Bush's Place in History.

[DuncanONeil]

"Bush is not responsble for the Sub Prime Crisis, the Banks are,"

Sorry I can not agree that the fault lies with the banks. I must lay the blame on the Democrat Congress that required banks to set aside sound loan practices and lend money to people that were a poor risk for paying the loan off.
Then there are the people that took advantage of attractive rates to refinance their home to put money in their pocket. Being "underwater" in a home is not the same as other things. Underwater in a car you are on the wrong side of a liability. A home is an asset.

[Belgarold]

"Bush is not responsble for the Sub Prime Crisis, the Banks are,"

Sorry I can not agree that the fault lies with the banks. I must lay the blame on the Democrat Congress that required banks to set aside sound loan practices and lend money to people that were a poor risk for paying the loan off.
Then there are the people that took advantage of attractive rates to refinance their home to put money in their pocket. Being "underwater" in a home is not the same as other things. Underwater in a car you are on the wrong side of a liability. A home is an asset.

um, The Congress was decidedly Republican when the regulations were stripped from the banking industry. And No laws REQUIRED lenders to lend to poor risk lenders.

The poor risk lending was made by unscrupulous lenders wishing to make a fast book over making loans to ignorant lendees.

Your information here is COMPLETELY false.

[DuncanONeil]

There are two governing laws:

• The Fair Housing Act of 1968
• The Community Reinvestment Act of 1977

The make up in both of the Congresses of the time was majority Democrat in both houses! By ratios even higher than today;

• 90th Congress
  
  • Senate -- 64(D) 36(R)
  • House -- 247 (D) 187 (R)
• 95th Congress
  
  • Senate -- 61(D) 39(R)
  • House -- 292(D) 143(R)

So to try to blame this on the Republican party does not comport with the facts.

Further, to make it a violation of law to not give loans to persons in a certain area or certain type, without regard to any reason, is exactly the same as saying; "you must lend even if they look like a bad risk. Fail to do so at your own peril! Do not forget we control your existence as a business!"

um, The Congress was decidedly Republican when the regulations were stripped from the banking industry. And No laws REQUIRED lenders to lend to poor risk lenders.

The poor risk lending was made by unscrupulous lenders wishing to make a fast book over making loans to ignorant lendees.

Your information here is COMPLETELY false.

[SadisticNature]

There are two governing laws:

• The Fair Housing Act of 1968
• The Community Reinvestment Act of 1977

The make up in both of the Congresses of the time was majority Democrat in both houses! By ratios even higher than today;

• 90th Congress
  
  • Senate -- 64(D) 36(R)
  • House -- 247 (D) 187 (R)
• 95th Congress
  
  • Senate -- 61(D) 39(R)
  • House -- 292(D) 143(R)

So to try to blame this on the Republican party does not comport with the facts.

Further, to make it a violation of law to not give loans to persons in a certain area or certain type, without regard to any reason, is exactly the same as saying; "you must lend even if they look like a bad risk. Fail to do so at your own peril! Do not forget we control your existence as a business!"

http://seekingalpha.com/article/7126...tion-gone-wild

This is a partial list of some of the policies that led to the too big to fail situation that caused the bailouts.

It starts with the 1982 Garn -St. Germain Depository Institutions Act.

As the eighties wore on the economy appeared to grow. Interest rates continued to go up as well as real estate speculation. The real estate market was in what is known as a "boom" mode. Many S&L's took advantage of the lack of supervision and regulations to make highly speculative investments, in many cases loaning more money then they really should. Not because they were required to, but motivated by profits.

When the real estate market crashed, and it did so in dramatic fashion, the S&L's were crushed. They now owned properties that they had paid enormous amounts of money for but weren't worth a fraction of what they paid. Many went bankrupt, losing their depositors money. This was known as the S&L Crisis. In 1980 the US had 4,600 thrifts, by 1988 mergers and bankruptcies left 3000. By the mid 1990's less than 2000 survived.

The S&L crisis cost about 600 Billion dollars in "bailouts." This is 1500 dollars from every man woman and child in the US. This was the February 1989 bailout under the first Bush.

Despite this deregulation causing a huge crash and bailout, the process of deregulation was continued leading to the repeal of the Glass-Steagal act by 1998 (After 25 attempts and $300 million in lobbying).

In the spring of 1987, the Federal Reserve Board votes 3-2 in favor of easing regulations under Glass-Steagall Act, overriding the opposition of Chairman Paul Volcker. Thomas Theobald, then vice chairman of Citicorp, argues that three "outside checks" on corporate misbehavior had emerged since 1933: "a very effective" SEC; knowledgeable investors, and "very sophisticated" rating agencies. Volcker is unconvinced, and expresses his fear that lenders will recklessly lower loan standards in pursuit of lucrative securities offerings and market bad loans to the public. For many critics, it boiled down to the issue of two different cultures - a culture of risk which was the securities business, and a culture of protection of deposits which was the culture of banking.

Volcker had it right, but this opposition led to him being replaced by Alan Greenspan.

The problem was the banks owned too much property. Why? Because people removed the regulations preventing it. It's not one or two property acts that are trying to limit discrimination that caused the problems.

If the banks were giving out loans they knew in advance were bad, they never would have appealed to have more and more restrictions reduced. They were giving out loans they thought they could make money on, and were leveraged beyond belief. Yet the record shows the continuously appealed to the government to let them leverage more and more.

It's no surprise that the first to go was Bear Stearns, one of the first to lobby for and get limits removed.

http://newsmine.org/content.php?ol=c...ngency-fee.txt

CHICAGO -- In a CNSNews (www.CNSNews.com) nationally-syndicated story published on Monday, Illinois Republican National Committeeman Bob Kjellander once again defended the $800,000 contingency fee he received earlier this year from Bear Stearns, the bond house that handled Governor Rod Blagojevich's $10 billion mortgage to balance Illinois' FY 2004 budget.

It's also a matter of fact that the lobbyists for Bear Stearns and the deregulation involved in the matter were active republican party members.

So yes, it does correspond to the facts to blame the republican party for this. It just doesn't correspond to your personal world view.

[DuncanONeil]

You absolutely refuse to consider the fact that Congressional action REQUIRING banks to lend in areas where the residents could not meet the standard of being an acceptable risk.
This categorical refusal to consider a proximate cause and only deal with the after effects is disingenuous at best.

http://seekingalpha.com/article/7126...tion-gone-wild

This is a partial list of some of the policies that led to the too big to fail situation that caused the bailouts.

It starts with the 1982 Garn -St. Germain Depository Institutions Act.

As the eighties wore on the economy appeared to grow. Interest rates continued to go up as well as real estate speculation. The real estate market was in what is known as a "boom" mode. Many S&L's took advantage of the lack of supervision and regulations to make highly speculative investments, in many cases loaning more money then they really should. Not because they were required to, but motivated by profits.

When the real estate market crashed, and it did so in dramatic fashion, the S&L's were crushed. They now owned properties that they had paid enormous amounts of money for but weren't worth a fraction of what they paid. Many went bankrupt, losing their depositors money. This was known as the S&L Crisis. In 1980 the US had 4,600 thrifts, by 1988 mergers and bankruptcies left 3000. By the mid 1990's less than 2000 survived.

The S&L crisis cost about 600 Billion dollars in "bailouts." This is 1500 dollars from every man woman and child in the US. This was the February 1989 bailout under the first Bush.

Despite this deregulation causing a huge crash and bailout, the process of deregulation was continued leading to the repeal of the Glass-Steagal act by 1998 (After 25 attempts and $300 million in lobbying).

In the spring of 1987, the Federal Reserve Board votes 3-2 in favor of easing regulations under Glass-Steagall Act, overriding the opposition of Chairman Paul Volcker. Thomas Theobald, then vice chairman of Citicorp, argues that three "outside checks" on corporate misbehavior had emerged since 1933: "a very effective" SEC; knowledgeable investors, and "very sophisticated" rating agencies. Volcker is unconvinced, and expresses his fear that lenders will recklessly lower loan standards in pursuit of lucrative securities offerings and market bad loans to the public. For many critics, it boiled down to the issue of two different cultures - a culture of risk which was the securities business, and a culture of protection of deposits which was the culture of banking.

Volcker had it right, but this opposition led to him being replaced by Alan Greenspan.

The problem was the banks owned too much property. Why? Because people removed the regulations preventing it. It's not one or two property acts that are trying to limit discrimination that caused the problems.

If the banks were giving out loans they knew in advance were bad, they never would have appealed to have more and more restrictions reduced. They were giving out loans they thought they could make money on, and were leveraged beyond belief. Yet the record shows the continuously appealed to the government to let them leverage more and more.

It's no surprise that the first to go was Bear Stearns, one of the first to lobby for and get limits removed.

http://newsmine.org/content.php?ol=c...ngency-fee.txt

CHICAGO -- In a CNSNews (www.CNSNews.com) nationally-syndicated story published on Monday, Illinois Republican National Committeeman Bob Kjellander once again defended the $800,000 contingency fee he received earlier this year from Bear Stearns, the bond house that handled Governor Rod Blagojevich's $10 billion mortgage to balance Illinois' FY 2004 budget.

It's also a matter of fact that the lobbyists for Bear Stearns and the deregulation involved in the matter were active republican party members.

So yes, it does correspond to the facts to blame the republican party for this. It just doesn't correspond to your personal world view.

[SadisticNature]

You absolutely refuse to consider the fact that Congressional action REQUIRING banks to lend in areas where the residents could not meet the standard of being an acceptable risk.
This categorical refusal to consider a proximate cause and only deal with the after effects is disingenuous at best.

You categorically refuse to consider the fact that the institutions that failed were trying to make more of these high risk lousy loans to the point where they were lobbying to have lending limits repealed.

You blame government for businesses making bad loans when the entirety of the evidence on record says those businesses wanted to make those loans, to the point of spending $300 million on lobbying to repeal regulations preventing them from making risky loans.

I've also addressed the evidence you and others have presented on this point repeatedly. The only categorical denial occurring here is the one you are making.

[DuncanONeil]

Were it true that lenders "wanted to make those loans" there would have been no need for legislation to require lenders to grant loans to those they had determined were high risk! Because it happened after said legislation has no bearing on how it came about!

Your choice to refuse to consider the underlying legislation is troubling. Seems as if you, like others, are inclined to demonize a specific entity for some specific purpose.

The head of GMAC (controlled by the Government) received a compensation package exactly the same as, I believe, head of Smith Varney. Yet The head of Smith Varney was excoriated for his salary. Not one word about the head of GMAC, even though it is hemoraging money in the smae fashion!

You categorically refuse to consider the fact that the institutions that failed were trying to make more of these high risk lousy loans to the point where they were lobbying to have lending limits repealed.

You blame government for businesses making bad loans when the entirety of the evidence on record says those businesses wanted to make those loans, to the point of spending $300 million on lobbying to repeal regulations preventing them from making risky loans.

I've also addressed the evidence you and others have presented on this point repeatedly. The only categorical denial occurring here is the one you are making.

[SadisticNature]

You absolutely refuse to consider the fact that Congressional action REQUIRING banks to lend in areas where the residents could not meet the standard of being an acceptable risk.
This categorical refusal to consider a proximate cause and only deal with the after effects is disingenuous at best.

This statement is outright false. I have addressed why those legislations are not the problem. Your attempt to blame select legislation on flimsy and inaccurate evidence so that you can avoid the actual source of blame is disingenuous at best. The fact is deregulation caused these problems, not specific regulations you point to, which don't even apply to INVESTMENT BANKS, the actual organizations pushing subprime mortgages.

You refuse to even address any of the issues I raised as relevant to the cause. I'd suggest taking a long hard look at the quality of your sources.

Relying on information presented by the only "NEWS" organization to win a Whistleblower case (on appeal) on the basis of "falsifying the news is not a crime" is problematic at best.

[SadisticNature]

You might want to actually read these laws before you cry foul.

http://www.hud.gov/offices/fheo/FHLaws/yourrights.cfm

The conditions of the fair housing act merely say you can't refuse a loan based on race. This means if a bank extends a loan to a white person who has a certain risk factor you can't refuse to extend the same loan to a black person with the same risk factor.

There is a difference between refusing a loan BASED on race, and refusing a loan to a minority.

The community reinvestment act of 1977 is more complicated, and there are some potential concerns here. That being said, the assets resulting from such practices were graded AAA, and sold around the financial world like hotcakes.

I have a specific questions for you Duncan, so stop the dodging and try and give them honest answers:

1) If these assets were as toxic as you describe why were banks trying to buy them from each other, well beyond their legal obligations to any act?

2)Why were they lobbying (successfully) to get their credit limits increased and then buying up more and more of these assets?

The only answer I've found that's consistent with the facts is this one:

Subprime loans were so profitable, that they were aggressively marketed in low-and moderate-income communities, even over the objections and warnings of housing advocacy groups like ACORN.

Which you can find either here:
http://en.wikipedia.org/wiki/Community_Reinvestment_Act

or

http://www.innercitypress.com/cra1bailout092808.html


Even more telling is this:

There's a major factual problem, though: with a single exception, no bank sought CRA credit for its subprime loans. And the investment banks which were purchasing, bundling and securitizing the loans were not covered by CRA.

There are two governing


laws:

• The Fair Housing Act of 1968
• The Community Reinvestment Act of 1977

The make up in both of the Congresses of the time was majority Democrat in both houses! By ratios even higher than today;

• 90th Congress
  
  • Senate -- 64(D) 36(R)
  • House -- 247 (D) 187 (R)
• 95th Congress
  
  • Senate -- 61(D) 39(R)
  • House -- 292(D) 143(R)

So to try to blame this on the Republican party does not comport with the facts.

Further, to make it a violation of law to not give loans to persons in a certain area or certain type, without regard to any reason, is exactly the same as saying; "you must lend even if they look like a bad risk. Fail to do so at your own peril! Do not forget we control your existence as a business!"

[DuncanONeil]

You might want to actually read these laws before you cry foul.

http://www.hud.gov/offices/fheo/FHLaws/yourrights.cfm

The conditions of the fair housing act merely say you can't refuse a loan based on race. This means if a bank extends a loan to a white person who has a certain risk factor you can't refuse to extend the same loan to a black person with the same risk factor.

That is not quite accurate. The requirement was to grant loans in specific neighborhoods that were determined to be underserved at the same rate as the neighborhoods that were deemed appropriately served.

By the way your citation is not the law!

There is a difference between refusing a loan BASED on race, and refusing a loan to a minority.

The community reinvestment act of 1977 is more complicated, and there are some potential concerns here. That being said, the assets resulting from such practices were graded AAA, and sold around the financial world like hotcakes.

I have a specific questions for you Duncan, so stop the dodging and try and give them honest answers:

1) If these assets were as toxic as you describe why were banks trying to buy them from each other, well beyond their legal obligations to any act?

2)Why were they lobbying (successfully) to get their credit limits increased and then buying up more and more of these assets?

The only answer I've found that's consistent with the facts is this one:

Subprime loans were so profitable, that they were aggressively marketed in low-and moderate-income communities, even over the objections and warnings of housing advocacy groups like ACORN.

Which you can find either here:
http://en.wikipedia.org/wiki/Community_Reinvestment_Act

or

http://www.innercitypress.com/cra1bailout092808.html


Even more telling is this:

There's a major factual problem, though: with a single exception, no bank sought CRA credit for its subprime loans. And the investment banks which were purchasing, bundling and securitizing the loans were not covered by CRA.