You're mine now !!!

[mookiemookie]

Originally Posted by SteamWake

It was 'recommended'

http://iperceive.net/hidden-clinton-...or-minorities/

I still fail to see how any of those political goals translated into mortgage brokers and banks lowering their lending standards. That was a purely profit motivated decision, not a government mandate.

Furthermore, a study by the Cleveland Fed found that 60% of "higher priced loan originations" went to middle or higher income borrowers or neighborhoods. This story of the financial crisis being caused by big bad Clinton pushing banks to make loans to minorities falls apart when you examine the facts.

Fannie and Freddie didn't do most of their subprime buying until 2005 - 2007. By that time the wheels of the crisis were already in motion. Peak home sales were in August 05 and peak prices in 2006. While they're not innocent by any stretch, to suggest that the entire crisis can be traced back to Fannie and Freddie is disingenuous.

[SteamWake]

Originally Posted by mookiemookie

I still fail to see how any of those political goals translated into mortgage brokers and banks lowering their lending standards. That was a purely profit motivated decision, not a government mandate.

When your mother tells you to clean your plate you had better do it.

Carter, Clinton, & Bush No 1 all strongarmed the banks to make the loans that they were full and well aware would not be repaid.

[mookiemookie]

Originally Posted by SteamWake

When your mother tells you to clean your plate you had better do it.

Carter, Clinton, & Bush No 1 all strongarmed the banks to make the loans that they were full and well aware would not be repaid.

Profit motive, the reach for yield in the face of ultra low rates, the need to gain market share and the "lend to securitize" model of lending where banks could "pass the buck" and not have to hold garbage loans on their balance sheet is what did it. Not the whims of a president or presidents.

And Carter? Carter?! That was 30+ years ago. And you're telling me something he did (I have no idea what unless you're gonna go with the old debunked CRA argument) caused the 2007 financial crisis. That argument fails not just logically, but in terms of time and space.

[SteamWake]

Carter is the one whom started the whole 'affordible housing' thing. While well intentioned no one at the time realized what a debacle it would become.

Here is an excellent op ed on the topic.

http://apnews.myway.com/article/20090407/D97DIVI01.html

[mookiemookie]

I think you may want to check that link.

[SteamWake]

Besides banks, there was reduced regulatory oversight, loans to unqualified borrowers were encouraged and people took out mortgages or home-equity loans they couldn't afford.

/shrug