Rob's House Posted April 10, 2012 Share Posted April 10, 2012 This was happening because they weren't regulated. You need to learn the difference between not regulated and misregulated. Because I have a job, and a family to take care of and I don't have all day to be on here they way you guys do. Posting at work is the only way to post. I'm "working" right now. I thought your generation was supposed to all about "multi-tasking." So predatory lending is a myth? Regulation was tight? You're drinking what they're selling. Link to comment Share on other sites More sharing options...
DC Tom Posted April 10, 2012 Share Posted April 10, 2012 So predatory lending is a myth? Regulation was tight? This is why I don't debate most people, and just call them idiots. I said "not accurate," and you immediately jump to "completely false." Nice. Idiot. Link to comment Share on other sites More sharing options...
fjl2nd Posted April 10, 2012 Share Posted April 10, 2012 This is why I don't debate most people, and just call them idiots. I said "not accurate," and you immediately jump to "completely false." Nice. Idiot. How about you just tell what isn't accurate about the statement then? Geez... Link to comment Share on other sites More sharing options...
DC Tom Posted April 10, 2012 Share Posted April 10, 2012 How about you just tell what isn't accurate about the statement then? Geez... I've done it before. I have no particular desire to repeat myself. Search the board. Link to comment Share on other sites More sharing options...
UConn James Posted April 10, 2012 Share Posted April 10, 2012 Actually, by the employment statistics, the economy's created a net million jobs since January 2009. Also by the employment stats, those people who've fallen off the unemployment roll and those who've decided to stop looking for work because it's a waste of time... well, the administration and the media who want another term for their golden child like to pretend that those people dropped off the map. Link to comment Share on other sites More sharing options...
WorldTraveller Posted April 10, 2012 Share Posted April 10, 2012 Actually there was a lot of predatory lending going on. Federal aesignment laws were getting violated like it was going out of style. Without a doubt lenders were placing people into homes they knew they couldn't afford. Do you even know what the robo signings was all about? Talk about fraud. Geez, most banks didn't even own the original loan documents. They cut corners because of MERS, Mortgage ElectronicRegistry Systems. Lenders knowing they didn't have the Original Loan Documents, couldn't legally collect or foreclose because they didn't have these documents would hire people to forge these documents, just so they could foreclose on homeowners. Guys ever hear of"Linda green"? Google it. I could go on and on with all the violations the banks had committed, but let me just say this, everyone was guilty. I'm not trying to fully absolve all the wreck less and irresponsible homeowners, because without a doubt they were a part of the problem as well. But let's not pretend that there wasn't rampant predatory lending and fraudulent practices out there. Link to comment Share on other sites More sharing options...
GG Posted April 10, 2012 Share Posted April 10, 2012 SEC. They relaxed standards, specifically on the Net Capital Rule allowing investment banks to increase their financial leverage and issued many more mortgage backed securities. Risk continued to skyrocket along with debt loads. I can throw out acronyms with the best of them. SEC's Net Capital Rule was not the main cause, nor was it the monster that regulation-heavy pundits cry about. But it certainly helped that SEC was over its head in trying to keep up with financial innovation - both good & bad. You can apply that to anyone directly involved with the mess, except for the guys who were shorting the housing market. Link to comment Share on other sites More sharing options...
3rdnlng Posted April 10, 2012 Author Share Posted April 10, 2012 Actually there was a lot of predatory lending going on. Federal aesignment laws were getting violated like it was going out of style. Without a doubt lenders were placing people into homes they knew they couldn't afford. Do you even know what the robo signings was all about? Talk about fraud. Geez, most banks didn't even own the original loan documents. They cut corners because of MERS, Mortgage ElectronicRegistry Systems. Lenders knowing they didn't have the Original Loan Documents, couldn't legally collect or foreclose because they didn't have these documents would hire people to forge these documents, just so they could foreclose on homeowners. Guys ever hear of"Linda green"? Google it. I could go on and on with all the violations the banks had committed, but let me just say this, everyone was guilty. I'm not trying to fully absolve all the wreck less and irresponsible homeowners, because without a doubt they were a part of the problem as well. But let's not pretend that there wasn't rampant predatory lending and fraudulent practices out there. Let's bring this down to the simplest terms. If Fannie & Freddie were strictly regulated as a GSE would the banking levels beneath them have been so cavalier? If there was no CRA and CRAII, would so many toxic loans ever gotten into the system to end up in F&F's laps? Now, if F&F would have been regulated during the Bush Administration would this have cut the toxic loans off at the pass and kept the problem managable? Link to comment Share on other sites More sharing options...
B-Large Posted April 10, 2012 Share Posted April 10, 2012 Perhaps securitizing highly leveraged mortgage notes in masse wasn't a good idea after all.... If banks were required to hold the Note they originated, my guess is they don't fund 400k mortgages on people with stated income and little down payment... Perhaps the government should not be in the loan guarantee business, that way taxpayers don't have to fund mortgage programs or bailouts when all the financiers coming looking for the bailout money... Why would George Bush make a stink while this happened, the economy was great.... By the time Grenspan was talking Froth, the damage had been done.... What a mess Link to comment Share on other sites More sharing options...
meazza Posted April 10, 2012 Share Posted April 10, 2012 Perhaps securitizing highly leveraged mortgage notes in masse wasn't a good idea after all.... If banks were required to hold the Note they originated, my guess is they don't fund 400k mortgages on people with stated income and little down payment... Perhaps the government should not be in the loan guarantee business, that way taxpayers don't have to fund mortgage programs or bailouts when all the financiers coming looking for the bailout money... Why would George Bush make a stink while this happened, the economy was great.... By the time Grenspan was talking Froth, the damage had been done.... What a mess Every desk has their risks and hindsight is always 20/20 but one of the issues is that risk managers aren't always given an ear since if they really knew more than the traders, they'd be working on the desk. Link to comment Share on other sites More sharing options...
Wacka Posted April 10, 2012 Share Posted April 10, 2012 That is a crap article. It mentions 1977 and jumps to the Bush era and says that he weakened it. Bush didn't weaken it but Clinton expanded it (I think 1998). Anyway Bush and McCain were very vocal about reigning in Fannie & Freddie. Barney Frank, Chris Dodd and many others were guilty of economic treason in defending Fannie & Freddie. Do you want to see the video of them ripping apart a federal regulator for warning them about the two F's? Do you know anything about Franklin Raines? Again that article is crap. Was Franklin Raines Barney's boyfriend? I actually don't recognize his name. Barney's squeeze was one of the muckety-mucks at one of the Fs. Link to comment Share on other sites More sharing options...
3rdnlng Posted April 10, 2012 Author Share Posted April 10, 2012 (edited) Was Franklin Raines Barney's boyfriend? I actually don't recognize his name. Barney's squeeze was one of the muckety-mucks at one of the Fs. Franklin Raines headed up Fannie for I think 5 years at a salary and bonus of 90 some million. He also served in the Clinton administration. Somehow the criteria for maximum bonus was always met. He had to give 25 million back (most of it funny money) after some sort of threatened indictment for cooking the books. As far as being Barney's boyfriend, the head of Fannie surprisingly wasn't. He (Raines) was the one that made the taxpayers bend over. Barney had someone lower down the totem pole at Fannie helping him with his gay brothel and whatever else. http://seattletimes.nwsource.com/html/businesstechnology/2004358433_webraines18.html Edited April 10, 2012 by 3rdnlng Link to comment Share on other sites More sharing options...
WorldTraveller Posted April 10, 2012 Share Posted April 10, 2012 Let's bring this down to the simplest terms. If Fannie & Freddie were strictly regulated as a GSE would the banking levels beneath them have been so cavalier? If there was no CRA and CRAII, would so many toxic loans ever gotten into the system to end up in F&F's laps? Now, if F&F would have been regulated during the Bush Administration would this have cut the toxic loans off at the pass and kept the problem managable? I believe your point would be more effective if it wasn't so one-sided. Did CRA play a role? Sure, but not nearly as much as you believe. Should F/F of had more oversight in its bundling of loans and packaging them as MBS? Yep. But why no mention of the mortgage companies unscrupulous activities? Or banks predatory lending practices? Or blatant fraudulent activity? Or devastating lax underwriting? What about the Feds role with interest rate policy? What about the ratings agency? After all they gave investors the warm and fuzzies, providing a false sense of security. What about repealing glass- steagall? What about the consumers? Nd nowhere did I see you mention wall street. I mean you do understand that wall streets role in creating highly leveraged exotic investment vehicles that in many cases weren't even directly attached to a tangible product for the sole purpose of enabling and encouraging investors to engage in casino like gambling is what did more damage than anything right? Wall street wasn't the root problem, but it was certainly the most devastating issue. It is what caused the largest monetary impact out of this whole debacle. I'm guessing that you probably gripe about tax payer money being wasted, right? Well where is the outrage caused by wall street? Did they pack most of TARP? Sure, but that's not the main monetary impact caused by wall street, it's the collateral damage that matters most. Most people, incorrectly believe that the reason that our national deficit has swelled over the past few years is because Obama has layered new spending policies. Sorry to tell you folks, thats simply and factually untrue. The reason why the deficit has swelled is because of loss of tax receipts. The devastation caused by the housing crisis is the main deficit driver. And a if you want a point a finger, you have to point it everywhere, not just the GSEs and CRA. It just sounds overtly partisan when you do Link to comment Share on other sites More sharing options...
3rdnlng Posted April 10, 2012 Author Share Posted April 10, 2012 I believe your point would be more effective if it wasn't so one-sided. Did CRA play a role? Sure, but not nearly as much as you believe. Should F/F of had more oversight in its bundling of loans and packaging them as MBS? Yep. But why no mention of the mortgage companies unscrupulous activities? Or banks predatory lending practices? Or blatant fraudulent activity? Or devastating lax underwriting? What about the Feds role with interest rate policy? What about the ratings agency? After all they gave investors the warm and fuzzies, providing a false sense of security. What about repealing glass- steagall? What about the consumers? Nd nowhere did I see you mention wall street. I mean you do understand that wall streets role in creating highly leveraged exotic investment vehicles that in many cases weren't even directly attached to a tangible product for the sole purpose of enabling and encouraging investors to engage in casino like gambling is what did more damage than anything right? Wall street wasn't the root problem, but it was certainly the most devastating issue. It is what caused the largest monetary impact out of this whole debacle. I'm guessing that you probably gripe about tax payer money being wasted, right? Well where is the outrage caused by wall street? Did they pack most of TARP? Sure, but that's not the main monetary impact caused by wall street, it's the collateral damage that matters most. Most people, incorrectly believe that the reason that our national deficit has swelled over the past few years is because Obama has layered new spending policies. Sorry to tell you folks, thats simply and factually untrue. The reason why the deficit has swelled is because of loss of tax receipts. The devastation caused by the housing crisis is the main deficit driver. And a if you want a point a finger, you have to point it everywhere, not just the GSEs and CRA. It just sounds overtly partisan when you do Again, simply put would this crisis have happened if there was no CRA, CRAII and if Fannie and Freddie had been reigned in soon enough? I don't disagree with your points, I was addressing the root causes. Link to comment Share on other sites More sharing options...
WorldTraveller Posted April 10, 2012 Share Posted April 10, 2012 Again, simply put would this crisis have happened if there was no CRA, CRAII and if Fannie and Freddie had been reigned in soon enough? I don't disagree with your points, I was addressing the root causes. You're missing the point . Where is the same level of outrage over the other matters which I believe were the larger drivers? Link to comment Share on other sites More sharing options...
GG Posted April 10, 2012 Share Posted April 10, 2012 You're missing the point . Where is the same level of outrage over the other matters which I believe were the larger drivers? Agreed on CRA, that excuse is crap. But not so Fan/Fred. A lot of the housing data that everyone was using came from them, which in retrospect was tainted by the GSEs desire to keep the housing wheels turning. This was the biggest contributor to the circular logic/risk mismanagement that came out of the housing collapse. When the biggest holder of mortgages and gatherer of most data was sending faulty signals to the market about its portfolio it deluded otherwise sane people that you could still ride out the risk curve. And yes, the Franklin Raines example was damning because it reinforced the view that the government would not do anything to the GSE, despite clear evidence of accounting fraud that paled anything that came out of the Enron era. Link to comment Share on other sites More sharing options...
DC Tom Posted April 10, 2012 Share Posted April 10, 2012 Perhaps securitizing highly leveraged mortgage notes in masse wasn't a good idea after all.... If banks were required to hold the Note they originated, my guess is they don't fund 400k mortgages on people with stated income and little down payment... That right there is the biggest reason. The belief banks had that they could amortize risk by grouping really ****ty IO neg-am mortgages together and selling them to someone else, and the consumer's stupidity in thinking a neg-am IO mortgage was in any sense a good idea ("By the time this $100k balloon payment is due, I'll be making twice my current $30k salary!" No, considering that you're already demonstrating you can't manage your money, no you won't.) Link to comment Share on other sites More sharing options...
Rob's House Posted April 10, 2012 Share Posted April 10, 2012 You're missing the point . Where is the same level of outrage over the other matters which I believe were the larger drivers? A lot of the blame is of little value to analyze. Bankers and "Wall Street" are not monolithic and weren't comprised of people with different moral character in the 2000s than at any other time. The problem was structural. Without Government policies and entities (FDIC, GSEs, CRA, ETC.)none of this would have even been possible. You can argue that some of these other factors might have made a difference, but there's no certainty. Anyone denying this or trying to say "Yeah, but..." might as well be defending Trent Edwards and blaming everyone around him trying ignore the fact that if he didn't suck we wouldn't be having the conversation. The liberal take on this is no different from their approach to the Trayvon Martin incident in that they treat their preconceptions as factual. They take their paradigm (business, banks, corporations, and rich people are evil, fleece the poor, and run the world), solidify their stereotypes as hard laws of science, then apply it to another paradigm (government is good and does the will of the people to make things better) and based on two faulty premises come to the logical conclusion that: If only the pure and righteous government regulators had their fingers a little deeper in this pie everything would have been perfect. Link to comment Share on other sites More sharing options...
B-Large Posted April 10, 2012 Share Posted April 10, 2012 That right there is the biggest reason. The belief banks had that they could amortize risk by grouping really ****ty IO neg-am mortgages together and selling them to someone else, and the consumer's stupidity in thinking a neg-am IO mortgage was in any sense a good idea ("By the time this $100k balloon payment is due, I'll be making twice my current $30k salary!" No, considering that you're already demonstrating you can't manage your money, no you won't.) I remember people saying it, or the house would double in value by then and they could sell it an buy two..... It just couldn't end, this gravy train... well, until it did. Link to comment Share on other sites More sharing options...
Jauronimo Posted April 10, 2012 Share Posted April 10, 2012 Perhaps securitizing highly leveraged mortgage notes in masse wasn't a good idea after all.... If banks were required to hold the Note they originated, my guess is they don't fund 400k mortgages on people with stated income and little down payment... Perhaps the government should not be in the loan guarantee business, that way taxpayers don't have to fund mortgage programs or bailouts when all the financiers coming looking for the bailout money... Why would George Bush make a stink while this happened, the economy was great.... By the time Grenspan was talking Froth, the damage had been done.... What a mess There's nothing wrong with securitizing garbage mortgages, just as long as you aren't selling tranches in your worthless synthetic CDO as a AAA-rated asset and then buying CDSs to effectively short the "risk-free" security you just sold. Bang up job by our ratings agencies, who as it turns out, never once saw any of the underlying mortgages. Seems like that might be a pertinent step in assessing the risk of an asset backed security. I would be willing to bet that if Goldman delivered to Fitch 100 lbs of dog **** diversified with 100lbs of **** from another dog, it would at least get a BBB. Link to comment Share on other sites More sharing options...
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