Zone1 Tax the Rich! Make them Pay their Fair Share!

[JonKoch]

YET THEY WERE OVERTAKEN BY THE PLS DURING DUBYA'S SUBPRIME BUBBLE. Go figure

Fannie, Freddie and the commercial banks bought those as well.

LMAOROG. Ok you don't know what PLS means. Got it

 

[JonKoch]

View attachment 1243546

Let me guess, THAT'S supposed to be Dubya "warning" about the GSE's 17 times?


Bush talked about reform. He talked and he talked. And then he stopped reform. (read that as many times as necessary. Bush stopped reform). And then he stopped it again

 

[Robert W]

Wall Street firms, including Bear Stearns, Lehman Brothers, and Goldman Sachs, aggressively purchased, bundled, and sold subprime mortgages into securities (MBS/CDOs) to meet investor demand. When the housing bubble burst and defaults soared in 2007, the market collapsed, leaving banks holding billions in toxic debt, triggering the subprime mortgage crisis. "

Lehman Brothers owned a lot of loan firms. Who did you say sold the loans to Lehman? Did you say Fannie Mae who purchased loans from originators sold them to Lehman Brothers?

You are feeding your search engine biased information.

 

[JonKoch]

View attachment 1243546

June 17, 2004

(CNN/Money) - Home builders, realtors and others are preparing to fight a Bush administration plan that would require Fannie Mae and Freddie Mac to increase financing of homes for low-income people, a home builder group said Thursday.


Home builders fight Bush's low-income housing - Jun. 17, 2004


In 2004, a coalition including the National Association of Home Builders and National Association of Realtors lobbied against a Bush administration HUD proposal forcing Fannie Mae and Freddie Mac to increase financing for low-income housing. Critics argued the rules would create a "catch-22," restricting credit for middle-income homebuyers to meet the new mandates.
Key Aspects of the 2004 Conflict:

• Administration Goal: Unable to get regulatory legislation through Congress, the Bush administration used HUD to mandate that Fannie and Freddie, the government-sponsored enterprises (GSEs), purchase more loans for low-income, affordable housing.

• Industry Opposition: The National Association of Home Builders, Realtors, and Mortgage Bankers Association warned of "unintended consequences," arguing the focus on, at the time, risky low-income financing could hurt broader market stability and middle-income affordability.

• Impact on GSEs: Fannie and Freddie deemed the new, higher targets "unrealistic," arguing they forced a diversion of funds from middle-income financing to higher-risk, low-income segments.

• Wider Context: The debate centered on balancing affordable housing goals with the financial health of the GSEs, which at the time held or guaranteed over $5 trillion in mortgages, representing nearly half the U.S. housing market.

Obsessive Housing Disorder

Justin Sullivan/Getty ImagesLax lending standards encouraged by the government contributed to our current foreclosure crisis. In December, the New York Times published a 5,100-word article charging that the Bush administration’s housing policies had “stoked” the foreclosure crisis—and thus the...

www.city-journal.org

 

[JonKoch]

Lehman Brothers owned a lot of loan firms. Who did you say sold the loans to Lehman? Did you say Fannie Mae who purchased loans from originators sold them to Lehman Brothers?

You are feeding your search engine biased information.

Gawd you are dumb, TRY TO READ IT CUPCAKE



MY OLD FORUM FROM 2014 Cupcake, nothing new from me

Thread 'FACTS on Dubya's great recession'

Jul 2, 2014

Q When did the Bush Mortgage Bubble start?

A The general timeframe is it started late 2004.

From Bush’s President’s Working Group on Financial Markets October 2008

“The Presidents Working Group’s March policy statement acknowledged that turmoil in financial markets clearly was triggered by a dramatic weakening of underwriting standards for U.S. subprime mortgages, beginning in late 2004 and extending into 2007.”



Q Did the Community Reinvestment Act under Carter/Clinton caused it?


A "Since 1995 there has been essentially no change in the basic CRA rules or...

• Dad2three
• Replies: 481
• Forum: Economy

• 

 

[JonKoch]

Lehman Brothers owned a lot of loan firms. Who did you say sold the loans to Lehman? Did you say Fannie Mae who purchased loans from originators sold them to Lehman Brothers?

You are feeding your search engine biased information.

READ THE DAMN POSIT DUMMY

Wall Street firms, including Bear Stearns, Lehman Brothers, and Goldman Sachs, aggressively purchased, bundled, and sold subprime mortgages into securities (MBS/CDOs) to meet investor demand. When the housing bubble burst and defaults soared in 2007, the market collapsed, leaving banks holding billions in toxic debt, triggering the subprime mortgage crisis. "



You know TRANCHES

 

[Robert W]

Let me guess, THAT'S supposed to be Dubya "warning" about the GSE's 17 times?


Bush talked about reform. He talked and he talked. And then he stopped reform. (read that as many times as necessary. Bush stopped reform). And then he stopped it again

Bush to stop it had to veto changes. Democrats put the brakes on changes. Bush got nothing to agree to thanks to Democrats.

Don't Blame Bush for Subprime Mess | RealClearMarkets

Housing Crisis: A new report from the Associated Press claims that the mortgage meltdown is due largely to President Bush's failure to act in 2005. Sounds plausible until you actually look at the...

www.realclearmarkets.com

 

[Robert W]

READ THE DAMN POSIT DUMMY

Wall Street firms, including Bear Stearns, Lehman Brothers, and Goldman Sachs, aggressively purchased, bundled, and sold subprime mortgages into securities (MBS/CDOs) to meet investor demand. When the housing bubble burst and defaults soared in 2007, the market collapsed, leaving banks holding billions in toxic debt, triggering the subprime mortgage crisis. "



You know TRANCHES

I knew all about Lehman and loans. They bought or started many loan firms. They could have also bought loans from other smaller lenders. But Bush was not involved.

Don't Blame Bush for Subprime Mess | RealClearMarkets

Housing Crisis: A new report from the Associated Press claims that the mortgage meltdown is due largely to President Bush's failure to act in 2005. Sounds plausible until you actually look at the...

www.realclearmarkets.com

 

[JonKoch]

Bush to stop it had to veto changes. Democrats put the brakes on changes. Bush got nothing to agree to thanks to Democrats.

Don't Blame Bush for Subprime Mess | RealClearMarkets

Housing Crisis: A new report from the Associated Press claims that the mortgage meltdown is due largely to President Bush's failure to act in 2005. Sounds plausible until you actually look at the...

www.realclearmarkets.com

View attachment 1243550

BUSH HAD A GOP HOUSE JAN 201 UNTIL JAN 2007, THE ONLY BILL TO MAKE IT OUT OF THE GOP CONTROLLED HOUSE, DUBYA OPPOSED. THE DEMOCRATS CAN'T STOP A SINGLE THING IN THE MINORITY IN THE HOUSE


The only bill that made it to the Senate, never got out of the GOP controlled committee in 2005, DUBYA OPPOSED IT




YOR BS TALKING POINTS LINK, THAT DUYA COULDN'T GET DEMOCRATS ON HIS SIDE, WHEN HE COULD GET 2 UNFUNDED TAX CUTS, 2 UNFUNDED WARS, UNFUNDED MEDICARE EXPANSION BUT COULDN'T GET THE GOP HOUSE TO LET HIM HAVE REFORM OF GSE'S? THINK

DUBYA WAS THE OVERSIGHT OF FANNIE AND FREDDIE DUMMY

 

[JonKoch]

I knew all about Lehman and loans. They bought or started many loan firms. They could have also bought loans from other smaller lenders. But Bush was not involved.

Don't Blame Bush for Subprime Mess | RealClearMarkets

Housing Crisis: A new report from the Associated Press claims that the mortgage meltdown is due largely to President Bush's failure to act in 2005. Sounds plausible until you actually look at the...

www.realclearmarkets.com

That year, President Bush's HUD ratcheted up the main affordable-housing goal over the next four years, from 50 percent to 56 percent. John C. Weicher, then an assistant HUD secretary, said the institutions lagged behind even the private market and "must do more."



For Wall Street, high profits could be made from securities backed by subprime loans. Fannie and Freddie targeted the least-risky loans. Still, their purchases provided more cash for a larger subprime market.


"That was a huge, huge mistake," said Patricia McCoy, who teaches securities law at the University of Connecticut. "That just pumped more capital into a very unregulated market that has turned out to be a disaster."

https://archive.ph/ZhfIA#selection-549.0-561.215

2004 Dubya allowed the leverage rules to go from 12-1 to 35-1+ which flooded the market with cheap money!



Predatory Lenders' Partner in Crime

Predatory lending was widely understood to present a looming national crisis.

What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge?

Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative


The "turmoil in financial markets clearly was triggered by a dramatic weakening of underwriting standards for U.S. subprime mortgages, beginning in late 2004 and extending into 2007," the President's Working Group on Financial Markets OCT 2008

 

[JonKoch]

Bush to stop it had to veto changes. Democrats put the brakes on changes. Bush got nothing to agree to thanks to Democrats.

Don't Blame Bush for Subprime Mess | RealClearMarkets

Housing Crisis: A new report from the Associated Press claims that the mortgage meltdown is due largely to President Bush's failure to act in 2005. Sounds plausible until you actually look at the...

www.realclearmarkets.com

View attachment 1243550

Simple. HOW DOES THE DEMOCRATS, AS THE MINORITY IN THE GOP MAJORITY HOUSE JAN 1995-JAN 2007, STOP ANYTHING THE GOP WANTS TO MOVE TO THE SENATE?



Weird ONLY one GSE reform bill came out of the GOP controlled House 2001-Jan 2007, Dubya opposed it in the Senate? HMM

 

[alang1216]

So, this is more of along the lines that since you can't take it with you, we (the government) should take what we want, leave you a little, and call it square. What you're doing is what I would call "pocket watching". Envy or jealousy works as well. In life, you have "life's lottery winners". Normal people go about their lives without thinking about what the kids of billionaires & millionaires do. Those who have little going on for themselves or those trying to buy votes think about ways to get money from those who have it.

You can't take it with you so spend it while you're here where it will do some good for the country and not just your gene pool.

 

[JonKoch]

Bush to stop it had to veto changes. Democrats put the brakes on changes. Bush got nothing to agree to thanks to Democrats.

Don't Blame Bush for Subprime Mess | RealClearMarkets

Housing Crisis: A new report from the Associated Press claims that the mortgage meltdown is due largely to President Bush's failure to act in 2005. Sounds plausible until you actually look at the...

www.realclearmarkets.com

View attachment 1243550

DEMOCRATS GET THE HOUSE JAN 2007





The Federal Housing Finance Reform Act of 2007 (H.R. 1427), passed by the House in May 2007, aimed to strengthen regulation of Fannie Mae and Freddie Mac by creating a new independent regulator, the Federal Housing Finance Agency (FHFA). It sought to increase oversight, manage portfolio risks, and establish an affordable housing fund.
Key Aspects of the 2007 Reform Efforts:

• Legislative Action: H.R. 1427 was passed by the House Financial Services Committee in March 2007 and passed the full House on May 22, 2007, with a vote of 313-104.

• Regulatory Overhaul: The bill aimed to replace the Office of Federal Housing Enterprise Oversight (OFHEO) with a stronger, independent regulator (FHFA) empowered to manage GSE portfolios and capital requirements.

• GSE Oversight: The legislation demanded tighter controls over Fannie Mae and Freddie Mac's investments and risk management as calls for reform grew following, and during, the subprime mortgage crisis.

• Affordable Housing Fund: A controversial aspect of the bill was the creation of a fund for affordable housing initiatives, which some critics argued was a distraction from safety and soundness concerns.

• Outcome: Although passed by the House in 2007, this specific bill did not become law in 2007. However, the momentum led to the ultimate passage of the Federal Housing Finance Regulatory Reform Act of 2008 following the conservatorship of the GSEs

 

[Toddsterpatriot]

Gawd, LEARN READING COMPREHENSION.

There was CONFORMING LOANS (Met Gov't UNDERWRITING standards for HUD, VA, FHA, ETC)

THEN there were GSE UNDERWITING STANDARDS that BILL CLINTON restricted in 2000 that GSE's (FANIE/FREDDIE)


HUD (2000) 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. Freddie and Fannie adopted policies not to buy some high-cost loans.


GSE's had the highest standards, UNTIL they started chasing the PLS market (WALL STREET) to th bottom in 2006, AS I'VE linked repeatedly

Fannie /Freddie to get backing from the Gov't had to meet affordability goals, BUT UNTIL Dubya loosened them in 2001-2004, REQUIRED F/F to buy $440 MBS's and CDO's AND upped the goals from 50% to 56%, the GSE's were doing ok.

EVEN DUBYA'S GUY SAID SO IN 2004



March 5, 2004, hearing of the House Committee on Financial Services, titled "The Treasury Department's Views on the Regulation of Government Sponsored Enterprises"



Testimony from W's Treasury Secretary John Snow to the REPUBLICAN CONGRESS concerning the 'regulation of the GSE's (FANNIE/FREDDIE) 2004

Mr. (BARNEY) Frank: ...Are we in a crisis now with these entities?

Secretary Snow. No, that is a fair characterization, Congressman Frank, of our position. We are not putting this proposal before you because of some concern over some imminent danger to the financial system for housing; far from it.





WHAT HAPPENED? READ A GRAPH?



View attachment 1243540

THEN there were GSE UNDERWITING STANDARDS that BILL CLINTON restricted in 2000 that GSE's (FANIE/FREDDIE)

But he never did.

 

[Robert W]

Simple. HOW DOES THE DEMOCRATS, AS THE MINORITY IN THE GOP MAJORITY HOUSE JAN 1995-JAN 2007, STOP ANYTHING THE GOP WANTS TO MOVE TO THE SENATE?

Democrats were running the house for two of those years.
The so-called loan crisis hit very fast and once it hit, it lasted several years.

It is very clear to me you never made an income handling loans for homes.

All utterly wrong.

Here at IBD, we've done more than a dozen pieces — most recently, in yesterday's paper — detailing how rewrites of the Community Reinvestment Act in 1995 under President Clinton, along with major regulatory changes pushed by the White House in the late 1990s, created the boom in subprime lending, the surge in exotic and highly risky mortgage-backed securities, and the housing boom whose government-fed excesses led to inevitable collapse.

Despite this clear record, we're now besieged by enterprising journalists blaming Republican "deregulation" or the president's failure to recognize the seriousness of the problem or act. But these claims fall apart, as a partial history of the last decade shows.

Bush's first budget, written in 2001 — seven years ago — called runaway subprime lending by the government-sponsored enterprises Fannie Mae and Freddie Mac "a potential problem" and warned of "strong repercussions in financial markets."

In 2003, Bush's Treasury secretary, John Snow, proposed what the New York Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." Did Democrats in Congress welcome it? Hardly.

"I do not think we are facing any kind of a crisis," declared Rep. Barney Frank, D-Mass., in a response typical of those who viewed Fannie and Freddie as a party patronage machine that the GOP was trying to dismantle. "If it ain't broke, don't fix it," added Sen. Thomas Carper, D-Del.

Unfortunately, it was broke.

In November 2003, just two months after Frank's remarks, Bush's top economist, Gregory Mankiw, warned: "The enormous size of the mortgage-backed securities market means that any problems at the GSEs matter for the financial system as a whole." He too proposed reforms, and they too went nowhere.

In the next two years, a parade of White House officials traipsed to Capitol Hill, calling repeatedly for GSE reform. They were ignored. Even after several multibillion-dollar accounting errors by Fannie and Freddie, Congress put off reforms.

In 2005, Fed chief Alan Greenspan sounded the most serious warning of all: "We are placing the total financial system of the future at a substantial risk" by doing nothing, he said. When a bill later that year emerged from the Senate Banking Committee, it looked like something might finally be done.

Unfortunately, as economist Kevin Hassett of the American Enterprise Institute has noted, "the bill didn't become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter."

Had they done so, it's likely the mortgage meltdown wouldn't have occurred, or would have been of far less intensity. President Bush and the Republican Congress might be blamed for many things, but this isn't one of them. It was a Democratic debacle, from start to finish.

.

 

[Toddsterpatriot]

LEARN WHAT PLS AND GSE WERE. They basically did the same thing, BUT Fannie and Freddie, UNTIL Dubya, had strict underwriting standards, MOST NINJA loans, NOT qualified for Gov't backing, including F/F

Which is why PLS (wall street) bought and bundled the bad mortgages and sold them off UNTIL they couldn't in late 2007 and had to start holding them, THEN we saw what happened


"
Wall Street firms, including Bear Stearns, Lehman Brothers, and Goldman Sachs, aggressively purchased, bundled, and sold subprime mortgages into securities (MBS/CDOs) to meet investor demand. When the housing bubble burst and defaults soared in 2007, the market collapsed, leaving banks holding billions in toxic debt, triggering the subprime mortgage crisis. "


This process created a "vicious cycle" where demand for high-yield securities drove up the creation of risky loans (subprime). Banks often sold these high-risk mortgages to institutional investors, including pension funds, while retaining high-risk tranches that ultimately made them insolvent.

Key developments included:


2006–2007: Housing prices began to fall, leading to high default rates on subprime mortgages.


Early 2007: Major lenders like New Century Financial Corp. went bankrupt.


July 2007: Bear Stearns announced two hedge funds, heavily invested in MBS, had collapsed.


End Result: The inability to sell these bad debts resulted in massive bank losses, a total freeze of credit markets, and the 2008 financial crisis.


As home prices declined, borrowers could not refinance, leading to massive foreclosures and the collapse of the financial derivatives market that had spread the risk globally.

LEARN WHAT PLS AND GSE WERE. They basically did the same thing, BUT Fannie and Freddie, UNTIL Dubya, had strict underwriting standards,

Until 1992.

Which is why PLS (wall street) bought and bundled the bad mortgages and sold them off

Sold some to commercial banks, to meet their CRA requirements.
Sold some to Fannie and Freddie.
Sold some to everybody else.

 

[Toddsterpatriot]

Another lie from you, I'm shocked, no really I am Cupcake


Government-Sponsored Enterprises (GSEs) like Fannie Mae and Freddie Mac generally maintained better loan quality than Private Label Securities (PLS) subprime loans, particularly in the lead-up to the 2008 housing crisis.



While both markets saw declining standards, studies show that mortgages included in GSE securitizations performed better than those in private-label securities, especially when holding observable risk factors (like borrower credit scores) constant.


Key Reasons for Higher Quality GSE Loans:

• Conforming Standards: GSEs only purchased "conforming" mortgages, which are required to meet specific underwriting standards regarding borrower FICO scores, debt-to-income (DTI) ratios, and loan-to-value (LTV) ratios.

• Reduced Risk Factors: Compared to PLS, GSE loans traditionally featured fewer high-risk, "exotic" characteristics such as, low-documentation loans, prepayment penalties, and interest-only features.

• Performance Differences: During the 2008 crisis, subprime loans, often packaged in PLS, accounted for a disproportionate amount of foreclosure starts (e.g., 48.2% in Q2 2008), while GSE-guaranteed loans generally sustained fewer defaults.

• Higher Average Credit Scores: Even during the pandemic era, GSE loans have maintained the highest average credit scores of all loan types (around 774) compared to FHA or private-label loans.

Subprime May Not Have Caused the 2000s Housing Crisis: Evidence from Cleveland, Ohio

During the 2000s housing bust, Cleveland’s Slavic Village was dubbed “ground zero of the foreclosure crisis” by the national media. Despite this, during the preceding housing boom Cleveland had stable house price growth and relatively low mortgage debt growth, a stark contrast to circumstances...

www.clevelandfed.org

Exceptions and Nuance:

• Rising Risk Tolerance: While better than PLS, the GSEs did increase their own risk-taking in the mid-2000s by buying more ALT-A and higher-risk loans to compete with the expanding private market.

• Underwriting Differences: Private lenders and issuers that depended on GSEs to purchase their loans often had to adopt the strict guidelines of the GSEs, setting a higher bar for quality than subprime-only lenders

https://files.stlouisfed.org/files/htdocs/conferences/gse/Van_Order.pdf

Government-Sponsored Enterprises (GSEs) like Fannie Mae and Freddie Mac generally maintained better loan quality than Private Label Securities (PLS) subprime loans, particularly in the lead-up to the 2008 housing crisis.

Because they still bought some conforming loans.
They still ended up with nearly $2 trillion of subprime crap.

While better than PLS, the GSEs did increase their own risk-taking in the mid-2000s by buying more ALT-A and higher-risk loans to compete with the expanding private market.

And to meet their HUD mandates.

 

[Toddsterpatriot]

LMAOROG. Ok you don't know what PLS means. Got it

DURR

 

[Robert W]

You can't take it with you so spend it while you're here where it will do some good for the country and not just your gene pool.

If you think you will die by age 65, (pick the age of your choosing) and you blew your savings, what will you do in case you live to be my age of 87?

 

[alang1216]

If you think you will die by age 65, (pick the age of your choosing) and you blew your savings, what will you do in case you live to be my age of 87?

We're all in that boat. Me, I'm going to keep at least one billion in case I lived to be 187. If I didn't need it after all I might donate it in my will to a worthy cause.