“I Cannot Afford To Live”: Americans Get Emotional As The U.S. Economy Goes Off The Rails

[AntonToo]

So now let's go look at the facts, not just what you claim.

Bear Stearns, the CRA, and Freddie Mac - Cafe Hayek

I keep hearing that the subprime crisis was caused by people willing to buy stuff they couldn't evaluate. Why would smart people do that? One answer is that they were stupid. In an era of rising home prices, it's hard...

cafehayek.com

The $384.6 million in senior certificates are guaranteed by Freddie Mac and have an implied "AAA" rating. First Union Capital Markets Corp. is the investment banking subsidiary of First Union Corporation.

Freddie gave sub-prime mortgage backed securities a "AAA" rating by guaranteeing them.

You claim no one gave them a "AAA" rating.

Freddie Mac itself gave them a "AAA" rating by guaranteeing them.

Freddie Mac guaranteed sub-prime mortgage backed securities, giving them a "AAA" rating.

That is not up for debate. That is exactly what happened. If that did not happen, then Freddie Mac should have sued First Union for false advertising.

Did that happen in 1997? No it did not. They did not sue them for falsely saying that these sub-prime MBS were guaranteed and had a "AAA" rating.

So, you can keep saying these lies, but I'm going to keep posting the facts EVERY SINGLE TIME.

So back to you. Keep going. I'll be right here.

Dummy, SECURITIES were rated AAA, because they had high % of high quality loans to offset low quality loan risk. Sub-prime mortgages themselves were never rated as AAA. You don't seem to understand the concept.

Are you going to actually address my posting or not?

HERE IT IS AGAIN:

Yes GSE's AAA rated securities that mixed in sub-prime mortgages eventually contributed to the problem, because they weren't ACTUALLY AAA risk grade, which is, again, a risk management failure that happened at every level.

You want to put some blame on Clinton admin? Sure ok, but when at the same time you give Bush admin a full pass for not only not fixing anything in 7 years leading up to the collapse, but actively pushing for EXPANDING GSE's sub-prime holdings (among all the other Home Ownership and deregulation policies) you just show your hand as just another tribalist politico with no interest for any sort of objectivity.


Try READING and UNDERSTANDING that BEFORE replying.

 

[Andylusion]

So if you argued that they were paying their fair share before Trump, how can you argue now they are still paying their fair share?

That's an interesting question. You are implying that fair share is a static amount of money, and that tax rates directly relate to a static amount of money.

They don't.

When you jack up the tax rate, people move their income and assets to avoid the tax.
Again, the top marginal tax rate in 1980 was 70%. The top marginal rate in the 2000s was 39%.

If tax rates directly related to tax revenue, then the rich should have been paying 40% of all taxes in 1980, and 20% in the 2000s.
Instead it was the reverse.

In 1980 the top 1% only paid 20% of taxes, and by late 2000s was paying 40% of all taxes.

The higher the tax rate, the fewer people will pay it.

As for fair share, they have always paid more than their fair share. 1% of the working population, is paying 40% of all taxes, or 20% of all taxes, both is the rich paying vastly more than their fair share.

This is Atlas Shrugged. Think about that. 1% of not the total population of the country... 1% of wage earners in this country, are paying 40% of the tax burden of EVERYONE.

 

[Andylusion]

Dummy, SECURITIES were rated AAA, because they had high % of high quality loans to offset low quality loan risk. Sub-prime mortgages themselves were never rated as AAA. You don't seem to understand the concept.

Are you going to actually address my posting or not?

HERE IT IS AGAIN:

Yes GSE's AAA rated securities that mixed in sub-prime mortgages eventually contributed to the problem, because they weren't ACTUALLY AAA risk grade, which is, again, a risk management failure that happened at every level.

You want to put some blame on Clinton admin? Sure ok, but when at the same time you give Bush admin a full pass for not only not fixing anything in 7 years leading up to the collapse, but actively pushing for EXPANDING GSE's sub-prime holdings (among all the other Home Ownership and deregulation policies) you just show your hand as just another tribalist politico with no interest for any sort of objectivity.


Try READING and UNDERSTANDING that BEFORE replying.

Again, Freddie Mac gave sub-prime mortgage backed securities a "AAA" rating by guaranteeing them.
You can keep repeating that, and I'll keep repeating that they did this. And I proved with clear documented evidence.

because they had high % of high quality loans to offset low quality loan risk"

Well obviously they didn't, because the GSEs were the biggest bailout of the entire sub-prime crash.

If they offset the risk, then why were the GSEs the biggest failures of the entire crash?

Because they were sub-prime loans, that the GSEs claimed were safe, and were not.

 

[Markle]

You don't know whatyou are talking about, failures were primarily in private unregulated loan originations not under ARA program that actually had underwriting standards.

To say that Bush, a president with national Home Ownership expansion and market deregulation policies, had nothing to with it, while blaming a community organizer in Chicago is some next level partisan horseshit.

For many years the President and his Administration not only warned of the systemic consequences of financial turmoil at a housing government-sponsored enterprise (GSE) 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 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.

2001
April: The Administration’s FY02 budget declares that the size of Fannie Mae and Freddie Mac is “a potential problem,” because “financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity.”

2002
May: The President calls for the disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac. (OMB Prompt Letter to OFHEO, 5/29/02)

2003
January: Freddie Mac announces it has to restate financial results for the previous three years. [Obama advisor, Franklin Raines was CEO of Freddie Mac when they lied about earnings to increase bonuses]

February: The Office of Federal Housing Enterprise Oversight (OFHEO) releases a report explaining that “although investors perceive an implicit Federal guarantee of [GSE] obligations,” “the government has provided no explicit legal backing for them.” As a consequence, unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market. (“Systemic Risk: Fannie Mae, Freddie Mac and the Role of OFHEO,” OFHEO Report, 2/4/03).

September: Fannie Mae discloses SEC investigation and acknowledges OFHEO’s review found earnings manipulations.

September: Treasury Secretary John Snow testifies before the House Financial Services Committee to recommend that Congress enact “legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises” and set prudent and appropriate minimum capital adequacy requirements.

October: Fannie Mae discloses $1.2 billion accounting error.

November: Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any “legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk.” To reduce the potential for systemic instability, the regulator would have “broad authority to set both risk-based and minimum capital standards” and “receivership powers necessary to wind down the affairs of a troubled GSE.” (N. Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03).

2004
February: The President’s FY05 Budget again highlights the risk posed by the explosive growth of the GSEs and their low levels of required capital, and called for creation of a new, world-class regulator: “The Administration has determined that the safety and soundness regulators of the housing GSEs lack sufficient power and stature to meet their responsibilities, and therefore…should be replaced with a new strengthened regulator.” (2005 Budget Analytic Perspectives, pg. 83)

February: CEA Chairman Mankiw cautions Congress to “not take [the financial market's] strength for granted.” Again, the call from the Administration was to reduce this risk by “ensuring that the housing GSEs are overseen by an effective regulator.” (N. Gregory Mankiw, Op-Ed, “Keeping Fannie And Freddie’s House In Order,” Financial Times, 2/24/04).

June: Deputy Secretary of Treasury Samuel Bodman spotlights the risk posed by the GSEs and called for reform, saying “We do not have a world-class system of supervision of the housing government sponsored enterprises (GSEs), even though the importance of the housing financial system that the GSEs serve demands the best in supervision to ensure the long-term vitality of that system. Therefore, the Administration has called for a new, first class, regulatory supervisor for the three housing GSEs: Fannie Mae, Freddie Mac, and the Federal Home Loan Banking System.” (Samuel Bodman, House Financial Services Subcommittee on Oversight and Investigations Testimony, 6/16/04).

2005
April: Treasury Secretary John Snow repeats his call for GSE reform, saying “Events that have transpired since I testified before this Committee in 2003 reinforce concerns over the systemic risks posed by the GSEs and further highlight the need for real GSE reform to ensure that our housing finance system remains a strong and vibrant source of funding for expanding homeownership opportunities in America… Half-measures will only exacerbate the risks to our financial system.” (Secretary John W. Snow, “Testimony Before The U.S. House Financial Services Committee,” 4/13/05).

2007
July: Two Bear Stearns hedge funds invested in mortgage securities collapse.

August: President Bush emphatically calls on Congress to pass a reform package for Fannie Mae and Freddie Mac, saying “first things first when it comes to those two institutions. Congress needs to get them reformed, get them streamlined, get them focused, and then I will consider other options.” (President George W. Bush, Press Conference, The White House, 8/9/07).

September: RealtyTrac announces foreclosure filings up 243,000 in August – up 115 percent from the year before.

September: Single-family existing home sales decreases 7.5 percent from the previous month – the lowest level in nine years. Median sale price of existing homes fell six percent from the year before.

December: President Bush again warns Congress of the need to pass legislation reforming GSEs, saying “These institutions provide liquidity in the mortgage market that benefits millions of homeowners, and it is vital they operate safely and operate soundly. So I’ve called on Congress to pass legislation that strengthens independent regulation of the GSEs – and ensures they focus on their important housing mission. The GSE reform bill passed by the House earlier this year is a good start. But the Senate has not acted. And the United States Senate needs to pass this legislation soon.” (President George W. Bush, Discusses Housing, The White House, 12/6/07).

2008
January: Bank of America announces it will buy Countrywide.

January: Citigroup announces mortgage portfolio lost $18.1 billion in value.

February: Assistant Secretary David Nason reiterates the urgency of reforms, says “A new regulatory structure for the housing GSEs is essential if these entities are to continue to perform their public mission successfully.” (David Nason, Testimony On Reforming GSE Regulation, Senate Committee On Banking, Housing And Urban Affairs, 2/7/08).

March: Bear Stearns announces it will sell itself to JPMorgan Chase.

March: President Bush calls on Congress to take action and “move forward with reforms on Fannie Mae and Freddie Mac. They need to continue to modernize the FHA, as well as allow State housing agencies to issue tax-free bonds to homeowners to refinance their mortgages.” (President George W. Bush, Remarks To The Economic Club Of New York, New York, NY, 3/14/08).

April: President Bush urges Congress to pass the much needed legislation and “modernize Fannie Mae and Freddie Mac. [There are] constructive things Congress can do that will encourage the housing market to correct quickly by … helping people stay in their homes.” (President George W. Bush, Meeting With Cabinet, the White House, 4/14/08).

May: President Bush issues several pleas to Congress to pass legislation reforming Fannie Mae and Freddie Mac before the situation deteriorates further.

· “Americans are concerned about making their mortgage payments and keeping their homes. Yet Congress has failed to pass legislation I have repeatedly requested to modernize the Federal Housing Administration that will help more families stay in their homes, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance sub-prime loans.” (President George W. Bush, Radio Address, 5/3/08).

· “[T]he government ought to be helping creditworthy people stay in their homes. And one way we can do that – and Congress is making progress on this – is the reform of Fannie Mae and Freddie Mac. That reform will come with a strong, independent regulator.” (President George W. Bush, Meeting With The Secretary Of The Treasury, the White House, 5/19/08).

· “Congress needs to pass legislation to modernize the Federal Housing Administration, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance subprime loans.” (President George W. Bush, Radio Address, 5/31/08).

June: As foreclosure rates continued to rise in the first quarter, the President once again asks Congress to take the necessary measures to address this challenge, saying “we need to pass legislation to reform Fannie Mae and Freddie Mac.” (President George W. Bush, Remarks At Swearing In Ceremony For Secretary Of Housing And Urban Development, Washington, D.C., 6/6/08).

July: Congress heeds the President’s call for action and passes reform of Fannie Mae and Freddie Mac as it becomes clear that the institutions are failing.

Dummy did they tell you on FOX about Trump spending, current causes of record low unemployment, strong GDP and wage growth?

Yes, America shut down all businesses, causing massive unemployment. Congress passed, and President Trump signed the $2.2 TRILLION CARES ACT on March 17, 2020.

Then...

 

[AntonToo]

If they offset the risk, then why were the GSEs the biggest failures of the entire crash?

GSEs are highly leveraged by their very nature. Half of all outstanding real estate debt was held by GSE securities, given that volume of course there would be correspondingly large loss.

Can you actually show that their loss rates were worse then the rest of securitized mortgage market?

 

[AntonToo]

President Trump signed the $2.2 TRILLION CARES ACT on March 17, 2020.

So 2.2 Trillion. Thats it? you can think of no apropriation bill Trump signed? Nothing?

Strange considering everything you listed for Biden.

 

[sealybobo]

That's an interesting question. You are implying that fair share is a static amount of money, and that tax rates directly relate to a static amount of money.

They don't.

When you jack up the tax rate, people move their income and assets to avoid the tax.
Again, the top marginal tax rate in 1980 was 70%. The top marginal rate in the 2000s was 39%.

If tax rates directly related to tax revenue, then the rich should have been paying 40% of all taxes in 1980, and 20% in the 2000s.
Instead it was the reverse.

View attachment 932993
In 1980 the top 1% only paid 20% of taxes, and by late 2000s was paying 40% of all taxes.

The higher the tax rate, the fewer people will pay it.

As for fair share, they have always paid more than their fair share. 1% of the working population, is paying 40% of all taxes, or 20% of all taxes, both is the rich paying vastly more than their fair share.

This is Atlas Shrugged. Think about that. 1% of not the total population of the country... 1% of wage earners in this country, are paying 40% of the tax burden of EVERYONE.

Seems like fuzzy math. Not buying it.

The top 20% pay 90% of the taxes because they make 90% of the money. Give the bottom 50% half the money and they'll pay half the taxes.

If you are going to have a society where the only taxes are sales taxes, then you have to put more money in the consumers hands right?

 

[Harpy Eagle]

In 1980 the top 1% only paid 20% of taxes, and by late 2000s was paying 40% of all taxes.

That is because by the last 2000s the top 1% had their wages growing faster than the rest.

Between 1979 and 2019 the top 1.0% saw their wages grow by 160% while those in the bottom 90% had annual wages grow by 26.0%

 

[leftwinger]

That is because by the last 2000s the top 1% had their wages growing faster than the rest.

Between 1979 and 2019 the top 1.0% saw their wages grow by 160% while those in the bottom 90% had annual wages grow by 26.0%

Another lowIQ blackbacked ape chirping about unfair...tax the rich.....yet again year 12 of Obiden and nothing changes? nothing done about any of it, you dumb OX.

 

[Markle]

CEO pay in the US has grown 1,322% since 1978, according to the Economic Policy Institute. Such astronomical CEO pay is a very American problem. Not only do American CEOs far out-earn their workforces, they also out-earn their peers in other countries.

Connect the dots. In that same time, union membership went from 35% of our workforce down to 5%. So when labor lost it's seat at the table, the middle class stopped getting raises.

Why aren't corporations in America being more generous?

Send a thank you note to former President Bill Clinton for the explosion of pay packages for CEOs.

As you know, too, unions have outlived their purpose. Public service unions should never have been allowed. Even FDR knew that.

Please tell us specifically the source of each dollar a corporation pays in taxes.

 

[Markle]

That is because by the last 2000s the top 1% had their wages growing faster than the rest.

Between 1979 and 2019 the top 1.0% saw their wages grow by 160% while those in the bottom 90% had annual wages grow by 26.0%

 

[Harpy Eagle]

Sorry about that.

Wages for the top 1% skyrocketed 160% since 1979 while the share of wages for the bottom 90% shrunk: Time to remake wage pattern with economic policies that generate robust wage-growth for vast majority

Newly available wage data tell a familiar story: In every period since 1979, wages for the bottom 90% were continuously redistributed upward to the top 10% and frequently to the very highest 1.0% and 0.1%. This unceasing growth of wage inequality that undercuts wage growth for the bottom 90%...

www.epi.org

 

[Markle]

Yes GSE's AAA rated securities that mixed in sub-prime mortgages eventually contributed to the problem, because they weren't ACTUALLY AAA risk grade, which is, again, a risk management failure that happened at every level.

April 3, 1998. After announcing billions in fines via CRA Andrew Cuomo is bold in pride that CRA would be abused to force banks to give bad loans.







The Democrats and Obama caused the financial crisis of 08 by supporting Fannie Mae and Freddie Mac

Embedded media from this media site is no longer available

Don't Regulate Fannie Mae or Freddy Mac [Franklin Raines was fined and Fannie Mae fined $400 million]



UPDATED: Obama Sued Citibank Under CRA to Force it to Make Bad Loans

http://www.mediacircus.com/2008/10/obama-sued-citibank-under-cra-to-force-it-to-make-bad-loans/

You want to put some blame on Clinton admin? Sure ok, but when at the same time you give Bush admin a full pass for not only not fixing anything in 7 years leading up to the collapse, but actively pushing for EXPANDING GSE's sub-prime holdings (among all the other Home Ownership and deregulation policies) you just show your hand as just another tribalist politico with no interest for any sort of objectivity.

Here is what President Bush attempted to do and was blocked by Democrats.

For many years the President and his Administration not only warned of the systemic consequences of financial turmoil at a housing government-sponsored enterprise (GSE) 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 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.

2001
April: The Administration’s FY02 budget declares that the size of Fannie Mae and Freddie Mac is “a potential problem,” because “financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity.”

2002
May: The President calls for the disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac. (OMB Prompt Letter to OFHEO, 5/29/02)

2003
January: Freddie Mac announces it has to restate financial results for the previous three years. [Obama advisor, Franklin Raines was CEO of Freddie Mac when they lied about earnings to increase bonuses]

February: The Office of Federal Housing Enterprise Oversight (OFHEO) releases a report explaining that “although investors perceive an implicit Federal guarantee of [GSE] obligations,” “the government has provided no explicit legal backing for them.” As a consequence, unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market. (“Systemic Risk: Fannie Mae, Freddie Mac and the Role of OFHEO,” OFHEO Report, 2/4/03).

September: Fannie Mae discloses SEC investigation and acknowledges OFHEO’s review found earnings manipulations.

September: Treasury Secretary John Snow testifies before the House Financial Services Committee to recommend that Congress enact “legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises” and set prudent and appropriate minimum capital adequacy requirements.

October: Fannie Mae discloses $1.2 billion accounting error.

November: Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any “legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk.” To reduce the potential for systemic instability, the regulator would have “broad authority to set both risk-based and minimum capital standards” and “receivership powers necessary to wind down the affairs of a troubled GSE.” (N. Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03).

2004
February: The President’s FY05 Budget again highlights the risk posed by the explosive growth of the GSEs and their low levels of required capital, and called for creation of a new, world-class regulator: “The Administration has determined that the safety and soundness regulators of the housing GSEs lack sufficient power and stature to meet their responsibilities, and therefore…should be replaced with a new strengthened regulator.” (2005 Budget Analytic Perspectives, pg. 83)

February: CEA Chairman Mankiw cautions Congress to “not take [the financial market's] strength for granted.” Again, the call from the Administration was to reduce this risk by “ensuring that the housing GSEs are overseen by an effective regulator.” (N. Gregory Mankiw, Op-Ed, “Keeping Fannie And Freddie’s House In Order,” Financial Times, 2/24/04).

June: Deputy Secretary of Treasury Samuel Bodman spotlights the risk posed by the GSEs and called for reform, saying “We do not have a world-class system of supervision of the housing government sponsored enterprises (GSEs), even though the importance of the housing financial system that the GSEs serve demands the best in supervision to ensure the long-term vitality of that system. Therefore, the Administration has called for a new, first class, regulatory supervisor for the three housing GSEs: Fannie Mae, Freddie Mac, and the Federal Home Loan Banking System.” (Samuel Bodman, House Financial Services Subcommittee on Oversight and Investigations Testimony, 6/16/04).

2005
April: Treasury Secretary John Snow repeats his call for GSE reform, saying “Events that have transpired since I testified before this Committee in 2003 reinforce concerns over the systemic risks posed by the GSEs and further highlight the need for real GSE reform to ensure that our housing finance system remains a strong and vibrant source of funding for expanding homeownership opportunities in America… Half-measures will only exacerbate the risks to our financial system.” (Secretary John W. Snow, “Testimony Before The U.S. House Financial Services Committee,” 4/13/05).

2007
July: Two Bear Stearns hedge funds invested in mortgage securities collapse.

August: President Bush emphatically calls on Congress to pass a reform package for Fannie Mae and Freddie Mac, saying “first things first when it comes to those two institutions. Congress needs to get them reformed, get them streamlined, get them focused, and then I will consider other options.” (President George W. Bush, Press Conference, The White House, 8/9/07).

September: RealtyTrac announces foreclosure filings up 243,000 in August – up 115 percent from the year before.

September: Single-family existing home sales decreases 7.5 percent from the previous month – the lowest level in nine years. Median sale price of existing homes fell six percent from the year before.

December: President Bush again warns Congress of the need to pass legislation reforming GSEs, saying “These institutions provide liquidity in the mortgage market that benefits millions of homeowners, and it is vital they operate safely and operate soundly. So I’ve called on Congress to pass legislation that strengthens independent regulation of the GSEs – and ensures they focus on their important housing mission. The GSE reform bill passed by the House earlier this year is a good start. But the Senate has not acted. And the United States Senate needs to pass this legislation soon.” (President George W. Bush, Discusses Housing, The White House, 12/6/07).

2008
January: Bank of America announces it will buy Countrywide.

January: Citigroup announces mortgage portfolio lost $18.1 billion in value.

February: Assistant Secretary David Nason reiterates the urgency of reforms, says “A new regulatory structure for the housing GSEs is essential if these entities are to continue to perform their public mission successfully.” (David Nason, Testimony On Reforming GSE Regulation, Senate Committee On Banking, Housing And Urban Affairs, 2/7/08).

March: Bear Stearns announces it will sell itself to JPMorgan Chase.

March: President Bush calls on Congress to take action and “move forward with reforms on Fannie Mae and Freddie Mac. They need to continue to modernize the FHA, as well as allow State housing agencies to issue tax-free bonds to homeowners to refinance their mortgages.” (President George W. Bush, Remarks To The Economic Club Of New York, New York, NY, 3/14/08).

April: President Bush urges Congress to pass the much needed legislation and “modernize Fannie Mae and Freddie Mac. [There are] constructive things Congress can do that will encourage the housing market to correct quickly by … helping people stay in their homes.” (President George W. Bush, Meeting With Cabinet, the White House, 4/14/08).

May: President Bush issues several pleas to Congress to pass legislation reforming Fannie Mae and Freddie Mac before the situation deteriorates further.

· “Americans are concerned about making their mortgage payments and keeping their homes. Yet Congress has failed to pass legislation I have repeatedly requested to modernize the Federal Housing Administration that will help more families stay in their homes, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance sub-prime loans.” (President George W. Bush, Radio Address, 5/3/08).

· “[T]he government ought to be helping creditworthy people stay in their homes. And one way we can do that – and Congress is making progress on this – is the reform of Fannie Mae and Freddie Mac. That reform will come with a strong, independent regulator.” (President George W. Bush, Meeting With The Secretary Of The Treasury, the White House, 5/19/08).

· “Congress needs to pass legislation to modernize the Federal Housing Administration, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance subprime loans.” (President George W. Bush, Radio Address, 5/31/08).

June: As foreclosure rates continued to rise in the first quarter, the President once again asks Congress to take the necessary measures to address this challenge, saying “we need to pass legislation to reform Fannie Mae and Freddie Mac.” (President George W. Bush, Remarks At Swearing In Ceremony For Secretary Of Housing And Urban Development, Washington, D.C., 6/6/08).

July: Congress heeds the President’s call for action and passes reform of Fannie Mae and Freddie Mac as it becomes clear that the institutions are failing.

Just the Facts: The Administration’s Unheeded Warnings About the Systemic Risk Posed by the GSEs

 

[Markle]

Sorry about that.

Wages for the top 1% skyrocketed 160% since 1979 while the share of wages for the bottom 90% shrunk: Time to remake wage pattern with economic policies that generate robust wage-growth for vast majority

Newly available wage data tell a familiar story: In every period since 1979, wages for the bottom 90% were continuously redistributed upward to the top 10% and frequently to the very highest 1.0% and 0.1%. This unceasing growth of wage inequality that undercuts wage growth for the bottom 90%...

www.epi.org

Thanks to President Clinton for the skyrocketing of the top 1%.

 

[Harpy Eagle]

Thanks to President Clinton for the skyrocketing of the top 1%.

it is so damn cute how you make everything about partisan politics

 

[Markle]

So 2.2 Trillion. Thats it? you can think of no apropriation bill Trump signed? Nothing?

Strange considering everything you listed for Biden.

Then, please show us the list for President Trump, which includes things other than regular appropriation bills.

 

[Markle]

it is so damn cute how you make everything about partisan politics

Do you believe that I am wrong?

 

[Andylusion]

GSEs are highly leveraged by their very nature. Half of all outstanding real estate debt was held by GSE securities, given that volume of course there would be correspondingly large loss.

Can you actually show that their loss rates were worse then the rest of securitized mortgage market?

So the GSEs avoided all the risk sub-prime stuff, but it's entirely natural they had the largest loss.... on assets that had no loss.... but did, even though they avoided the risky assets.
Flip flopping around. They both were not risky yet had the biggest loss from the non-risky assets. Makes perfect logical sense.

Can you actually show that their loss rates were worse then the rest of securitized mortgage market?

Yes. Before 1997, there were ZERO sub-prime mortgage backed securities. ZERO.
Default rate was 2%.
That was before Freddie Mac and Fannie Mae intervened.

After they got involved, and made sub-prime loans acceptable to the market, the default rate went up.

This was true of everyone that engaged in sub-prime mortgage backed securities. The GSEs own data shows this.

https://files.stlouisfed.org/files/htdocs/publications/review/10/01/Sengupta.pdf

So if you look at Alt-A loans provided by Fannie and Freddie, the loans actually got WORSE over time. The number of low-doc, no-doc loans to people with lower than 680 credit ratings, actually INCREASED.

Whereas, the number of low-doc no-doc with less than 620 score SUB PRIME loans, decreased. Fewer were made.

And lastly you can see that the default rates for Alt-A loans provided by the GSE, were dramatically higher than the over all market of secure mortgage backed securities.
Again, the normal default rate is about 2%.
Alt-A loans on their absolute best year, had a default rate of 7%, up to almost 40% default rate.
Dramatically higher than prime rate mortgage backed securities.
Not just a tad.... dramatically higher.

 

[Harpy Eagle]

Do you believe that I am wrong?

Yes, I do.

I think it is the very nature of our system that both parties embrace and push when they are in power.

Did this gap get smaller once GW was in office?

 

[Markle]

Yes, I do.

I think it is the very nature of our system that both parties embrace and push when they are in power.

Did this gap get smaller once GW was in office?

President Clinton had opened the door. It is hard to stuff toothpaste back into the tube.

From Bloomberg Business week

How Bill Clinton Helped Boost CEO Pay
Posted on November 26, 2006

Bill Clinton had what he thought was a great idea to curb the soaring paychecks of the nation's executives. It was 1991, shortly after the launch of his Presidential campaign, and he had just read a best seller on corporate greed by compensation guru Graef Crystal.

Clinton's brainstorm: Use the tax code to curb excessive pay.

Companies at the time were allowed to deduct all compensation to top executives. Clinton wanted to permit companies to write off amounts over $1 million only if executives hit specified performance goals. He called Crystal for his thoughts. "Utterly stupid," the consultant says he told the future President. THE SHAME GAME

Now, 13 years after Clinton's plan became law, the results are clear: It didn't work. Over the law's first decade, average compensation for chief executives at companies in Standard & Poor's 500-stock index soared from $3.7 million to $9.1 million, according to a 2005 Harvard Law School study. The law contains so many obvious loopholes, says Crystal, that "in 10 minutes even Forrest Gump could think up five ways around it."

My emphasis

Read more: Businessweek - Bloomberg

###

Economic Policy

Bill Clinton tried to limit executive pay. Here’s why it didn’t work.
By Dylan Matthews
August 16, 2012

You probably know that executive compensation has skyrocketed over the past 20 years. In 1991, the average CEO took in $2.6 million in total compensation. By 2011, that number had risen to $9 million. What you probably don't know is that this rise occurred in spite of changes in the tax code meant to stop it.

In 1993, Bill Clinton signed into law his first budget, which created section 162(m) of the Internal Revenue Code. The provision stated that companies could only deduct the first $1 million of compensation for their top five (later top four after changes by Bush's SEC) executives from their corporate taxes. The idea was to discourage companies from paying in excess of $1 million, as any additional compensation would be taxed. So why didn't it work?

https://www.washingtonpost.com/news/wonk/wp/2012/08/16/bill-clinton-tried-to-limit-executive-pay-heres-why-it-didnt-work/