Why was the economy in "free-fall" 4 years ago?

Discussion in 'Politics' started by Calsside, Sep 21, 2012.

  1. Calsside
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    Calsside Rookie

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    I heard about Bill Clinton saying this at the DNC. I thought that this was very ironic of him to say this, as if it was Bush's fault, when it was actually mostly caused by what happend during the Clinton Admistration years. The Community Reinvestment Act being ramped up and the removal of the Glass-Spiegal Act are the real causes of our current bad economy. If the Republicans don't explain this clearly, out in the open, they will lose a big opportunity to gain ground.
     
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  2. CrusaderFrank
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    CrusaderFrank Diamond Member

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    I had a meeting with a banker who told us that CRA regulators and regulations are intentionally vague to give the government maximum leverage over the banks.

    That's a comforting thought
     
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  3. Mac1958
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    Mac1958 Platinum Member

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    The meltdown was cultural in DNA and decades in the making.

    .
     
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  4. healthmyths
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    healthmyths Gold Member Supporting Member

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    NO.. it was a simple Motor Voter application By democrats.
    Give UNQUALIFIED people loans (See ACORN/CitiBank)

    1) Before 1995 home loans were made to people that could make the mortgage payments.
    In these lawsuits, ACORN makes a bogus claim of Redlining (denying poor people loans because of their ethnic heritage).
    They protest and get the local media to raise a big stink.
    This stink means that the bank faces thousands of people closing their accounts and get local politicians to lobby to stop the bank from doing some future business, expansions and mergers.
    ACORN filed tons of these lawsuits and ALL of them allege racism.
    UPDATED: Obama Sued Citibank Under CRA to Force it to Make Bad Loans | Media Circus

    Lawyers among was Obama.. settled out of court.

    So Now banks had to make loans!
    BUT FDIC said we'll close you cause loans are poor quality!
    Banks re-packaged and sold with Fannie/Freddie Using CDswaps banks could unload the sub-prime loans by having Fannie/Freddie securitizing them as explained in this statement:
    Oct. 23,2008 (Bloomberg) -- Fannie Mae and Freddie Mac have an ``effective'' federal guarantee, not the "full faith and credit'' of the U.S. government, Federal Housing Finance Agency Director James Lockhart said after the hearing. That does give them effectively a guarantee of the U.S. government.''
    Lockhart's Fannie, Freddie Guarantee Remarks Stir Up Confusion - Bloomberg

    So now we have poor loans guaranteed by Federal Govt... which it turned out to be TRUE!
    Major hickup occurred when AND you know NOT many people address this Economic Terrorist Attack that occurred and CAUSED all the financial meltdowns with bank loans in foreclosure,etc...

    3) AND YOU HAVE NO idea of what happened on 9/18/2008...

    The near economic collapse on Thursday (Sept 18,2008), at 11am the Federal Reserve noticed a tremendous draw-down of money market accounts in the U.S., to the tune of $550 billion was being drawn out in the matter of an hour or two. The Treasury opened up its window to help and pumped a $105 billion in the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks. They decided to close the operation, close down the money accounts and announce a guarantee of $250,000 per account so there wouldn’t be further panic out there. If they had not done that, their estimation is that by 2pm that afternoon, $5.5 trillion would have been drawn out of the money market system of the U.S., would have collapsed the entire economy of the U.S., and within 24 hours the world economy would have collapsed.
    It would have been the end of our economic system and our political system as we know it.

    Zero Hedge: How The World Almost Came To An End At 2PM On September 18

    In summary Democrats wanting more voters like Motor Voter, encouraged through protests banks make subprime loans.
    Loans called by FDIC toxic so banks re-sell and Government guarantees!
    With 9/18/08 economic terrorist attack almost financial collapse!
     
  5. Mr. Peepers
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    Mr. Peepers Senior Member

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  6. Mr. Peepers
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    Mr. Peepers Senior Member

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    The loan qualifications were lessened because Wall Street was begging the Bush administration and the lenders for more and more loans to bundle. The banks & traders were making money and the lenders were making money. They knew what they were doing was wrong, but they didn't care. They knew that we would be on the hook if anything went wrong. And we were.

    http://www.newyorkfed.org/research/epr/12v18n2/1207bord.pdf
     
  7. CrusaderFrank
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    CrusaderFrank Diamond Member

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    Fannie and Freddie cause the collapse.

    True story

    They gave AAA rating to "No Income No Asset" Loans
     
  8. RDD_1210
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    RDD_1210 Forms his own opinions

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    Link?
     
  9. Toro
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    Toro Diamond Member

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    The GSEs don't give out ratings, Frank.
     
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  10. Mac1958
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    It was a little more complicated than something "those guys did".

    Good gawd.

    .
     

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