...
    :cool:
    More banks may join Fed-led settlement
    Thu, Jan 10, 2013 - Goldman Sachs Group Inc, Morgan Stanley and two other banks may agree as soon as this week to settle claims over botched foreclosures in an accord similar to one reached with 10 other loan servicers, two people briefed on the discussions said.
     
  7. healthmyths
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    healthmyths Gold Member Supporting Member

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    YOU OLD FART!!!! Why is it so hard to understand REAlITY for you???

    HERE is just two quotes from Franks/Dodds!!!

    "Over the past six years, the President and his Administration have not only warned of the systemic consequences of failure to reform GSEs but also put forward thoughtful plans to reduce the risk that either Fannie Mae or Freddie Mac would encounter such difficulties. President Bush publicly called for GSE reform at least 17 times in 2008 alone before Congress acted. Unfortunately, these warnings went unheeded, as the President's repeated attempts to reform the supervision of these entities were thwarted by the legislative maneuvering of those who emphatically denied there were problems. Many prominent Democrats, including House Finance Chairman Barney Frank, opposed any legislation correcting the risks posed by GSEs.

    * House Financial Services Committee Chairman Barney Frank (D-MA) criticized
    the President's warning saying:
    "these two entities - Fannie Mae and Freddie Mac - are not facing any kind of financial crisis .The more people exaggerate these problems,
    the more pressure there is on these companies, the less we will see in terms of affordable housing.
    "
    ..
    (Stephen Labaton, "New Agency Proposed To Oversee Freddie Mac And Fannie
    Mae," New York Times, 9/11/03)

    * Senate Committee on Banking, Housing and Urban Affairs Chairman Christopher Dodd also ignored the President's warnings and called on him to "immediately reconsider his ill-advised" position. (Eric Dash, "Fannie Mae's Offer To Help Ease Credit Squeeze Is Rejected, As Critics Complain Of Opportunism," New York Times, 8/11/07)

    Now A recent study released 12/12/12..
    " We find that adherence to the act led to riskier lending by banks: in the six quarters surrounding the CRA exams lending is elevated on average by about 5 percent every quarter and loans in these quarters default by about 15 percent more often.
    These patterns are accentuated in CRA-eligible census tracts and are concentrated among large banks."
    New study concludes that the Community Reinvestment Act ‘clearly’ did lead to risky lending | AEIdeas

    AND idiots like you have NO idea what happened on 9/18/2008! All because dumbshits... like yOU get all your information from the totally biased MSM!!!
     
  8. bripat9643
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    That's exactly what a partisan Democrat would say when they get caught with their hands in the cookie jar.
     
  9. NYcarbineer
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  10. Clementine
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    You might want to watch the video, where in 2004, Republicans warned of an impending financial crisis and demanded more oversight and regulations, beginning with Fannie and Freddie. One Democrat after another stood up and blasted them, saying that if something isn't broke, you don't fix it and they claimed the whole effort to rein in the risky practices, specifically of F and F, was merely a political lynching of Franklin Raines. Raines ran the bank into the ground, then took off with millions in bonuses. He should be in jail, among others.

    The 2004 showdown wasn't the first. Warnings started coming in the 90's and they kept trying to to investigate, but were shut down by a bunch of yelling Democrats every time.
     

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