The Boston Globe reported today...
The roots of this crisis go back to the Carter administration. That was when government officials, egged on by left-wing activists, began accusing mortgage lenders of racism and "redlining" because urban blacks were being denied mortgages at a higher rate than suburban whites.
The pressure to make more loans to minorities (read: to borrowers with weak credit histories) became relentless. Congress passed the Community Reinvestment Act, empowering regulators to punish banks that failed to "meet the credit needs" of "low-income, minority, and distressed neighborhoods." Lenders responded by loosening their underwriting standards and making increasingly shoddy loans. The two government-chartered mortgage finance firms, Fannie Mae and Freddie Mac, encouraged this "subprime" lending by authorizing ever more "flexible" criteria by which high-risk borrowers could be qualified for home loans, and then buying up the questionable mortgages that ensued.
All this was justified as a means of increasing homeownership among minorities and the poor. Affirmative-action policies trumped sound business practices.
"Lack of credit history should not be seen as a negative factor," the Fed's guidelines instructed. Lenders were directed to accept welfare payments and unemployment benefits as "valid income sources" to qualify for a mortgage. Failure to comply could mean a lawsuit.
But his fingerprints are all over this fiasco. Time and time again, Frank insisted that Fannie Mae and Freddie Mac were in good shape. Five years ago, for example, when the Bush administration proposed much tighter regulation of the two companies, Frank was adamant that "these two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis." When the White House warned of "systemic risk for our financial system" unless the mortgage giants were curbed, Frank complained that the administration was more concerned about financial safety than about housing.
Now that the bubble has burst and the "systemic risk" is apparent to all, Frank blithely declares: "The private sector got us into this mess." Well, give the congressman points for gall. Wall Street and private lenders have plenty to answer for, but it was Washington and the political class that derailed this train. If Frank is looking for a culprit to blame, he can find one suspect in the nearest mirror.
Granting loans to minorities. Pressuring banks to give loans to people without credit worthiness threatening lawsuits from Barak Obama's group called ACORN.
See the plot thickens now when you see the full picture, and the liberal media actually doing what it is paid to do. Investigate the truth without taking sides.
For too long the liberal media has blamed the Bush administration, meanwhile through the back door, Democratic leaders like Christopher Dood, and Barney Frank were sabotaging our financial stability and single handily crashed the housing market in the United States for years to come.
Democrats can blame the eight years of Bush's failed economic policies all they want.
Now, behold, the truth and the whole truth is coming out and it is the governments interfering with the banking system, and forcing banks to loan money to minority borrowers who did not qualify, threatening racial lawsuits and monetary judgments.
All in the name of the glorious Marxist, socialism plan of Barney Frank, Christopher Dodd and yes, Barak Obama and his ties to ACORN who were the very firm that threatened lawsuits and received monetary paypacks for putting pressure on the FED'S to loan the money to minorities.
Change...this is the change Barak Obama is calling for?
Visit My Website
Search South Florida Homes for Sale
SOCIALISM
Barney Frank has been found, in more than one occasion to say that Freddie Mac and Fannie Mae were not in crisis, and he and his cronies resisted any calls for oversight.
And...who was covering up for this mess?
How can anyone say he and his friends weren't involved and that they didn't have any kind of influence in this mess?
For example: Maxine Waters very clearly states "we're trying to fix something that isn't broke....there is no Freddie Mac and Fannie Mae crisis....under the outstanding leadership of Raines..."
Hugh ~ Right On, brother. Marxism which leads to socialism in this country, the moment it happened it was doomed to fail and cost this country and taxpayers 700 billion dollars!
Pacita ~ Wow, great information. Keep it coming. You are a true patriot. God Bless!
There needs to be an investigation and Mr. Frank needs to be the first one in front of America answering to the people. I don't care if it is a businessman or a congressman - if they are found to be at fault they need to be brought to justice. The finger pointing needs to stop and the investigation needs to start.
You want change? VOTE and encourage others to do the same. If even 50% of Americans exercised their rights, we would see a profound difference.
Thanks Tim and Pam ~ I for one am voting, and I have since I was given the priviledge. Thanks for stopping by.
Nicholas did you see Bill O'Reilly blasting Barney: http://www.youtube.com/watch?v=RAuOEdttjZQ
Somehow the picture of Frank squirming and whining before a investigative committtee is stuck in my mind.......Will it really happen? :)
Nick - I believe there is a class action lawsuit back in the early 90s - lead by a lawyer listed as Barack H Obama against I think it was CitiGroup on this subject. I am finding it hard to get the information, but you know I will!
Nick ~
Congratulations this post is now featured in the Blatant Politics Group of Active Rain.
Nick ~
Congratulations this post is now featured in the Real Estate Professionals for John McCain Group of Active Rain.
Nicholas,
Some confuse dregulation with lack of government oversight!!! Thanks, Fran
From Powerlineblog.com, instapundit.com, and others....the NRC has released this ad, which briefly and pretty effectively recounts the background on the current housing and financial crisis.
What happened?
Nicholas,
Good insight on your post here. I am soooooo tired of hearing the same old line from the Democrat/Obama camp... you know, "The Failed Bush Policies". The democrates fingerprints are all over this mess. In my gut, I feel there is a conspiracy going on here. What I mean is, with McCain gaining ground 40 days before the election, someone (most likely) foreign investors said they didn't want another Republican administration, so they strong armed the Bush administration by threatening not to buy our debt any longer. This pushes the economy front and center, forget national security, gas prices or the war the republicans have blown up the economy!
You can not tell me that the elite economic think tanks that lurk behind the scenes in and around the beltway didn't know how fragile the economy was and didn't push the buttons right down the home stretch!
Maybe I'm crazy, but maybe I'm not!!
Barney Fudd you mean?
I laughed at Bill O getting mad at him today.
We are all pretty fed up and at the end of our tempers right now. Me included.
Simon that's interesting. I've said all along our problems with all the bad loans is of the Democrats doings. I don't know why the liberal marxist media continues to try to lay the blame on Republicans and do everything they can to give Obama a free pass. He will never be asked his involvement in this. I googled it and found this:
Nicholas - there is also news starting to trickle out that Barney may have a conflict of interest here. His lover partner for 10 years was an executive at Fannie.
Brenda - nice work!
OK folks, 30 days to go - GAME ON!
Nick - I find this most interesting that it is coming from the Boston Globe which could never be considered remotely a conservative, or republican or right leaning paper.
I do want to address one thing, though, it wasn't just granting loans to minorities, it was to all low-income people, of which the highest number during this period was caucasian. Unfortunately, these same non-standards trickled up to higher income buyers.
Mike ~ You are correct, but the lawsuits started with minorities and then the flood gates opened.
Brenda~ You should make that a post sister, that is feature material.
Susan ~ Keep fighting the good fight with us, I have been branded the worst person in AR. SO BE CAREFUL.
Cheri ~ You are truly a warrior.
Rick ~ You are not crazy, but enlightened. You are actually getting your information in spite of the liberal media...lol
Pacita ~ You are a new comer to the fight, but you are so welcomed. Welcome to the BATTLE!
Simon ~ As always you stand beside us and declare the truth as we know it. And that I am truly thankful.
Hi Nicholas:
Great post, and, unfortunately, you are touching only the tip of the iceberg. For years the federal and state governments have been passing laws/regulations that impose guidelines that add responsibilities to private sector entities. The regulations/requirements make the private sector fund programs that the government officials are looking to achieve, but don't want to fund with government money. A clever way to save taxpayer money (at least initially), but adding many additional costs for the private sector (including lenders and bankers).
Another thing that is not touched on today is the fact that the government, through the broken education system, sets up many for disaster. There is much talk of the fact that lenders have been preying on minorities, and the un-educated to enrich themselves. It's been a long time, but to my knowledge, schools are not teaching about how to balance checkbooks, maintain credit, and, in general, how to manage your financial affairs. As a lender, I am not preying on anybody: I make loans based on the loan characteristics of each file. The guidelines are not ones that I make up.
The guidelines we lenders are using are a function of the government entities that exist at the time: not what Wall Street covets. Barney Frank and his peers are reaping what they have sown (both parties). Frank and his cronies have used their positions of power to dumb down education systems and guidelines, and the results are available for all to see. It's too bad we are all seeing the results at one time, but maybe this mess will be the calamity that we need to get rid of these selfish, despicable people.
Hi Tom,
Unfortunately, I believe you are right. More information will come out, and yes after the election as to not do any harm to the messiah Obama.
I think you are implying that the media is in the tank for Obama, and I believe that is true. However, both sides of the aisle participated in the debacle. The lashing that O Reilly gave Frank was symptomatic of how mad people are at politicians of all political persuasions. I'm hoping that spanking is the beginning of people finally calling the "annointed class" on the carpet, and saying that "you serve the people: not the other way around."
The relationship between Barney Frank and his former partner Herb Moses of Fannie Mae should be perceived as a conflict of interest. http://www.businessandmedia.org/printer/2008/20080924145932.aspx
This article points out "While the relationship reportedly ended 10 years ago, Frank was serving on the House Banking Committee the entire 10 years they were together. The committee is the primary House body which along with the Office of Federal Housing Enterprise Oversight (OFHEO) has jurisdiction over the government-sponsored enterprises."
According to an article by Kathleen Day in the Oct. 8, 2003, Washington Post, Frank opposed giving the Bush administration the right to approve or disapprove business activities that "could pose risk to the taxpayers." He told the Post he worried the Treasury Department "would sacrifice activities that are good for consumers in the name of lowering the companies' market risks."
Just a month before, Frank had aggressively thwarted reform efforts by the Bush administration. He told The New York Times on Sept. 11, 2003, Fannie Mae and Freddie Mac's problems were "exaggerated," a gross miscalculation some five years later with costs estimated to be in the hundreds of billions.
"These two entities - Fannie Mae and Freddie Mac - are not facing any kind of financial crisis," Frank said to the Times. "The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."
Obviously the facts speak for themselves. Too bad the media is obsessed with the tearing and smearing Sarah Palin to notice...
Nicholas & Susan I wouldn't have looked for that case if Simon had not mentioned it so he should get the credit for it and do a thread if he wants to.
Pacita that's good work too. I heard what you just posted on a local conservative talk show today. Barney Frank needs to be prosecuted for the fleecing of America and the rest of the elected crooks too. The bail out Congress just passed is full of wasteful earmarks. How dumb is that in the face of a financial crisis.
Barney Frank needs to show some character and resign! I'm not in to conspiracy theories, but the timing of all this is very suspect.
Nick, Barney is truly the scum of the earth. Trust me, I live in Massachusetts. He is guilty all over the place along with Clinton.
Barney Frank needs to go to jail
So why isn't Brenda's find being brought out on any other station other than Fox news? Why is no one in mainstream media investigating Obama?
He not only represented ACORN, Obama also was hired to TRAIN their people in strong arm tactics. ACORN would make visits to the homes of bank executives, they would walk into board rooms and just stand there behind the members in a meeting, Obama was their trainer!
ACORN has the biggest voter fraud group busts ever. HMMMM, ACORN people work on Obama's campaign! Is that a coincidence? I think not.
Why do we not hear about this? Birds of a feather flock together.
The media dismissed Wright and the other minister.
The media dismisses Ayers! Yet, Ayers is the one who helped Obama become a 'community organizer', right from the Marx books that Ayers reads. Ayers intros Obama to the guy, can't remember his name, who is a hater of Israel and that man got Obama into Harvard Law school
What is in Obama's Thesis that he does not want us to see?
It is thought to be about us trying to disarm Russia, at the very time, that Reagan was doing so. Now I wonder his friends in the PLO, what was he really doing during his college days?
We are told to NOT pay attention to any of that!
Have you seen Susan's post with the link to what Obama's USA site would look like, you have to go and click that link.
http://activerain.com/blogsview/725017/USA-gov-Redux
Nick,
Only Tom Ash (above) has it right. Barney Frank is only a sympton; its the system that is at fault. Until we insist on campaign finance reform, term limits, third party access, true ethical standards for Congress and other reforms, we will never eliminate the Barney Franks of Washington. Until we get to "of the people," we will never get to "for the people".
I agree, we need more media attention on Obama's involvement in ACORN. An an investigation into ACORN's alleged attempts at voter fraud to throw this election.
I agree, we need more media attention on Obama's involvement in ACORN. An an investigation into ACORN's alleged attempts at voter fraud to throw this election.
Nick,
I appreciate your stand on what is right!