Krugman rips von Mises up one side & down the other

[Bfgrn]

. All you have to do is explain how selling homes to low-income people and minorities were the sole cause of a worldwide financial meltdown

literally speaking it was not the sole cause, it was the primary cause which is what Sowell said!

It wasn't the primary cause. As a matter of FACT, it was a NON factor.

Wrong asshole. virtually everyone acknowledges that sub-prime mortgages were the cause of the problem.

WRONG. The housing crisis was not the fault of poor people. It was not the fault of government. It was the fault of the PRIVATE sector and speculators.

“Flip This House”: Investor Speculation and the Housing Bubble

At the peak of the boom in 2006, over a third of all U.S. home purchase lending was made to people who already owned at least one house. In the four states with the most pronounced housing cycles, the investor share was nearly half—45 percent. Investor shares roughly doubled between 2000 and 2006. While some of these loans went to borrowers with “just” two homes, the increase in percentage terms is largest among those owning three or more properties. In 2006, Arizona, California, Florida, and Nevada investors owning three or more properties were responsible for nearly 20 percent of originations, almost triple their share in 2000.

Because investors don’t plan to own properties for long, they care much more about reducing their down-payments than reducing their interest rates. The expansion of the nonprime mortgage market during the 2000s provided the perfect opportunity for optimistic investors to get low-down-payment credit, albeit at high interest rates..., investors were far more likely than owner-occupants to use nonprime credit to make their purchases, especially at the peak. ...

link

 

[bripat9643]

. All you have to do is explain how selling homes to low-income people and minorities were the sole cause of a worldwide financial meltdown

literally speaking it was not the sole cause, it was the primary cause which is what Sowell said!

It wasn't the primary cause. As a matter of FACT, it was a NON factor.

Wrong asshole. virtually everyone acknowledges that sub-prime mortgages were the cause of the problem.

WRONG. The housing crisis was not the fault of poor people. It was not the fault of government. It was the fault of the PRIVATE sector and speculators.

“Flip This House”: Investor Speculation and the Housing Bubble

At the peak of the boom in 2006, over a third of all U.S. home purchase lending was made to people who already owned at least one house. In the four states with the most pronounced housing cycles, the investor share was nearly half—45 percent. Investor shares roughly doubled between 2000 and 2006. While some of these loans went to borrowers with “just” two homes, the increase in percentage terms is largest among those owning three or more properties. In 2006, Arizona, California, Florida, and Nevada investors owning three or more properties were responsible for nearly 20 percent of originations, almost triple their share in 2000.

Because investors don’t plan to own properties for long, they care much more about reducing their down-payments than reducing their interest rates. The expansion of the nonprime mortgage market during the 2000s provided the perfect opportunity for optimistic investors to get low-down-payment credit, albeit at high interest rates..., investors were far more likely than owner-occupants to use nonprime credit to make their purchases, especially at the peak. ...

link

When the regulators forced banks to lower the standards so people with bad credit could get mortgages, they lowered the standards for everyone. Since Fannie and Freddie bellied up to the bar and purchased these mortgages, the bankers had nothing to lose. The bottom line is that government regulators caused the problem. It wasn't banker "greed."

 

[bendog]

poor people brought Lehman Bros to their knees.

 

[EdwardBaiamonte]

. It was the fault of the PRIVATE sector and speculators.

dear, Fed Fanny Freddie created money as a matter of policy to stimulate economy and help poor so millions could buy and bid up prices of houses. ThE bubble was 100% impossible without them.

See why we say liberalism is based in pure ignorance? Is another conclusion possible?

 

[EdwardBaiamonte]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

 

[Bfgrn]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

 

[bripat9643]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

 

[Bfgrn]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

 

[bripat9643]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

Your source is ThinkProgress.

Enough said.

 

[Bfgrn]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

Your source is ThinkProgress.

Enough said.

BULLSHIT. You right wing SCUM will never accept ANY criticism of your beloved Wall Street banksters.

Andrew Sullivan does not work for ThinkProgress

Andrew Michael Sullivan (born 10 August 1963) is a British author, editor and blogger, resident in the United States. A former editor of The New Republic and the author or editor of six books, Sullivan is an influential blogger and commentator. He was a pioneer of the political blog, starting his in 2000. He eventually moved the blog to various publishing platforms, including Time Magazine, The Atlantic, and The Daily Beast. In 2013, he switched to an independent, subscription-based format.

Sullivan's Burkean conservativism is rooted in his British Catholic background and in the political philosophy of his mentor, Michael Oakeshott.

Sullivan compiled information from:
Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

 

[bripat9643]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

Your source is ThinkProgress.

Enough said.

BULLSHIT. You right wing SCUM will never accept ANY criticism of your beloved Wall Street banksters.

Andrew Sullivan does not work for ThinkProgress

Andrew Michael Sullivan (born 10 August 1963) is a British author, editor and blogger, resident in the United States. A former editor of The New Republic and the author or editor of six books, Sullivan is an influential blogger and commentator. He was a pioneer of the political blog, starting his in 2000. He eventually moved the blog to various publishing platforms, including Time Magazine, The Atlantic, and The Daily Beast. In 2013, he switched to an independent, subscription-based format.

Sullivan's Burkean conservativism is rooted in his British Catholic background and in the political philosophy of his mentor, Michael Oakeshott.

Sullivan compiled information from:
Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Andrew Sullivan - Wikipedia the free encyclopedia

During the 2012 election campaign he wrote, "Against a radical right, reckless, populist insurgency, Obama is the conservative option, dealing with emergent problems with pragmatic calm and modest innovation. He seeks as a good Oakeshottian would to reform the country's policies in order to regain the country's past virtues. What could possibly be more conservative than that?"

Apparently the term "Burkean conservative" is a euphemism meaning "liberal."

Anyone can dig up quotes by leftwingers to support their leftwing theories. Sociology professors do it all the time.

 

[Bfgrn]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

Your source is ThinkProgress.

Enough said.

BULLSHIT. You right wing SCUM will never accept ANY criticism of your beloved Wall Street banksters.

Andrew Sullivan does not work for ThinkProgress

Andrew Michael Sullivan (born 10 August 1963) is a British author, editor and blogger, resident in the United States. A former editor of The New Republic and the author or editor of six books, Sullivan is an influential blogger and commentator. He was a pioneer of the political blog, starting his in 2000. He eventually moved the blog to various publishing platforms, including Time Magazine, The Atlantic, and The Daily Beast. In 2013, he switched to an independent, subscription-based format.

Sullivan's Burkean conservativism is rooted in his British Catholic background and in the political philosophy of his mentor, Michael Oakeshott.

Sullivan compiled information from:
Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Andrew Sullivan - Wikipedia the free encyclopedia

During the 2012 election campaign he wrote, "Against a radical right, reckless, populist insurgency, Obama is the conservative option, dealing with emergent problems with pragmatic calm and modest innovation. He seeks as a good Oakeshottian would to reform the country's policies in order to regain the country's past virtues. What could possibly be more conservative than that?"

Apparently the term "Burkean conservative" is a euphemism meaning "liberal."

Anyone can dig up quotes by leftwingers to support their leftwing theories. Sociology professors do it all the time.

Any human being with a brain could decipher that the foreclosure epicenters were NOT low income, government borrowers.

That precludes YOU...

 

[bripat9643]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

Your source is ThinkProgress.

Enough said.

BULLSHIT. You right wing SCUM will never accept ANY criticism of your beloved Wall Street banksters.

Andrew Sullivan does not work for ThinkProgress

Andrew Michael Sullivan (born 10 August 1963) is a British author, editor and blogger, resident in the United States. A former editor of The New Republic and the author or editor of six books, Sullivan is an influential blogger and commentator. He was a pioneer of the political blog, starting his in 2000. He eventually moved the blog to various publishing platforms, including Time Magazine, The Atlantic, and The Daily Beast. In 2013, he switched to an independent, subscription-based format.

Sullivan's Burkean conservativism is rooted in his British Catholic background and in the political philosophy of his mentor, Michael Oakeshott.

Sullivan compiled information from:
Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Andrew Sullivan - Wikipedia the free encyclopedia

During the 2012 election campaign he wrote, "Against a radical right, reckless, populist insurgency, Obama is the conservative option, dealing with emergent problems with pragmatic calm and modest innovation. He seeks as a good Oakeshottian would to reform the country's policies in order to regain the country's past virtues. What could possibly be more conservative than that?"

Apparently the term "Burkean conservative" is a euphemism meaning "liberal."

Anyone can dig up quotes by leftwingers to support their leftwing theories. Sociology professors do it all the time.

Any human being with a brain could decipher that the foreclosure epicenters were NOT low income, government borrowers.

That precludes YOU...

Your map doesn't prove a thing.

Any human being with a brain could decipher that forcing banks to grant mortgages to people with no credit and doing it by lowering their credit requirements for all borrowers would produce a banking catastrophe. Only morons would blame it on "greed" or "deregulation."

 

[Bfgrn]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

Fannie Freddie and the Subprime Mortgage Market Cato Institute

Changes in the mortgage market, resulting largely from misguided monetary policy, drove a frenzy of refinancing activity in 2003. When that origination boom died out, mortgage industry participants looked elsewhere for profits. Fannie and Freddie, among others, found those illusionary profits in lowering credit quality.

Foremost among the government-sponsored enterprises’ deleterious activities was their vast direct purchases of loans that can only be characterized as subprime. Under reasonable definitions of subprime, almost 30 percent of Fannie and Freddie direct purchases could be considered subprime.

The government-sponsored enterprises were also the largest single investor in subprime privatelabel mortgage-backed securities. During the height of the housing bubble, almost 40 percent of newly issued private-label subprime securities were purchased by Fannie Mae and Freddie Mac.

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

more

Your source is ThinkProgress.

Enough said.

BULLSHIT. You right wing SCUM will never accept ANY criticism of your beloved Wall Street banksters.

Andrew Sullivan does not work for ThinkProgress

Andrew Michael Sullivan (born 10 August 1963) is a British author, editor and blogger, resident in the United States. A former editor of The New Republic and the author or editor of six books, Sullivan is an influential blogger and commentator. He was a pioneer of the political blog, starting his in 2000. He eventually moved the blog to various publishing platforms, including Time Magazine, The Atlantic, and The Daily Beast. In 2013, he switched to an independent, subscription-based format.

Sullivan's Burkean conservativism is rooted in his British Catholic background and in the political philosophy of his mentor, Michael Oakeshott.

Sullivan compiled information from:
Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Andrew Sullivan - Wikipedia the free encyclopedia

During the 2012 election campaign he wrote, "Against a radical right, reckless, populist insurgency, Obama is the conservative option, dealing with emergent problems with pragmatic calm and modest innovation. He seeks as a good Oakeshottian would to reform the country's policies in order to regain the country's past virtues. What could possibly be more conservative than that?"

Apparently the term "Burkean conservative" is a euphemism meaning "liberal."

Anyone can dig up quotes by leftwingers to support their leftwing theories. Sociology professors do it all the time.

Any human being with a brain could decipher that the foreclosure epicenters were NOT low income, government borrowers.

That precludes YOU...

Your map doesn't prove a thing.

Any human being with a brain could decipher that forcing banks to grant mortgages to people with no credit and doing it by lowering their credit requirements for all borrowers would produce a banking catastrophe. Only morons would blame it on "greed" or "deregulation."

NO BANKS or lenders were EVER 'forced' to grant mortgages to ANYONE. And NO BANKS or lenders were EVER 'forced' to make loans that were not sound financially. The private lenders who catered to speculators raced to provide any and all 'gimmick' loans.

Sections 802(b) and 804(1) of the Community Reinvestment Act states that any actions by the lending institutions to achieve compliance with the act should be “consistent with the safe and sound operation of such institution.” The law emphasizes that an institution’s CRA activities should be undertaken in a safe and sound manner, and does not require institutions to make high-risk loans that may bring losses to the institution.

IF you had a brain, you would understand the motivation of speculators and the dynamics of the loans they sought.

LISTEN UP...these speculators WERE NEVER, EVER going to live in the houses they were buying. They were not buying a homestead. They were making a short term investment to make fast money. They CRAVED gimmick loans that had the LEAST initial commitment. Mortgage means a death agreement. They were not signing their lives away. And when those INVESTMENTS went south, they DUMPED them. That is why there was a rupture of the housing market, instead of a slow leak.

 

[dblack]

NO BANKS or lenders were EVER 'forced' to grant mortgages to ANYONE. And NO BANKS or lenders were EVER 'forced' to make loans that were not sound financially. The private lenders who catered to speculators raced to provide any and all 'gimmick' loans.

Sections 802(b) and 804(1) of the Community Reinvestment Act states that any actions by the lending institutions to achieve compliance with the act should be “consistent with the safe and sound operation of such institution.” The law emphasizes that an institution’s CRA activities should be undertaken in a safe and sound manner, and does not require institutions to make high-risk loans that may bring losses to the institution.

IF you had a brain, you would understand the motivation of speculators and the dynamics of the loans they sought.

LISTEN UP...these speculators WERE NEVER, EVER going to live in the houses they were buying. They were not buying a homestead. They were making a short term investment to make fast money. They CRAVED gimmick loans that had the LEAST initial commitment. Mortgage means a death agreement. They were not signing their lives away. And when those INVESTMENTS went south, they DUMPED them. That is why there was a rupture of the housing market, instead of a slow leak.

I don't think what you're saying here can be ignored. In an economic environment where consumers (and investors) assume that regulations are protecting them, piecemeal deregulation is very dangerous. Parties on both sides of economic transactions fall into the habit of doing what is "legal" (and offers the most enticing rewards) rather than carefully considering what is prudent. This is the moral hazard of the regulatory regime.

 

[CrusaderFrank]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

WRONG!!!

As wrong as Krugman

F/F took No Income No Asset loans as AAA rated paper!

That's subprime

 

[Bfgrn]

NO BANKS or lenders were EVER 'forced' to grant mortgages to ANYONE. And NO BANKS or lenders were EVER 'forced' to make loans that were not sound financially. The private lenders who catered to speculators raced to provide any and all 'gimmick' loans.

Sections 802(b) and 804(1) of the Community Reinvestment Act states that any actions by the lending institutions to achieve compliance with the act should be “consistent with the safe and sound operation of such institution.” The law emphasizes that an institution’s CRA activities should be undertaken in a safe and sound manner, and does not require institutions to make high-risk loans that may bring losses to the institution.

IF you had a brain, you would understand the motivation of speculators and the dynamics of the loans they sought.

LISTEN UP...these speculators WERE NEVER, EVER going to live in the houses they were buying. They were not buying a homestead. They were making a short term investment to make fast money. They CRAVED gimmick loans that had the LEAST initial commitment. Mortgage means a death agreement. They were not signing their lives away. And when those INVESTMENTS went south, they DUMPED them. That is why there was a rupture of the housing market, instead of a slow leak.

I don't think what you're saying here can be ignored. In an economic environment where consumers (and investors) assume that regulations are protecting them, piecemeal deregulation is very dangerous. Parties on both sides off economic transactions fall into the habit of doing what is "legal" (and offers the most enticing rewards) rather than carefully considering what is prudent. This is the moral hazard of the regulatory regime.

Speculators didn't buy multiple dwellings with any assumptions they were 'protected' by government. This was clearly a LACK of regulations and oversight by government.

The elephants in bripat's room are:

1) He needs to explain if selling homes to poor Americans created the housing bubble, WHY the biggest foreclosure areas aren’t Harlem or Chicago’s South side or DC slums or inner city Philly; Rather, it has been non-CRA regions — the Sand States — such as southern California, Las Vegas, Arizona, and South Florida.

2) He needs to explain if selling homes to poor Americans created the housing bubble, HOW that caused a worldwide financial meltdown and how the CRA forced bankers to lend to deadbeats in Iceland, Ireland, Spain and Romania?

 

[Bfgrn]

The bottom line is that government regulators caused the problem. It wasn't banker "greed."

this is very true. Not only did the Fed create the mortgage money necessary to make the boom possible, but then Fan/Fred bought the mortgages from the banks so the banks would have more new mortgage money to inflate the bubble further. Plus, Fan Fred guarenteed the mortgages so bankers did not have to worry about the quality of mortgages. Plus, it was widely assumed that the Greenspan Put( more Fed money) would be utilized to save the mortgage industry with ever higher housing prices should there ever be a problem.

A free market is self-correcting, a liberal soviet,i.e., one featuring tons of liberal/soviet interference will result in a soviet standard of living for all.

You are talking our of your ass...

Start with the most basic fact of all: virtually none of the $1.5 trillion of cratering subprime mortgages were backed by Fannie or Freddie. That’s right — most subprime mortgages did not meet Fannie or Freddie’s strict lending standards. All those no money down, no interest for a year, low teaser rate loans? All the loans made without checking a borrower’s income or employment history? All made in the private sector, without any support from Fannie and Freddie.

Look at the numbers. While the credit bubble was peaking from 2003 to 2006, the amount of loans originated by Fannie and Freddie dropped from $2.7 trillion to $1 trillion. Meanwhile, in the private sector, the amount of subprime loans originated jumped to $600 billion from $335 billion and Alt-A loans hit $400 billion from $85 billion in 2003. Fannie and Freddie, which wouldn’t accept crazy floating rate loans, which required income verification and minimum down payments, were left out of the insanity.

more

WRONG!!!

As wrong as Krugman

F/F took No Income No Asset loans as AAA rated paper!

That's subprime

The overwhelming consensus from readers and the economic writers they cite is that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac did not solely cause the financial crisis.

For some data, start here: ”More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions [not GSEs]….Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year."

Did Fannie and Freddie buy high-risk mortgage-backed securities? Yes. But they did not buy enough of them to be blamed for the mortgage crisis. Highly respected analysts who have looked at these data in much greater detail than [American Enterprise Institute's Peter] Wallison, [AEI consultant Ed] Pinto, or myself, including the nonpartisan Government Accountability Office [pdf], the Harvard Joint Center for Housing Studies [pdf], the Financial Crisis Inquiry Commission majority [pdf], the Federal Housing Finance Agency [pdf], and virtually all academics, including the University of North Carolina [pdf], Glaeser et al at Harvard [pdf], and the St. Louis Federal Reserve [pdf], have all rejected the Wallison/Pinto argument that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages over the past decade.

Private label loans "have defaulted at over 6x the rate of GSE loans, as well as the fact that private label securitization is responsible for 42% of all delinquencies despite accounting for only 13% of all outstanding loans (as compared to the GSEs being responsible for 22% of all delinquencies despite accounting for 57% of all outstanding loans)."

Fannie and Freddie were participants but not instigators of the crisis

 

[dblack]

Speculators didn't buy multiple dwellings with any assumptions they were 'protected' by government. This was clearly a LACK of regulations and oversight by government.

Of course. And in a way I agree with you. The only way government intervention in our economic decisions really works is to go all the way, with a full blown state-run economy.

It's the vague middle ground that's killing us.

 

[bripat9643]

NO BANKS or lenders were EVER 'forced' to grant mortgages to ANYONE. And NO BANKS or lenders were EVER 'forced' to make loans that were not sound financially. The private lenders who catered to speculators raced to provide any and all 'gimmick' loans.

Sections 802(b) and 804(1) of the Community Reinvestment Act states that any actions by the lending institutions to achieve compliance with the act should be “consistent with the safe and sound operation of such institution.” The law emphasizes that an institution’s CRA activities should be undertaken in a safe and sound manner, and does not require institutions to make high-risk loans that may bring losses to the institution.

IF you had a brain, you would understand the motivation of speculators and the dynamics of the loans they sought.

LISTEN UP...these speculators WERE NEVER, EVER going to live in the houses they were buying. They were not buying a homestead. They were making a short term investment to make fast money. They CRAVED gimmick loans that had the LEAST initial commitment. Mortgage means a death agreement. They were not signing their lives away. And when those INVESTMENTS went south, they DUMPED them. That is why there was a rupture of the housing market, instead of a slow leak.

I don't think what you're saying here can be ignored. In an economic environment where consumers (and investors) assume that regulations are protecting them, piecemeal deregulation is very dangerous. Parties on both sides of economic transactions fall into the habit of doing what is "legal" (and offers the most enticing rewards) rather than carefully considering what is prudent. This is the moral hazard of the regulatory regime.

There was no "deregulation." That's a liberal myth.