JonKoch
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Wow our Congress is strong to mandate CRA and lower lending standards to China, Russia, Ireland, Spain, etc. LMAOROG. Gawd you are funny.
O....M....G....DJIA Hits 50,000 Another huge win for Trump
- Thread starter Mashmont
- Start date
You don't like me posting facts? I do not happen to like unsupported narratives.STOP THE GAWDAMN COPYING AND PASTING CRAP YOU JUST DON'T EVEN UNDERSTAND!
One president controlled the regulators that not only let banks stop checking income but cheered them on. And as president Bush could enact the very policies that caused the Bush Mortgage Bubble and he did. And his party controlled Congress.
No, the GSEs Did Not Cause the Financial Meltdown (but thats just according to the data)
1. Private markets caused the shady mortgage boom: The first thing to point out is that the both the subprime mortgage boom and the subsequent crash are very much concentrated in the private market, especially the private label securitization channel (PLS) market. The Government-Sponsored Entities (GSEs, or Fannie and Freddie) were not behind them. The fly-by-night lending boom, slicing and dicing mortgage bonds, derivatives and CDOs, and all the other shadiness of the mortgage market in the 2000s were Wall Street creations, and they drove all those risky mortgages.
Here’s some data to back that up: “More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions… Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year.”
2. The government’s affordability mission didn’t cause the crisis
3. There is a lot of research to back this up and little against it
4. Conservatives sang a different tune before the crash: Conservative think tanks spent the 2000s saying the exact opposite of what they are saying now and the opposite of what Bloomberg said above. They argued that the CRA and the GSEs were getting in the way of getting risky subprime mortgages to risky subprime borrowers.
Hey Mayor Bloomberg! No, the GSEs Did Not Cause the Financial Meltdown (but thats just according to the data) - The Big Picture
Mike Konczal is a fellow with the Roosevelt Institute, and is a blogger at the Rortybomb Blog and New Deal 2.0. ~~~ Sigh. Mayor Bloomberg: “It was not the banks that created the mortgage crisis. It was, plain and simple, Congress, who forced everybody to go and give mortgages to people who were...ritholtz.com
Bush did not support business as usual in Fannie and Freddie, but Congress failed to pass the reforms he requested.
JonKoch
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Letter: The housing bubble was mandated by the government, Barney Frank
In response to the letter by Joanne DelSolar: I just wanted to comment about her insinuation that this economic disaster was Presidents Bush’s fault. Because President Bush was the sittingwww.lodinews.com
Letter: The housing bubble was mandated by the government, Barney Frank
- Sep 8, 2015
In response to the letter by Joanne DelSolar: I just wanted to comment about her insinuation that this economic disaster was Presidents Bush’s fault. Because President Bush was the sitting president at that time doesn’t mean his policies caused the economic disaster that we are still in.
In 1992 the Democratic Congress approved the Affordable Housing Act. This act eventually led to a lot of bad loans to people that should have never been able to enter the housing market. Government-sponsored enterprises Fannie Mae and Freddie Mac were to become deeply involved in this, the Affordable Housing Act, and were pushing bad loans to comply with the government mandate. Democrats Rep. Barney Frank and Sen. Chris Dodd were the leaders for this mandate.
Barney Frank, a Democrat, was chairman of the House Financial Services Committee and a longtime supporter of Fannie Mae and Freddie Mac. Because of the housing crisis, Barney Frank later admitted it was a mistake to force home ownership on people that couldn’t afford it. Renting would have been preferable. Now he tells us.
President Bush in 2003 proposed a bill to strengthen Freddie Mac and Fannie Mae regulation. But Rep. Barney Frank and Sen. Chris Dodd both stated Fannie and Freddie were not facing any financial crisis.
In 2005, the Bush administration made another attempt to downsize Freddie Mac and Fannie Mae, the bill got through the House committee, despite unanimous Democratic opposition. A vote was blocked by Democrats on the floor of the Senate.
By 2008 President Bush called for Freddie Mac and Fannie Mae reform, 17 times, the 18th time was the charm. In July (too late) Congress passed a reform bill that contained key elements of what the Bush administration had proposed five years earlier. The Democrats just kept denying there was a housing bubble that was about to burst. If the Democrats would have taken President Bush’s advice five years before, they may have prevented the housing crisis, or certainly would have lessened the financial impact on our nation.
I just wanted to inform the public of the real sequence of events that caused the housing bubble to burst. And it was a democratic problem, just ask Barney Frank.
WEIRD, BARNEY WAS THE MAJORITY IN THE HOUSE 2001-JAN 2007 AS THE HOUSING BUBBLE EXPLODED? Oh right, NO he was in the minority, NOT THE CHAIRMAN AS STATED IN YOUR BS RESPONSE
JonKoch
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Yeah, I heard he was weak, couldn't get tax cuts, wars, Medicare expansion, etc through his GOP controlled House where Barney was serving. Damn Barney
You know who was regulator of Fannie and Freddie during Dubya's term? Hint his dad was a previous Prez
You are correct. deregulation of banks under Bill Clinton freed banks to underwrite their own mortgage securities and MSBs (mortgage backed securites) were the number one villain in the 2008 financial collapse.
The Financial Services Modernization Act of 1999
predatorylending.duke.edu
The Financial Services Modernization Act of 1999
- IN THIS SECTION
- A Primer on the 1994 Home Ownership and Equity Protection Act
- The Financial Services Modernization Act of 1999
Published: April 25th, 2020
Click here to return to the memos page, or here for the main legislation page.
Executive Summary
The Financial Services Modernization Act of 1999, otherwise known as the Gramm-Leach-Bliley Act (“GLBA”), repealed banking regulations from the 1930s – the Glass-Steagall (1933) and the Bank Holding Company Act (1956). Those laws prevented the merger of commercial banks, stock brokerage companies, and insurance companies. GLBA also introduced the Financial Privacy Rule and the Safeguards Rule, which required financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data, respectively. In enacting GLBA, Congress aimed to “modernize” the financial services industry. By annulling Glass-Steagall and Bank Holding Company Act protections, GLBA encouraged consolidation in the financial services industry. Financial services companies created financial holding companies, which were now overseen by the Federal Reserve.[1] Experts continue to debate the lasting effects of this act. Critics often argue that GLBA contributed to the financial crisis of 2008 by deregulating the banking sector and removing restrictions on commercial bank securities activities. GLBA supporters contend that not passing GLBA, or later repealing it, would not have prevented the financial crisis, which resulted from bad investments by large, poorly capitalized financial institutions.[2]
Introduction
President Bill Clinton signed the Financial Services Modernization Act into law on November 12, 1999. Sen. Phil Gramm, Rep. Jim Leach and Rep. Thomas Bliley sponsored the bill, and together, became its namesake. Known as the Gramm-Leach-Bliley Act (“GLBA”), GLBA repealed aspects of the Glass-Steagall Act (1933) and the Bank Holding Company Act (1956), removing barriers that previously separated banking companies, securities companies and insurance companies, and that prohibited commercial banks from underwriting most bonds, equities, and insurance policies. [3] After passage of GLBA, financial holding companies (FHCs) were allowed to conduct these activities.
JonKoch
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True, Dubya decided to go much further with Fannie/Freddie Cupcake
Bush Mortgage Bubble include (but not limited to)
Wanting 5.5 million more minority homeowners
Tells congress there is nothing wrong with GSEs
Pledging to use federal policy to increase home ownership
Routinely taking credit for the housing market
Forcing GSEs to buy more low income home loans by raising their Housing Goals
Lowering Investment banks capital requirements, Net Capital rule
Reversing the Clinton rule that restricted GSEs purchases of subprime loans
Lowering down payment requirements to 0%
Forcing GSEs (THAT'S FANNIE AND FREDDIE) to spend an additional $440 billion in the secondary markets
Giving away 40,000 free down payments
PREEMPTING ALL STATE LAWS AGAINST PREDATORY LENDING
But the biggest policy was regulators not enforcing lending standards.
Do you think Congress cannot control what legislation gets passed and what legislation gets blocked?
Barney Frank later apologized for his misstatements about Fannie Mae, where his live-in lover was employed as an executive.
JonKoch
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You are correct. deregulation of banks under Bill Clinton freed banks to underwrite their own mortgage securities and MSBs (mortgage backed securites) were the number one villain in the 2008 financial collapse.
The Financial Services Modernization Act of 1999
The Financial Services Modernization Act of 1999
Author: Despina Chouliara
- IN THIS SECTION
- A Primer on the 1994 Home Ownership and Equity Protection Act
- The Financial Services Modernization Act of 1999
Published: April 25th, 2020
Click here to return to the memos page, or here for the main legislation page.
Executive Summary
The Financial Services Modernization Act of 1999, otherwise known as the Gramm-Leach-Bliley Act (“GLBA”), repealed banking regulations from the 1930s – the Glass-Steagall (1933) and the Bank Holding Company Act (1956). Those laws prevented the merger of commercial banks, stock brokerage companies, and insurance companies. GLBA also introduced the Financial Privacy Rule and the Safeguards Rule, which required financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data, respectively. In enacting GLBA, Congress aimed to “modernize” the financial services industry. By annulling Glass-Steagall and Bank Holding Company Act protections, GLBA encouraged consolidation in the financial services industry. Financial services companies created financial holding companies, which were now overseen by the Federal Reserve.[1] Experts continue to debate the lasting effects of this act. Critics often argue that GLBA contributed to the financial crisis of 2008 by deregulating the banking sector and removing restrictions on commercial bank securities activities. GLBA supporters contend that not passing GLBA, or later repealing it, would not have prevented the financial crisis, which resulted from bad investments by large, poorly capitalized financial institutions.[2]
Introduction
President Bill Clinton signed the Financial Services Modernization Act into law on November 12, 1999. Sen. Phil Gramm, Rep. Jim Leach and Rep. Thomas Bliley sponsored the bill, and together, became its namesake. Known as the Gramm-Leach-Bliley Act (“GLBA”), GLBA repealed aspects of the Glass-Steagall Act (1933) and the Bank Holding Company Act (1956), removing barriers that previously separated banking companies, securities companies and insurance companies, and that prohibited commercial banks from underwriting most bonds, equities, and insurance policies. [3] After passage of GLBA, financial holding companies (FHCs) were allowed to conduct these activities.
Cool, DIDN'T APPLY TO THE 5 INVESTMENT BANKS, WALL STREET WHO FUNDED 24 OF THE 25 BIGGEST MORTGAGE LENDERS IN 2006
The Rise of Nonbank Mortgage Lending
Nonbank mortgage lenders have revolutionized the U.S. housing finance market, growing from a 20% market share in 1990 to over 65% by 2020 and dominating current originations.
JonKoch
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I get it, the gay guy was guilty. Although he NEVER apologized and you are full of it. He explained how Dubya fueled the subprime crisis AND took down the US economy
JonKoch
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In the rest of the world? TRY TO THINK. I've posted several times WORLD WIDE CREDIT BUBBLE AND BUST. Housing prices in Spain, Germany, Russia, China, etc EXPLODED because of this new thing called CDO'S AND MBS (not so new) they bundled and sold as AAA rated. Housing prices doubled in the world in 7 years. CONGRESS? LOL
I do know that dozens of executives of large corporations had to repay their bonuses after the 2008 collapse but Franklin Raines, the black CEO of Fannie Mae, was allowed by the Obama administration to keep more than $100 million of ill-gotten gains while cooking the books at Fannie Mae, and the Obama administration defended Raines in court at government expense.
Bush did that, or Bush wanted this, or Bush tried to get that, or Bush yada yada yada. Congress created the broken mortgage lending systems and democrats blamed Bush and everyone else but themselves for the disaster that good financial experts warned them about from the beginning.True, Dubya decided to go much further with Fannie/Freddie Cupcake
Bush Mortgage Bubble include (but not limited to)
Wanting 5.5 million more minority homeowners
Tells congress there is nothing wrong with GSEs
Pledging to use federal policy to increase home ownership
Routinely taking credit for the housing market
Forcing GSEs to buy more low income home loans by raising their Housing Goals
Lowering Investment banks capital requirements, Net Capital rule
Reversing the Clinton rule that restricted GSEs purchases of subprime loans
Lowering down payment requirements to 0%
Forcing GSEs (THAT'S FANNIE AND FREDDIE) to spend an additional $440 billion in the secondary markets
Giving away 40,000 free down payments
PREEMPTING ALL STATE LAWS AGAINST PREDATORY LENDING
But the biggest policy was regulators not enforcing lending standards.
what
Barney Frank's apology for statements made that hid problems with Fannie Mae was part of a broader discussion on the role of government-sponsored enterprises in the housing market. Frank's statements and actions were part of a larger debate on the regulation and oversight of financial institutions, particularly during the housing crisis. His comments were made in the context of the need for better regulation and oversight to prevent future financial crises.manhattan.institute
The collapse of Bear Stearns in March 2008 was primarily responsible for the financial crisis that brought down Wall Street in 2008. This crisis was triggered by the collapse of mortgage-backed securities (MBS), which were heavily involved in Bear Stearns' operations. The MBS market was fueled by risky lending practices and excessive leverage, leading to a significant decline in their value. The failure of Bear Stearns, along with the subsequent collapse of Lehman Brothers and other major financial institutions, marked the beginning of the global financial crisis that affected the entire financial system.
Wikipedia+2
JonKoch
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Can you explain why big banks paid over $100+ BILLION in fines for what they did in the subprime bubble? Wouldn't they have fought in court IF they were forced to loan money to minorities?
The Republican-led Congress didn't pass a single bill with oversight of the GSE's between 2003 and 2006?
"(In 2000, CLINTON ) HUD restricted Freddie and Fannie, saying it would not credit them for loans they purchased that had abusively high costs or that were granted without regard to the borrower's ability to repay."
How HUD Mortgage Policy Fed The Crisis
"In 2004 (BUSH), the 2000 rules were dropped and high risk loans were again counted toward affordable housing goal
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.
No paywall from Bloomberg above
Fannie Mae and Freddie Mac were victims, not culprits
The Myth of Fannie Mae, Freddie Mac, Barney Frank, the Housing Bubble and the Recession
The Myth of Fannie Mae, Freddie Mac, Barney Frank, the Housing Bubble and the Recession
Jeff Dunetz at Big Government must have passed the right-wing media journalism test. He follows in the same hollowed ethical standards as Andrew Breitbart himself, James O’Keefe and Kevin Pez…
thelonggoodbye.wordpress.com
The idea that they were leading this charge is just absurd said Guy Cecala, publisher of Inside Mortgage Finance, an authoritative trade publication. Fannie and Freddie have always had the tightest underwriting on earth They were opposite of subprime.
FactWatch: Fannie and Freddie were followers, not leaders, in mortgage frenzy – Center for Public Integrity
Ask many Americans who’s to blame for the nation’s economic mess, and two names come to mind: Fannie and Freddie. They see Fannie Mae and Freddie Mac as the villains of the financial crisis. GOP.gov, the official website for Republicans in the House of Representatives, says flatly: “Fannie Mae...
publicintegrity.org
In an op-ed piece in the Wall Street Journal, Lawrence B. Lindsey, a former economic adviser to President George W. Bush, wrote that Frank "is the only politician I know who has argued that we needed tighter rules that intentionally produce fewer homeowners and more renters."
SO IT TOOK 70 YEARS FOR 'LIB' INTERFERENCE TO CRASH THE GSE';s huh? lol
Private lenders not subject to congressional regulations collapsed lending standards.
....A 2008 analysis found that the nonbank underwriters made more than 12 million subprime mortgages with a value of nearly $2 trillion. The lenders who made these were exempt from federal regulations
JonKoch
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READ YOUR DAMN LINKS, HE DOESN'T APOLOGIZE, YOUR LINK
"Frank says such people are the victims, not the cause."
JonKoch
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The collapse of Bear Stearns in March 2008 was primarily responsible for the financial crisis that brought down Wall Street in 2008. This crisis was triggered by the collapse of mortgage-backed securities (MBS), which were heavily involved in Bear Stearns' operations. The MBS market was fueled by risky lending practices and excessive leverage, leading to a significant decline in their value. The failure of Bear Stearns, along with the subsequent collapse of Lehman Brothers and other major financial institutions, marked the beginning of the global financial crisis that affected the entire financial system.
Wikipedia+2
So no you can't read OR critically think? Hint
ONE MORE TIME
In the rest of the world? TRY TO THINK. I've posted several times
WORLD WIDE CREDIT BUBBLE AND BUST. Housing prices in Spain, Germany, Russia, China, etc EXPLODED because of this new thing called CDO'S AND MBS (not so new) they bundled and sold as AAA rated. Housing prices doubled in the world in 7 years. CONGRESS? LOL
CONGRESS MANDATED HOUSING PRICES DOUBLING IN 7 YEARS IN CHINA, RUSSIA, IRELAND, SPAIN, ETC? lol
JonKoch
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So the $100 BILLION banks paid in fines? Nothing? They just step up and give Gov't money after Gov't FORCED them to loan to people without proof of income, no credit checks, no jobs, etc?
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