Bush raised red flags in April 2001. Dems said NO

[arkirk]

No, he's right about this.

Nobody was asked to make bad loans but they were given conflicting demands: make prudent loans and make enough loans to the community. The latter is far easier to measure, thus when the requirements conflict it's the one that's going to be followed.

Where he goes wrong is in ascribing the collapse to this. It was only the spark, not the inferno. The inferno was caused by those lax standards becoming widespread and a whole bunch of people jumping on the bandwagon, intending to flip properties.

I know I'm going to regret that, but Starman says it was loans to minorities that did it. You pretty much agree with the assessment.

So could you please, I know you won't as you never do, give a demographic showing household income distribution of homes lost in the recession. There is this odd thing you are denoting that seems to imply the middle class wasn't reaching beyond its means.

I can't pin the date down, but I do remember Bush saying something to the effect that the housing collapse was due to a whole lot of folks buying a lot of houses they couldn't afford. That's it...a whole lot of folks, not the bankers caused the crash. Got it?

 

[Loren Pechtel]

No, he's right about this.

Nobody was asked to make bad loans but they were given conflicting demands: make prudent loans and make enough loans to the community. The latter is far easier to measure, thus when the requirements conflict it's the one that's going to be followed.

Where he goes wrong is in ascribing the collapse to this. It was only the spark, not the inferno. The inferno was caused by those lax standards becoming widespread and a whole bunch of people jumping on the bandwagon, intending to flip properties.

Show me the evidence that anybody was instructed to make no check loans. Instructed by Barney Frank or any other Democrat. Evidence.

You are pulling this from your backside.

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

By itself this would have done little harm. We would all have ended up subsidizing loans in poor areas but the effect would be small. However, the market moved to most loans being sold to the government agencies. To make compliance with rule #2 possible these agencies relaxed their rules.

It was this relaxation that caused the catastrophe--rather than bankers forced into such loans there was a new breed exploiting the market. They knew they were writing crap but they didn't care because they were going to promptly resell the loans.

The whole market adapted to labeling crap as prime quality. That was what crashed our economy.

The CRA was the first spark but when things started to get out of hand Bush should have done something besides stick his head in the sand.

 

[Jimmy Higgins]

Going to need to change tact.

Show me the evidence that anybody was instructed to make no check loans. Instructed by Barney Frank or any other Democrat. Evidence.

You are pulling this from your backside.

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

By itself this would have done little harm. We would all have ended up subsidizing loans in poor areas but the effect would be small. However, the market moved to most loans being sold to the government agencies. To make compliance with rule #2 possible these agencies relaxed their rules.

It was this relaxation that caused the catastrophe--rather than bankers forced into such loans there was a new breed exploiting the market. They knew they were writing crap but they didn't care because they were going to promptly resell the loans.

The whole market adapted to labeling crap as prime quality. That was what crashed our economy.

The CRA was the first spark but when things started to get out of hand Bush should have done something besides stick his head in the sand.

Fuck that shit!

Give a demographic showing household income distribution of homes lost in the recession.

Will you do it now?

 

[Togo]

Show me the evidence that anybody was instructed to make no check loans. Instructed by Barney Frank or any other Democrat. Evidence.

You are pulling this from your backside.

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

So all we need is some evidence that regulators descended on people who didn't make enough loans. Fortunately, all regulator actions are published, so why not just pull a few out of the archive and show us what you mean?

I know there's a strong desire to try and link the whole mess to politicians you dislike but...


Securitisation instruments were selling like hotcakes. Billions of dollars were being made by packaging up mortgages into securitisations and selling off the tranches. It filled a gap in the market for medium securities, while feeding the ever-present desires for AA rating investments, and providing the bank creating the securitisation with an immediate a revenue stream. All off-balance sheet, all at above market credit ratings. Banks were literally competing with each other to see how many mortgages they could buy, and pledging vast sums to buy mortgages that hadn't even been signed yet. A mortgage provider could make a profit on a mortgage before the ink was dry, with no oversight from the buyer on either the property or the borrower.

And you think banks were selling mortgages to people who couldn't afford it because of some government initiative? Seriously?

The market crashed because there was no incentive to sell only to people who could afford it. The regulations that would have stopped it had been removed. And when the boom dropped the buyers discovered that they could not tell what it was that they owned, and could not prove it to other people, making vast swathes of their assets unsellable and thus deemed worthless, overnight.

 

[Shadowy Man]

You and all the rest of the Bush-haters are spinning, as usual. Bush and his advisers foresaw what was coming. It was initiated by Democrats who demanded that lenders make loans to "people of color" even and particularly when they were not qualified. That black families did not qualify for loans at the same rate as white and Asian families is of course always taken by Leftists as proof positive of "discrimination." When analyzed objectively, with no eye as to color of borrower, it was always clear that there was no discrimination on the basis of skin color. Families qualified for loans on the basis of credit history and income.

Not good enough, said Barney Frank, and Maxine "That's just 360 degrees wrong" Waters, Chuck Schumer, and Barack Obama. It was because of their lying and meddling that the crash was not avoided. Barney Frank was finally too embarrassed to run for reelection after his latest fiasco.

The Democrat Party has nothing to contribute any longer except more divisiveness and misery. It has moved so far to the left that the downfall of America is almost assured.

You almost had me there... until you insinuated that Barney Frank could be embarrassed by something.

 

[fromderinside]

Not checking information on loan applications was an idea bankers came up with. It was a pathetically easy scheme. Make as many loans as possible, knowing full well many will be bad since you haven't verified anything, then bundle these poisoned loans and sell the bundle to some sucker unaware of the bad loans contained within.

It took no brains. It took no creativity. All it took was incredible and widespread greed and deceit.

And as home prices rose with no rationality Bush fiddled and read some more about goats.

No, he's right about this.

Nobody was asked to make bad loans but they were given conflicting demands: make prudent loans and make enough loans to the community. The latter is far easier to measure, thus when the requirements conflict it's the one that's going to be followed.

Where he goes wrong is in ascribing the collapse to this. It was only the spark, not the inferno. The inferno was caused by those lax standards becoming widespread and a whole bunch of people jumping on the bandwagon, intending to flip properties.

It comes to greed lack of verification and oversight. Failure to check was the worst, most unethical, thing done here. It was done because it was easy since oversight was overwhelmed.

 

[Bronzeage]

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

So all we need is some evidence that regulators descended on people who didn't make enough loans. Fortunately, all regulator actions are published, so why not just pull a few out of the archive and show us what you mean?

I know there's a strong desire to try and link the whole mess to politicians you dislike but...


Securitisation instruments were selling like hotcakes. Billions of dollars were being made by packaging up mortgages into securitisations and selling off the tranches. It filled a gap in the market for medium securities, while feeding the ever-present desires for AA rating investments, and providing the bank creating the securitisation with an immediate a revenue stream. All off-balance sheet, all at above market credit ratings. Banks were literally competing with each other to see how many mortgages they could buy, and pledging vast sums to buy mortgages that hadn't even been signed yet. A mortgage provider could make a profit on a mortgage before the ink was dry, with no oversight from the buyer on either the property or the borrower.

And you think banks were selling mortgages to people who couldn't afford it because of some government initiative? Seriously?

The market crashed because there was no incentive to sell only to people who could afford it. The regulations that would have stopped it had been removed. And when the boom dropped the buyers discovered that they could not tell what it was that they owned, and could not prove it to other people, making vast swathes of their assets unsellable and thus deemed worthless, overnight.

This is a problem from top to bottom.

There are still thousands of foreclosed mortgages in limbo because no one can find the original file which contains the signed mortgage contract. Demanding the creditor produce the original contract in court became a standard tactic to delay a foreclosure and a lot of files had been misplaced, mislabeled, or just plain lost. There are a lot of people living in houses, technically as squatters, because the property isn't worth the expense of working out who legally owns it.

 

[Loren Pechtel]

Going to need to change tact.

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

By itself this would have done little harm. We would all have ended up subsidizing loans in poor areas but the effect would be small. However, the market moved to most loans being sold to the government agencies. To make compliance with rule #2 possible these agencies relaxed their rules.

It was this relaxation that caused the catastrophe--rather than bankers forced into such loans there was a new breed exploiting the market. They knew they were writing crap but they didn't care because they were going to promptly resell the loans.

The whole market adapted to labeling crap as prime quality. That was what crashed our economy.

The CRA was the first spark but when things started to get out of hand Bush should have done something besides stick his head in the sand.

Fuck that shit!

Give a demographic showing household income distribution of homes lost in the recession.

Will you do it now?

Which has nothing to do with what caused the meltdown.

 

[Jimmy Higgins]

Going to need to change tact.Fuck that shit!

Give a demographic showing household income distribution of homes lost in the recession.

Will you do it now?

Which has nothing to do with what caused the meltdown.

Can you do it, just once... just for the giggles of it. I'm begging you, defend just a single position you've posted and reference the stats to defend your claim regarding low income minorities being the driving force for the foreclosures.

 

[Loren Pechtel]

There are still thousands of foreclosed mortgages in limbo because no one can find the original file which contains the signed mortgage contract. Demanding the creditor produce the original contract in court became a standard tactic to delay a foreclosure and a lot of files had been misplaced, mislabeled, or just plain lost. There are a lot of people living in houses, technically as squatters, because the property isn't worth the expense of working out who legally owns it.

But this has nothing to do with whether the people actually defaulted.

I think Congress should have taken a different tactic here: Permit a fast-track foreclosure system. They have to post a bond of say 200% of the market value (or reconstruction value for an old house if it's higher) of the house in lieu of jumping through all the hoops. This shifts the burden of proof, the homeowner now has to show the foreclosure was invalid--but if they do they get the bond as statutory damages. As far as I know there would be only one person in a position to claim that bond.

I would also like to see bonds required by the trash-out companies. That's where the real problem was--cleaning out an incorrect house.

 

[untermensche]

Show me the evidence that anybody was instructed to make no check loans. Instructed by Barney Frank or any other Democrat. Evidence.

You are pulling this from your backside.

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

This is, as usual, nothing but feces pulled from your backside.

Or maybe I'm wrong and you have something besides your totally discredited word.

 

[Loren Pechtel]

Lets try this again and see if you can understand:

1) The banks have a general order to make prudent loans. Note that this lacks a good yardstick of compliance.

2) The banks have specific orders to make enough loans in communities where they have branches--the Community Reinvestment Act. Here there is a very simple yardstick: How many loans are written?

Banks with branches in poor areas found it impossible to comply with both of these rules. Break rule #2 and the regulators descend on them. Break rule #1 and you simply have a few more defaults.

This is, as usual, nothing but feces pulled from your backside.

Or maybe I'm wrong and you have something besides your totally discredited word.

Just because you don't like that a leftist policy could have been the trigger doesn't make it not so.

 

[untermensche]

This is, as usual, nothing but feces pulled from your backside.

Or maybe I'm wrong and you have something besides your totally discredited word.

Just because you don't like that a leftist policy could have been the trigger doesn't make it not so.

First of all, why is it a leftist policy to reach out to minorities?

It seems just a human policy.

And you have nothing but hot air, no real connection between not checking information, on mostly applications made by white applicants, and any Democrat.

This is pure nonsense to deflect from one of the greatest crimes, by bankers, as the Bush administration looked away, in human history.

Why are you a shill for these criminals? What do you get for it?

 

[arkirk]

Just because you don't like that a leftist policy could have been the trigger doesn't make it not so.

First of all, why is it a leftist policy to reach out to minorities?

It seems just a human policy.

And you have nothing but hot air, no real connection between not checking information, on mostly applications made by white applicants, and any Democrat.

This is pure nonsense to deflect from one of the greatest crimes, by bankers, as the Bush administration looked away, in human history.

Why are you a shill for these criminals? What do you get for it?

You are talking to a man who has cotton in his ears. Well maybe not...but certainly one who lives in a gated community and can afford to post here full time.

 

[Loren Pechtel]

Just because you don't like that a leftist policy could have been the trigger doesn't make it not so.

First of all, why is it a leftist policy to reach out to minorities?

It seems just a human policy.

And you have nothing but hot air, no real connection between not checking information, on mostly applications made by white applicants, and any Democrat.

It was a policy of writing loans to underqualified buyers. The banks don't desire to discriminate, that costs them business. Even if some banks discriminate there would be others. Thus it's a discriminate-in-favor-of-minorities law just like AA is.

This is pure nonsense to deflect from one of the greatest crimes, by bankers, as the Bush administration looked away, in human history.

Why are you a shill for these criminals? What do you get for it?

I'm not saying the bankers weren't wrong. I'm saying the spark was provided by the CRA. The mortgage-writers ran with it, though, and turned it into a bonfire.

 

[Jimmy Higgins]

This is, as usual, nothing but feces pulled from your backside.

Or maybe I'm wrong and you have something besides your totally discredited word.

Just because you don't like that a leftist policy could have been the trigger doesn't make it not so.

Firstly, W suggests it was his idea. Secondly, you haven't supported your claim with jackshit. Or ape shit. Or even bullshit.

 

[untermensche]

First of all, why is it a leftist policy to reach out to minorities?

It seems just a human policy.

And you have nothing but hot air, no real connection between not checking information, on mostly applications made by white applicants, and any Democrat.

It was a policy of writing loans to underqualified buyers.

That was a policy completely invented by the banks and the majority of bad loans were made to white people, not racial minorities.

 

[Loren Pechtel]

It was a policy of writing loans to underqualified buyers.

That was a policy completely invented by the banks and the majority of bad loans were made to white people, not racial minorities.

Are you even reading what I'm writing? Or are you so obsessed with blaming the banks you don't care about the details?


I never said anything about the race of the average recipient of a bad loan.

I said the CRA started it but that after that the bankers ran with it. That says absolutely nothing about the race of the recipients of the liar loans. I don't know what the distribution is and I don't think it matters.

 

[untermensche]

That was a policy completely invented by the banks and the majority of bad loans were made to white people, not racial minorities.

Are you even reading what I'm writing? Or are you so obsessed with blaming the banks you don't care about the details?


I never said anything about the race of the average recipient of a bad loan.

I said the CRA started it but that after that the bankers ran with it. That says absolutely nothing about the race of the recipients of the liar loans. I don't know what the distribution is and I don't think it matters.

That is an absurd right-wing talking point that has no connection to anything real.

What you fail to understand is this criminal scheme was two-fold.

First it was the abandonment of reasonable banking practices.

THEN it was disguising the bad loans by bundling them and passing them on to some unsuspecting sucker. That was the crime that made the whole thing possible.

Giving bad loans was only a piece of the picture.

Do you want to also claim the banks were forced to lie about known bad investments because of the CRA?

 

[Loren Pechtel]

Are you even reading what I'm writing? Or are you so obsessed with blaming the banks you don't care about the details?


I never said anything about the race of the average recipient of a bad loan.

I said the CRA started it but that after that the bankers ran with it. That says absolutely nothing about the race of the recipients of the liar loans. I don't know what the distribution is and I don't think it matters.

That is an absurd right-wing talking point that has no connection to anything real.

What you fail to understand is this criminal scheme was two-fold.

First it was the abandonment of reasonable banking practices.

THEN it was disguising the bad loans by bundling them and passing them on to some unsuspecting sucker. That was the crime that made the whole thing possible.

Giving bad loans was only a piece of the picture.

Do you want to also claim the banks were forced to lie about known bad investments because of the CRA?

You're not rebutting me at all. You're just so obsessed with the bankers that you won't look at the big picture.