Not Just Bush's Fault: The Story Behind Clinton and the Glass-Steagall Act

[beretta304]

More than enough blame to sahre.

Q: Did Bill Clinton Repeal the Glass-Steagall Act?

A: No, but he signed into law the Gramm-Leach-Bliley Act, which repealed some of the provisions of the Glass-Steagall Act.

--

On November 12th, 1999, Bill Clinton signed into law the Gramm-Leach-Bliley Act, which repealed SOME of the provisions of the Glass-Steagall Act.

According to Wikipedia.org, "the repeal of provisions of the Glass-Steagall Act of 1933 by the Gramm-Leach-Bliley Act effectively removed the separation that previously existed between investment banking which issued securities and commercial banks which accepted deposits. The deregulation also removed conflict of interest prohibitions between investment bankers serving as officers of commercial banks."

and

"…The Glass-Steagall Act prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and an insurance company."

So, as a result of the Gramm-Leach-Bliley Act, a commercial bank would be able to buy an insurance company, or a commercial bank would be able to buy an investment bank, etc.

The three co-sponsors of the Gramm-Leach-Bliley Act were:

Sen. Phil Gramm - R
Rep. Jim Leach - R
Rep. Thomas J. Bliley, Jr. - R

In 1999, the Republicans held a majority in both the Senate and the House of Representatives.

The final version of the Gramm-Leach-Bliley Act passed the House by a vote of 362-57 and the Senate by a vote of 90-8. This made the bill "veto proof", meaning that if Clinton had decided to veto, the bill would have been passed anyways. Having said that, if Clinton truly didn't want the bill to become law, he could have vetoed the bill in a symbolic gesture, but this did not happen. Many people point to the Gramm-Leach-Bliley Act as a major reason why the financial sector imploded in 2008. When it comes to pointing fingers, both parties get the blame. The Gramm-Leach-Bliley Act was co-sponsored by three Republicans, signed into law by a Democratic president and had the overwhelming support of both parties when it was eventually passed.

 

[Truthseeker420]

And a Republican controlled congress.

 

[Freewill]

I think that anyone who is paying attention realizes the damage Clinton did to this country. First of all we have what you point out. If Clinton thought it wrong he could have rallied the democrats, or enough of them to make it not a veto proof majority. Moving from there we have Clinton signing the "free" trade agreements. Which, at the time, was predicted to have a great sucking sound of jobs leaving the country, and that prediction, unfortunately, has come true. Then we can move on to his handling of threats to our country. The first WTC bombing was handled as a criminal act. When attacked in Somalia what did the US do? We pulled out. When the Cole was attacked, which was a blatant act of war, what did we do militarily? Nothing. So is it a surprise to think that any attack on America would result in nothing happening? Bill Clinton's lack of action lead directly to 9/11 there is no doubt. Oh yeah I should mention that Clinton did blow up some tents in a desert some where.

 

[buckeye45_73]

And a Republican controlled congress.

Wait, so is it congress or the President? You seem to change based on the party in power.....

 

[Freewill]

And a Republican controlled congress.

The vote was bi-partisan or did you miss that point in your fail of a comeback?

 

[beretta304]

And a Republican controlled congress.

I see. So who controls Congress only matters when the blame is to be put on Republicans.

Fucking hypocrite!

 

[uscitizen]

I keep telling everyone that the foundation for this house of cards had been building for 3-4 decades.

 

[beretta304]

And a Republican controlled congress.

The vote was bi-partisan or did you miss that point in your fail of a comeback?

By Truthseekers logic, Obama is a failed President with no one but himself to blame since Dems controlled Congress and therefore he should have been able to get his way each and every time.

Instead he squandered it on Obamacare and did nothing about SS and Medicare/Medicaid.

 

[Seawytch]

President Clinton: I Was Wrong To Listen To Rubin and Summers On Derivatives

 

[zeke]

Why don't you dig a little deeper and find out who (outside of Congress) was actively supporting these changes, how much money were the outside influences pumping into the good Congresspeoples campaign coffers.

There was a reason the changes were sought. Repubs had been trying to get Glass Steagal repealed since it was put in place.


What is really funny is that us on the street mortgage loan officers knew this was a disaster in the making. We just didn't realize how much money was to be made. But when we found out, well the rush was on to find any living breathing person that could possible be saddled with crummy mortgage products.

Overcome by greed, history was made.

 

[Freewill]

And a Republican controlled congress.

The vote was bi-partisan or did you miss that point in your fail of a comeback?

By Truthseekers logic, Obama is a failed President with no one but himself to blame since Dems controlled Congress and therefore he should have been able to get his way each and every time.

Instead he squandered it on Obamacare and did nothing about SS and Medicare/Medicaid.

President Obama is a failed president because he had so much potential yet he let the opportunity slip through his hands to promote agenda. Certainly we had a huge economic hit in 2008 no one denies that. But what that meant is an opportunity for a big recovery which is what history has taught most of us. What Obama did was predicted by those on the right as not working, and we have obviously been proved correct. So he could have been a hero but ended up being a zero.

As for congress. For a full year congress was controlled by the democrats with a filibuster proof majority. Which means of course they could have done whatever they wanted. Which is what they did without giving GWB a head nod. That is about the same time that congress didn't even bother with a budget, why would they? In my opinion, having control of both Congress and the Presidency is dangerous and I think the results we see proves that point. It would be different if I were saying that and the economy was actually good, but it is not.

 

[TakeAStepBack]

Bill Clinton's drive to increase homeownership went way too far - BusinessWeek

Add President Clinton to the long list of people who deserve a share of the blame for the housing bubble and bust. A recently re-exposed document shows that his administration went to ridiculous lengths to increase the national homeownership rate. It promoted paper-thin downpayments and pushed for ways to get lenders to give mortgage loans to first-time buyers with shaky financing and incomes. It’s clear now that the erosion of lending standards pushed prices up by increasing demand, and later led to waves of defaults by people who never should have bought a home in the first place.

President Bush continued the practices because they dovetailed with his Ownership Society goals, and of course Congress was strongly behind the push. But Clinton and his administration must shoulder some of the blame.

In writing this blog entry, I’m following the lead of Joseph R. Mason, who is a finance professor at Drexel University’s LeBow College of Business, a senior fellow at the University of Pennsylvania’s Wharton School, and a consultant at Criterion Economics. Here is a link to a piece that he wrote on Feb. 26.

The Clinton-era document that Mason cites—“The National Homeownership Strategy: Partners in the American Dream”—was hiding in plain sight

on the website of the Department of Housing & Urban Development until last year, when according to Mason it was removed (probably because the housing bust made it seem embarrassing to the department). Mason credits Joshua Rosner of Graham Fisher & Co. with saving a copy of it before it was expunged.

The National Homeownership Strategy began in 1994 when Clinton directed HUD Secretary Henry Cisneros to come up with a plan, and Cisneros convened what HUD called a "historic meeting" of private and public housing-industry organizations in August 1994. The group eventually produced a plan, of which Mason sent me a PDF of Chapter 4, the one that argues for creative measures to promote homeownership.

The very worst idea in the plan, which fortunately never gained approval, was to let first-time homebuyers freely tap their IRA and 401(k) retirement-savings plans with no penalty to scrounge up a downpayment. That, HUD estimated, would have "benefited" 600,000 families in the first five years.

Plenty of other ideas in the plan did become reality, though. Knowing what we know now about the housing bust, the earnest language in the document seems faintly ridiculous. Here's an excerpt. Read it closely and you can see the seeds of disaster being planted:

For many potential homebuyers, the lack of cash available to accumulate the required downpayment and closing costs is the major impediment to purchasing a home. Other households do not have sufficient available income to to make the monthly payments on mortgages financed at market interest rates for standard loan terms. Financing strategies, fueled by the creativity and resources of the private and public sectors, should address both of these financial barriers to homeownership.

Both parties and the federal reserve can take full responsibility for the financial collapse. The repeal Clinton instilled was done to push the National Homeownership Strategy: Partners in the American Dream.

Yet, many still blame wall st. for the meltdown. It's totally misplaced blame.

 

[Freewill]

Why don't you dig a little deeper and find out who (outside of Congress) was actively supporting these changes, how much money were the outside influences pumping into the good Congresspeoples campaign coffers.

There was a reason the changes were sought. Repubs had been trying to get Glass Steagal repealed since it was put in place.


What is really funny is that us on the street mortgage loan officers knew this was a disaster in the making. We just didn't realize how much money was to be made. But when we found out, well the rush was on to find any living breathing person that could possible be saddled with crummy mortgage products.

Overcome by greed, history was made.

And if that is what happened then you all should either be in jail or in poverty, not bailed out.

 

[Truthseeker420]

And a Republican controlled congress.

Wait, so is it congress or the President? You seem to change based on the party in power.....

WTF? when have I changed anything?

 

[Claudette]

Bill Clinton's drive to increase homeownership went way too far - BusinessWeek

Add President Clinton to the long list of people who deserve a share of the blame for the housing bubble and bust. A recently re-exposed document shows that his administration went to ridiculous lengths to increase the national homeownership rate. It promoted paper-thin downpayments and pushed for ways to get lenders to give mortgage loans to first-time buyers with shaky financing and incomes. It’s clear now that the erosion of lending standards pushed prices up by increasing demand, and later led to waves of defaults by people who never should have bought a home in the first place.

President Bush continued the practices because they dovetailed with his Ownership Society goals, and of course Congress was strongly behind the push. But Clinton and his administration must shoulder some of the blame.

In writing this blog entry, I’m following the lead of Joseph R. Mason, who is a finance professor at Drexel University’s LeBow College of Business, a senior fellow at the University of Pennsylvania’s Wharton School, and a consultant at Criterion Economics. Here is a link to a piece that he wrote on Feb. 26.

The Clinton-era document that Mason cites—“The National Homeownership Strategy: Partners in the American Dream”—was hiding in plain sight

on the website of the Department of Housing & Urban Development until last year, when according to Mason it was removed (probably because the housing bust made it seem embarrassing to the department). Mason credits Joshua Rosner of Graham Fisher & Co. with saving a copy of it before it was expunged.

The National Homeownership Strategy began in 1994 when Clinton directed HUD Secretary Henry Cisneros to come up with a plan, and Cisneros convened what HUD called a "historic meeting" of private and public housing-industry organizations in August 1994. The group eventually produced a plan, of which Mason sent me a PDF of Chapter 4, the one that argues for creative measures to promote homeownership.

The very worst idea in the plan, which fortunately never gained approval, was to let first-time homebuyers freely tap their IRA and 401(k) retirement-savings plans with no penalty to scrounge up a downpayment. That, HUD estimated, would have "benefited" 600,000 families in the first five years.

Plenty of other ideas in the plan did become reality, though. Knowing what we know now about the housing bust, the earnest language in the document seems faintly ridiculous. Here's an excerpt. Read it closely and you can see the seeds of disaster being planted:

For many potential homebuyers, the lack of cash available to accumulate the required downpayment and closing costs is the major impediment to purchasing a home. Other households do not have sufficient available income to to make the monthly payments on mortgages financed at market interest rates for standard loan terms. Financing strategies, fueled by the creativity and resources of the private and public sectors, should address both of these financial barriers to homeownership.

Both parties and the federal reserve can take full responsibility for the financial collapse. The repeal Clinton instilled was done to push the National Homeownership Strategy: Partners in the American Dream.

Yet, many still blame wall st. for the meltdown. It's totally misplaced blame.

Yup and it wasn't all Bush's fault.

 

[Sallow]

The effects of the Gramm-Leach-Bliley Act were felt early into the Bush administration with the Arthur Anderson debacle. Bush could have easily made the case that this was detrimental to the economy as a whole. Instead, he watched financial after financial collapse and helped cobble together deals that ultimately cost the average tax payer big. And the final collapse was the culmination of one of the biggest examples of vulture capitalism or the fleecing of the middle class.

It all happened, spectacularly, on Bush's watch..who used his acumen as a CEO to gain office.

Sound familar?

 

[Freewill]

Bill Clinton's drive to increase homeownership went way too far - BusinessWeek

Add President Clinton to the long list of people who deserve a share of the blame for the housing bubble and bust. A recently re-exposed document shows that his administration went to ridiculous lengths to increase the national homeownership rate. It promoted paper-thin downpayments and pushed for ways to get lenders to give mortgage loans to first-time buyers with shaky financing and incomes. It’s clear now that the erosion of lending standards pushed prices up by increasing demand, and later led to waves of defaults by people who never should have bought a home in the first place.

President Bush continued the practices because they dovetailed with his Ownership Society goals, and of course Congress was strongly behind the push. But Clinton and his administration must shoulder some of the blame.

In writing this blog entry, I’m following the lead of Joseph R. Mason, who is a finance professor at Drexel University’s LeBow College of Business, a senior fellow at the University of Pennsylvania’s Wharton School, and a consultant at Criterion Economics. Here is a link to a piece that he wrote on Feb. 26.

The Clinton-era document that Mason cites—“The National Homeownership Strategy: Partners in the American Dream”—was hiding in plain sight

on the website of the Department of Housing & Urban Development until last year, when according to Mason it was removed (probably because the housing bust made it seem embarrassing to the department). Mason credits Joshua Rosner of Graham Fisher & Co. with saving a copy of it before it was expunged.

The National Homeownership Strategy began in 1994 when Clinton directed HUD Secretary Henry Cisneros to come up with a plan, and Cisneros convened what HUD called a "historic meeting" of private and public housing-industry organizations in August 1994. The group eventually produced a plan, of which Mason sent me a PDF of Chapter 4, the one that argues for creative measures to promote homeownership.

The very worst idea in the plan, which fortunately never gained approval, was to let first-time homebuyers freely tap their IRA and 401(k) retirement-savings plans with no penalty to scrounge up a downpayment. That, HUD estimated, would have "benefited" 600,000 families in the first five years.

Plenty of other ideas in the plan did become reality, though. Knowing what we know now about the housing bust, the earnest language in the document seems faintly ridiculous. Here's an excerpt. Read it closely and you can see the seeds of disaster being planted:

For many potential homebuyers, the lack of cash available to accumulate the required downpayment and closing costs is the major impediment to purchasing a home. Other households do not have sufficient available income to to make the monthly payments on mortgages financed at market interest rates for standard loan terms. Financing strategies, fueled by the creativity and resources of the private and public sectors, should address both of these financial barriers to homeownership.

Both parties and the federal reserve can take full responsibility for the financial collapse. The repeal Clinton instilled was done to push the National Homeownership Strategy: Partners in the American Dream.

Yet, many still blame wall st. for the meltdown. It's totally misplaced blame.

Are you saying that the greedy on Wall Street didn't take advantage of the changes to the demise of the country? No harm to them they were bailed out, but the people, the average Joe?

 

[buckeye45_73]

I still like this one
[ame=http://www.youtube.com/watch?v=Lr1M1T2Y314]How The Democrats Caused The Financial Crisis: Starring Bill Clinton's HUD Secretary Andrew Cuomo And Barack Obama; With Special Guest Appearances By Bill Clinton And Jimmy Carter - YouTube[/ame]

 

[Sallow]

Bill Clinton's drive to increase homeownership went way too far - BusinessWeek

Add President Clinton to the long list of people who deserve a share of the blame for the housing bubble and bust. A recently re-exposed document shows that his administration went to ridiculous lengths to increase the national homeownership rate. It promoted paper-thin downpayments and pushed for ways to get lenders to give mortgage loans to first-time buyers with shaky financing and incomes. It’s clear now that the erosion of lending standards pushed prices up by increasing demand, and later led to waves of defaults by people who never should have bought a home in the first place.

President Bush continued the practices because they dovetailed with his Ownership Society goals, and of course Congress was strongly behind the push. But Clinton and his administration must shoulder some of the blame.

In writing this blog entry, I’m following the lead of Joseph R. Mason, who is a finance professor at Drexel University’s LeBow College of Business, a senior fellow at the University of Pennsylvania’s Wharton School, and a consultant at Criterion Economics. Here is a link to a piece that he wrote on Feb. 26.

The Clinton-era document that Mason cites—“The National Homeownership Strategy: Partners in the American Dream”—was hiding in plain sight

on the website of the Department of Housing & Urban Development until last year, when according to Mason it was removed (probably because the housing bust made it seem embarrassing to the department). Mason credits Joshua Rosner of Graham Fisher & Co. with saving a copy of it before it was expunged.

The National Homeownership Strategy began in 1994 when Clinton directed HUD Secretary Henry Cisneros to come up with a plan, and Cisneros convened what HUD called a "historic meeting" of private and public housing-industry organizations in August 1994. The group eventually produced a plan, of which Mason sent me a PDF of Chapter 4, the one that argues for creative measures to promote homeownership.

The very worst idea in the plan, which fortunately never gained approval, was to let first-time homebuyers freely tap their IRA and 401(k) retirement-savings plans with no penalty to scrounge up a downpayment. That, HUD estimated, would have "benefited" 600,000 families in the first five years.

Plenty of other ideas in the plan did become reality, though. Knowing what we know now about the housing bust, the earnest language in the document seems faintly ridiculous. Here's an excerpt. Read it closely and you can see the seeds of disaster being planted:

For many potential homebuyers, the lack of cash available to accumulate the required downpayment and closing costs is the major impediment to purchasing a home. Other households do not have sufficient available income to to make the monthly payments on mortgages financed at market interest rates for standard loan terms. Financing strategies, fueled by the creativity and resources of the private and public sectors, should address both of these financial barriers to homeownership.

Both parties and the federal reserve can take full responsibility for the financial collapse. The repeal Clinton instilled was done to push the National Homeownership Strategy: Partners in the American Dream.

Yet, many still blame wall st. for the meltdown. It's totally misplaced blame.

Yup and it wasn't all Bush's fault.

Sure it was.

 

[Freewill]

The effects of the Gramm-Leach-Bliley Act were felt early into the Bush administration with the Arthur Anderson debacle. Bush could have easily made the case that this was detrimental to the economy as a whole. Instead, he watched financial after financial collapse and helped cobble together deals that ultimately cost the average tax payer big. And the final collapse was the culmination of one of the biggest examples of vulture capitalism or the fleecing of the middle class.

It all happened, spectacularly, on Bush's watch..who used his acumen as a CEO to gain office.

Sound familar?

Actually the President doesn't make law. The disaster happened under democrat control. Bush warned them, they did nothing. Not that they were looking the other way they were just too incompetent and too stuck to ideology to see the dangers. If you want I will post the video of the things that the democrats said to the regulators as the house of cards was starting to fall. And I am not even saying that if it were a Republican controlled congress things would have happened differently. They may have because Republicans saw the dangers but who knows? All we can know is what actually happened and when.