You have been elected to the Senate of the United States of America. Your party has asked you to write a bill. To write a bill to keep the Banks, Wall Street stock market under control.
What would you do about the following things? If anything.
The Stockmarket. Bail them out again?
The Banks, like Stanley Morgan, to big to fail.
The banks, the loans they make, the fees they charge and the interest they can charge. Do you think 20% to 45% is to much.
Should there be a cap on the amount, credit companies can charge in interest.
Yes, banks should be allowed to fail. Yes, there should be a cap on interest, both bank and credit card. And the one thing you left out is, no, the government should not be allowed to force them to make risky loans.
The stock market should be left alone to take care of itself.
I think this is an interesting statement by Thomas Jefferson about this:
{I consider the foundation of the Constitution as laid on this ground: That "all powers not delegated to the United States, by the Constitution, nor prohibited by it to the States, are reserved to the States or to the people."
To take a single step beyond the boundaries thus specially drawn around the powers of Congress, is to take possession of a boundless field of power, no longer susceptible of any definition.
The incorporation of a bank, and the powers assumed by this bill, have not, in my opinion, been delegated to the United States, by the Constitution... They are not among the powers specially enumerated...}
Quote from: me on April 26, 2010, 12:47:59 AMYes, banks should be allowed to fail. Yes, there should be a cap on interest, both bank and credit card. And the one thing you left out is, no, the government should not be allowed to force them to make risky loans. The stock market should be left alone to take care of itself.
First I think a new and improved, Glass Steagall Act, it work of over 30 years, with criminal penalties and jail time, in hard time prisons, not country club prisons, and forfeitures of all property and money they have made in these ventures.
Banks like Stanley Morgan (banks to big to fail) should be broken up. Just like Bell Telephone and Standard Oil and other other monoplies. The banks as a whole should have a fund to take care of bankruptcy of the banks.
Rules should be made to stop the theft and inside trading and the phony packaging of the derivatives they have dreamed up and a closer look at short selling. With an some really bad punishment for their crimes. Hard time and the forfeitures of all stolen money. In other words take everything they have.
I think there should be a cap on all interest of 20%. Credit cards and anything sold on credit. I think that all Payday loans and Car title loans can not collect anymore than 25% of a loan, be for interest and fees. Some of the poor people have got stuck in these loan for over 50% of the loan.
I think with some good laws with real teeth to put the bad boy away for a long, long time would really help.
The Troll
I do not think the government has the fortay in telling the lenders how to evaluate risk in lending....they are NOT very good in that department..over the last 20 years they have pushed the mortgage industry so hard to get minority homeownership up and into giving "risky" loans, that it damaged the country's financial institution to accomplish its goal....that was extremely POOR advice and that is why we are in the shape we are now...We already have a department of justice who are supposed to enact the laws that we already have in place to nail who those commit fraudulent acts....it is of my opinion, that we need LESS Gov involvement and let the Private Industry handle the loan industry....I realize there has to be SOME oversight, but let the free market dictate what "caps" should be permitted on loans.....and IF they fail, they fail....this is the only way this system can "clean" itself out....it seems the MORE we regulate things, the more it costs us....always screws the little guys...
You want to talk about screwing the little guy? Let these banks fail and the "little guy" will get rode hard and put away wet! :yes:
Quote from: Palehorse on April 26, 2010, 04:27:09 PM
You want to talk about screwing the little guy? Let these banks fail and the "little guy" will get rode hard and put away wet! :yes:
I agree as it is now, we have ALL trusted our lives to Wall Street......maybe that needs to change and we all need to not rely on Wall Street....there are safer ways to invest, that Banks have in place....but keeping the Gov from FORCING banks into making bad investments and letting those guys who KNOW how to invest...invest....and by the laws of nature, those who know what they are doing will be successful...not by screwing folks but by helping folks.
I will ALWAYS chose private over gov control ANY day...
Nah.
Let's just abolish all government and governmental services, arm ourselves to the teeth, and let private enterprise (in the form of its most private: every person for him/herself) take over.
After a bloodbath of incredible size, we will reduce ourselves to the size of a grape, and will be ripe for a takeover.
Then we can start all over again.
Yay, private enterprise with NO D*MN GUB'MINT KENTROL A-TALL.
Quote from: followsthewolf on April 26, 2010, 04:54:06 PM
Nah.
Let's just abolish all government and governmental services, arm ourselves to the teeth, and let private enterprise (in the form of its most private: every person for him/herself) take over.
After a bloodbath of incredible size, we will reduce ourselves to the size of a grape, and will be ripe for a takeover.
Then we can start all over again.
Yay, private enterprise with NO D*MN GUB'MINT KENTROL A-TALL.
actually, I didn't mean ALL gov control...I realize we have to have a certain amount, but if we don't soon get a grip on HOW much trust we have on those crooks in washington, we are going to end up with a government MUCH like the one we escaped from a couple of hundred years ago...my point is, I trust Americans MORE than the guys in Washington .... and not just the dems...ALL of them....they are spending more money than we have got....we got to put our money back into the entreprenours and let them invest into America....NOT let politicians spend OUR money.
Got news fer yah Hank; those "banking investments" that have failed and are failing are all privately controlled by the entities doing the investments. This "bloodbath" we're going through is driven by the thieves at the controls and making those stupid decisions in the first place. The government didn't force them to make 250k loans to people making 20k a year, they chose to do so on their own and this is the result.
And, if those banks fail wave good bye to your investments with them too. Back out FDIC insurance and your savings and checking accounts are gone no matter how much you had in them. FDIC was created to encourage people to stop stuffing their mattresses and open up accounts.
The government backed program (FHA) has always had strict guidelines for loans. Fannie May, Freddie Mac, while government backed also had guidelines they were supposed to adhere to but obviously chose not to. Again, not the gubment but the private individual's choices in the lion's share of the cases.
Then add to it the closing companies and resulting job losses, and its just icing on the cake of excrement these private jack asses have whipped up for us all to take a huge bite of. . .
The governments efforts are an attempt to stop the domino thing from happening, seeing how most banks maintain lines of credit and investments within other banks. Once one fails there will be a series of them that will be severely and negatively impacted because of it. And that good old local bank you've trusted for twenty + years with your business would be one of them without a doubt.
All you had to do for some of the programs in the Fannie or Freddie loan program was to be breathing.
Quote from: Henry Hawk on April 26, 2010, 05:06:37 PM
actually, I didn't mean ALL gov control...I realize we have to have a certain amount, but if we don't soon get a grip on HOW much trust we have on those crooks in washington, we are going to end up with a government MUCH like the one we escaped from a couple of hundred years ago...my point is, I trust Americans MORE than the guys in Washington .... and not just the dems...ALL of them....they are spending more money than we have got....we got to put our money back into the entreprenours and let them invest into America....NOT let politicians spend OUR money.
The sticking point is how much. Some say to-may-to, some say to-mah-to.
George Washington was the first to start a rebellion, by taxing whiskey at the rate of 1/2 penny. Blame him.
Quote from: me on April 26, 2010, 06:06:46 PM
All you had to do for some of the programs in the Fannie or Freddie loan program was to be breathing.
Horse manure. The guidelines were the same for these two as they were for banks. The administrators are to blame for overlooking the rules of qualification, and for creating methods of circumventing them.
Quote from: me on April 26, 2010, 06:06:46 PM
All you had to do for some of the programs in the Fannie or Freddie loan program was to be breathing.
hardly u don't know what u r saying. I was in an FMHA/USDA home and tried to refinance with Fannie Mae, no go.
i had just gone through 2 bad years of surgery and not being able to work.
When I went to college in 96-97 i did get a student loan.
Quote from: Palehorse on April 26, 2010, 11:16:39 PM
Horse manure. The guidelines were the same for these two as they were for banks. The administrators are to blame for overlooking the rules of qualification, and for creating methods of circumventing them.
I know first hand what the rules and regulations were and they had loan programs where you just stated your income and they took your word for it, it was called a no doc at first and then went to stated income and not only did investors get properties that way but home owners bought with those types too. You could also walk away with cash in your pocket at the closing when buying by over appraising the property which helped inflate the cost of housing. That type of loan was started so those who couldn't qualify through normal conventional loans could get a house. Then they also had the loans where your payment was kept low for 5 to 7yrs and then went up because your income would supposedly be higher by then and you could afford the higher payments but guess what, when the 5 to 7yrs was up some found they still couldn't afford the higher payments. There was also the tax abatement's which did the same thing. Those were all started in the mid 90's and guess when they started falling apart. They, those types of loans, were part of the Fannie Freddy program.
Quote from: Moonglow on April 27, 2010, 12:34:00 AM
hardly u don't know what u r saying. I was in an FMHA/USDA home and tried to refinance with Fannie Mae, no go.
i had just gone through 2 bad years of surgery and not being able to work.
When I went to college in 96-97 i did get a student loan.
But did you try a mortgage broker who had access to the different types of non conventional loans? If you went the conventional way that, of course, got you no where.
Quote from: Henry Hawk on April 26, 2010, 04:24:23 PMI do not think the government has the fortay in telling the lenders how to evaluate risk in lending....they are NOT very good in that department..over the last 20 years they have pushed the mortgage industry so hard to get minority homeownership up and into giving "risky" loans, that it damaged the country's financial institution to accomplish its goal....that was extremely POOR advice and that is why we are in the shape we are now...We already have a department of justice who are supposed to enact the laws that we already have in place to nail who those commit fraudulent acts....it is of my opinion, that we need LESS Gov involvement and let the Private Industry handle the loan industry....I realize there has to be SOME oversight, but let the free market dictate what "caps" should be permitted on loans.....and IF they fail, they fail....this is the only way this system can "clean" itself out....it seems the MORE we regulate things, the more it costs us....always screws the little guys...
Henry, where in hell did you get or see any law or any ruling that the government made the bank loan money to a person who made $40,000 a year to buy a $400,000 house. Or a person who doesn't have a job to buy a house. Show me anything that forces the banks to make bad loans. Just any thing, not something you dreamed up. :flap: :flap:
Henry, do you honestly believe that the Robber Barons are going to create a free market in the banking and the stockmarket. That's just like saying, "That God didn't make little green apples and it don't rain in Indianapolis in the summer time."
There only one power in this country that has the power to bring the criminal predatory capitalist under control is, THE UNITED STATES OF AMERICA GOVERNMENT. God and the common working people sure doesn't have that power. :trustme:
Henry, it was your Republican party and the laws that Phil Gramm and his senator buddies slipped in the budget bill that let the predatory sonuvabitch loose.
The Troll :flag: :flag: :flag:
Quote from: me on April 27, 2010, 01:34:25 AM
I know first hand what the rules and regulations were and they had loan programs where you just stated your income and they took your word for it, it was called a no doc at first and then went to stated income and not only did investors get properties that way but home owners bought with those types too. You could also walk away with cash in your pocket at the closing when buying by over appraising the property which helped inflate the cost of housing. That type of loan was started so those who couldn't qualify through normal conventional loans could get a house. Then they also had the loans where your payment was kept low for 5 to 7yrs and then went up because your income would supposedly be higher by then and you could afford the higher payments but guess what, when the 5 to 7yrs was up some found they still couldn't afford the higher payments. There was also the tax abatement's which did the same thing. Those were all started in the mid 90's and guess when they started falling apart. They, those types of loans, were part of the Fannie Freddy program.
Again, the government had no part in these types of programs and skullduggery. It was the administration and leadership that initiated these types of programs and took advantage of loopholes in the laws. And if you are going to say, "Well the government should have put a stop to it"; well, wouldn't that be a higher level of government involvement and something your side is so against?
the banks etc, enjoy forclosure, the govt. supports their shortfalls in investment and they get to keep the property and all the dough.
Quote from: The Troll on April 27, 2010, 09:30:40 AM
Show me anything that forces the banks to make bad loans. Just any thing, not something you dreamed up. :flap: :flap:
I will play your game....try to look up the Community Reinvestment Act ....
What Is It?
The Community Reinvestment Act (CRA) was established by Congress in 1977. The Act requires that deposit-taking financial institutions offer equal access to lending, investment and services to all those in an institution's geographic assessment area-at least three to five miles from each branch. In the case of large banks with many branches, the geographic area may encompass an entire county or even a state.
Before the CRA, many bankers excluded low-income neighborhoods and people of color from their lending products, investments, and financial services - a practice known as "redlining". Community activists coined the term when they discovered that the failure of banks to make loans in some low-income neighborhoods was so geographically distinct, that it was easy to draw red lines on maps to delineate the practices.
In the 1970s, activists in Chicago and across the country brought strong pressure on banks to lend equitably to all those in their communities. Since its passage, the CRA has been used across the United States to win tens of billions of dollars in new lending, investments, and services for communities. The National Community Reinvestment Coalition tracks more than $1 trillion dollars in community reinvestment pledges nationally. These pledges are explicit investments in equitable development goals, and finance many tools in this toolkit.
http://www.policylink.org/site/c.lkIXLbMNJrE/b.5136941/k.29F6/Why_Use_it.htm
CRA lending has been profitable for financial institutions. The ten-year California commitments made by Bank of America, Wells Fargo Bank and First Interstate Bank in 1992 were completed within four to five years. In half the time expected, a total of $21 billion had been invested in low-income communities and communities of color. This was a lesson for all the major banks: expanding products and marketing to previously ignored communities and people increased profits. These California commitments were the largest and most comprehensive in the country and helped set the terms of engagement nationally.
addition, studies by diverse groups such as Bank of America and the Woodstock Institute, a community research institute based in Chicago , have shown that mortgage loans to low-income single families are less risky than those to wealthy borrowers.
Reviewing this information reveals inequities:
•African American households received a proportion of home loans representing less than half their portion of the city population. They were denied loans more than twice as often as whites.
•Latinos and Asian Americans got loans proportionally less than their share of the population and were denied more often than whites.
•Applications taken from all people of color were significantly below their representation in Oakland. This means that the results of outreach efforts to potential homeowners of color were not proportionately adequate.
•African Americans were denied 2.3 times as often and Asian Americans, and Latinos were denied 1.3 times as often as white applicants. This indicates that the bank underwriting process may unfairly judge applicants of color.
These inequities need to be addressed in negotiations. Fairness requires new products that better meet the needs of people of color, true diversity among loan officers, and focused marketing to reach the previously underserved. These needs can also form the basis of letters to bank regulators
As part of its responsibility for supervising and regulating the CRA activities of national banks, the Office of the Comptroller of the Currency, from time to time, issues letters interpreting the Community Reinvestment Act. Those letters are published in the monthly compilation Interpretations and Actions, and are available to read and/or download by selecting from the list below. Each letter is available in HTML by clicking on the letter number, in WordPerfect 6.1 for Windows format by clicking on the WP following the description, or in Microsoft Word 97 format by clicking on the WORD following the description.
http://www.occ.treas.gov/cra/craintrp.htm
Letter states that financial institutions may receive favorable CRA credit for investing in a middle income housing down-payment assistance program if the investment is a "qualified investment" under the CRA regulation.
Community Reinvestment Act
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The Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII of the Housing and Community Development Act of 1977, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.) is a United States federal law designed to encourage commercial banks and savings associations to meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods.[1][2][3] Congress passed the Act in 1977 to reduce discriminatory credit practices against low-income neighborhoods, a practice known as redlining.[4][5]
The Act requires the appropriate federal financial supervisory agencies to encourage regulated financial institutions to meet the credit needs of the local communities in which they are chartered, consistent with safe and sound operation (Section 802.). To enforce the statute, federal regulatory agencies examine banking institutions for CRA compliance, and take this information into consideration when approving applications for new bank branches or for mergers or acquisitions (Section 804.).[6]http://en.wikipedia.org/wiki/Community_Reinvestment_Act
Some economists, politicians and other commentators have charged that the CRA contributed in part to the 2008 financial crisis by encouraging banks to make unsafe loans. Economists from the Federal Reserve and the FDIC, dispute this contention. The Federal Reserve, having examined the evidence, holds that empirical research has not validated any relationship between the CRA and the 2008 financial crisis[100]. At the FDIC, Chair Sheila Bair delivered remarks noting that the majority of subprime loans originated from lenders not regulated by the CRA, calling it a "scapegoat" and declaring it "NOT guilty."[101]
it was not the sole problem, but there is no denying that it WAS part of this mess....WAY too many bad loans was made and hence, came foreclosures....no money down loans, there was homes made available where no prop taxes was included for the first five years....Variable Rate Loans was introduced to attract and entice home ownerships..all of this was spurred on by CRA, to raise the percentage of minority home ownership....btw, we had Fed - Oversite Committees that was supposed to be watching over this...what happened?
Quote from: Henry Hawk on April 27, 2010, 02:46:23 PM
it was not the sole problem, but there is no denying that it WAS part of this mess....WAY too many bad loans was made and hence, came foreclosures....no money down loans, there was homes made available where no prop taxes was included for the first five years....Variable Rate Loans was introduced to attract and entice home ownerships..all of this was spurred on by CRA, to raise the percentage of minority home ownership....btw, we had Fed - Oversite Committees that was supposed to be watching over this...what happened?
Where is your evidence? The prior postings demonstrate that things were as I implied them to be; the feds provided the guidelines and the financial entities under their control complied. Those not did as they saw fit and created the mess.
Some legal and financial experts note that CRA regulated loans tend to be safe and profitable, and that subprime excesses came mainly from institutions not regulated by the CRA. In the February 2008 House hearing, law professor Michael S. Barr, a Treasury Department official under President Clinton,[67][113] stated that a Federal Reserve survey showed that affected institutions considered CRA loans profitable and not overly risky.
http://en.wikipedia.org/wiki/Community_Reinvestment_Act#Relation_to_2008_financial_crisis
67
67.^ a b Statement by President Bill Clinton at the Signing of the Financial Modernization Bill, U.S. Treasury Department Office of Public Affairs, November 12, 1999.113^ Description of Michael S. Barr, Nonresident Senior Fellow, Brookings Institute.
Quote from: Palehorse on April 27, 2010, 02:51:25 PM
Where is your evidence? The prior postings demonstrate that things were as I implied them to be; the feds provided the guidelines and the financial entities under their control complied. Those not did as they saw fit and created the mess.
where is your proof the the US government forced banks to make bad loans?
Quote from: Henry Hawk on April 27, 2010, 02:46:23 PMit was not the sole problem, but there is no denying that it WAS part of this mess....WAY too many bad loans was made and hence, came foreclosures....no money down loans, there was homes made available where no prop taxes was included for the first five years....Variable Rate Loans was introduced to attract and entice home ownerships..all of this was spurred on by CRA, to raise the percentage of minority home ownership....btw, we had Fed - Oversite Committees that was supposed to be watching over this...what happened?
I got to say one thing Henry. Moonglow, just like a broadside salvo from the battleship Missouri, he sure blew you out of the water on the government causing the realestate bubble. Don't you think is about time to say uncle :uncle: :uncle: :uncle:
The Troll :laugh: :laugh: :laugh:
Like my Papa(born in 1897) used to say, " God damned Jew bankers, they'd kill ya just to take your property".
http://www.youtube.com/watch?v=ivmL-lXNy64 (http://www.youtube.com/watch?v=ivmL-lXNy64) from Affirmative action's mouth..
and Barney Frank says..... http://www.youtube.com/watch?v=XVIAGWtCD10 (http://www.youtube.com/watch?v=XVIAGWtCD10)
and another video, explaining govs involvement... http://www.youtube.com/watch?v=RYz1rbB5V1s&feature=related (http://www.youtube.com/watch?v=RYz1rbB5V1s&feature=related)
Quote from: Moonglow on April 27, 2010, 03:15:58 PM
where is your proof the the US government forced banks to make bad loans?
I never said they did. . . Henry is saying it and I am not.
Quote from: Henry Hawk on April 27, 2010, 03:47:05 PM
http://www.youtube.com/watch?v=ivmL-lXNy64 (http://www.youtube.com/watch?v=ivmL-lXNy64) from Affirmative action's mouth..
and Barney Frank says..... http://www.youtube.com/watch?v=XVIAGWtCD10 (http://www.youtube.com/watch?v=XVIAGWtCD10)
and another video, explaining govs involvement... http://www.youtube.com/watch?v=RYz1rbB5V1s&feature=related (http://www.youtube.com/watch?v=RYz1rbB5V1s&feature=related)
You tube??? :rolleyes:
Quote from: Palehorse on April 27, 2010, 04:01:25 PM
You tube??? :rolleyes:
yeah, real actual video of actual people actually saying something is pretty bad evidence, huh?.....the evidence being stated directly from a persons mouth....my bad.
I am going to liquidate all my material belongings, purchase land paying cash in some deserted wilderness area of British Columbia, and arm myself to the teeth; shooting anyone who dares encroach upon my property.
It appears to be the only way I can escape this delusional hysteria so many in this country seem hell bent on pursuing. :yes:
You idiots can go ahead and let this country collapse, watch millions die cold, sick, and hungry on its city's streets and alleyways, and live within the draconian laws you so desperately want.
I'll content myself with leaving the place until you've all shriveled up and died while incarcerated for violation of some of the very draconian laws you squealed for. . . Those that don't will be goose-stepping in the employ of the Russian army; the new rulers of the United States of Amerika. . .
Quote from: Henry Hawk on April 27, 2010, 03:47:05 PMhttp://www.youtube.com/watch?v=ivmL-lXNy64 (http://www.youtube.com/watch?v=ivmL-lXNy64) from Affirmative action's mouth.. and Barney Frank says..... http://www.youtube.com/watch?v=XVIAGWtCD10 (http://www.youtube.com/watch?v=XVIAGWtCD10) and another video, explaining govs involvement... http://www.youtube.com/watch?v=RYz1rbB5V1s&feature=related (http://www.youtube.com/watch?v=RYz1rbB5V1s&feature=related)
I tried to watch your YouTubes. When it comes from Fox New Network and Republican shills, it turns me off. The Republican have lied so much, I would believe a thing the said, if their tongue's was notarized. Just look at the vote on trying to regulate the banks and the stockmarket. 100% of the Republicans voted NO. The Republican Party is in the pocket of the Supercapitialist. Money, Money.
I tell you one thing, the smart banks didn't loans to people who made $30,000 a year, a loan to buy a $500,000 house or a person who didn't have a job a loan to buy any house. I sold my dad's home a year and a half ago, you should have seen the credit check of the couple that bought the house. It was a small town bank. I seen all of the paper work and I had to sign most of it. I even sign a paper saying my dad didn't owe anyone any money.
I spent over an hour at the title loan office. I know it for a fact.
The Troll
Quote from: The Troll on April 27, 2010, 06:36:54 PM
I tried to watch your YouTubes. When it comes from Fox New Network and Republican shills, it turns me off. The Republican have lied so much, I would believe a thing the said, if their tongue's was notarized. Just look at the vote on trying to regulate the banks and the stockmarket. 100% of the Republicans voted NO. The Republican Party is in the pocket of the Supercapitialist. Money, Money.
I tell you one thing, the smart banks didn't loans to people who made $30,000 a year, a loan to buy a $500,000 house or a person who didn't have a job a loan to buy any house. I sold my dad's home a year and a half ago, you should have seen the credit check of the couple that bought the house. It was a small town bank. I seen all of the paper work and I had to sign most of it. I even sign a paper saying my dad didn't owe anyone any money.
I spent over an hour at the title loan office. I know it for a fact.
The Troll
You spend that much time at the title office with most any closing and longer with others. They bought with a conforming loan which does have strict rules. There is a huge difference between a conforming and a nonconforming mortgage loan.
Quote from: Henry Hawk on April 27, 2010, 02:46:23 PM
it was not the sole problem, but there is no denying that it WAS part of this mess....WAY too many bad loans was made and hence, came foreclosures....no money down loans, there was homes made available where no prop taxes was included for the first five years....Variable Rate Loans was introduced to attract and entice home ownerships..all of this was spurred on by CRA, to raise the percentage of minority home ownership....btw, we had Fed - Oversite Committees that was supposed to be watching over this...what happened?
Henry, I have no idea where you are getting these ideas, but eleven years ago I was compliance officer for a bank. We did not make mortgage loans under the CRA where we had any doubt of the borrower's ability to pay, because the last thing we wanted were a bunch of repossessed houses in bad neighborhoods on the books. Use your head. We made loans in former red-lined neighborhoods, but only when the money was solid. And we required a down-payment. And we had no control over property taxes. (Where the hell did that come from anyway? Banks don't set property taxes.)
Furthermore, the 5- and 7-year ARMS came into being for the convenience of the "flippers" -- those real estate players who would buy a house, hold it a year, then sell it for more than they had in it. A lot of those folks did get caught when the bubble burst, but not because they had bought a super-expensive house for next to nothing. They got caught because they bought a bunch of houses, and there was suddenly no market for them.
The CRA was a pain in the ass because it required MUCH MORE documentation of borrowers in questionable neighborhoods, not because it tossed out cash like a flower girl at Donald Trump's last wedding.
I can't help believing you just knee-jerked at the title of the Act. Or you listened to a knee-jerker. Because you never read the act. Wudja like me to recite it?
Quote from: Palehorse on April 27, 2010, 04:00:58 PM
I never said they did. . . Henry is saying it and I am not.
Sorry :razz:
Quote from: LOsborne on April 27, 2010, 07:12:48 PM
Henry, I have no idea where you are getting these ideas, but eleven years ago I was compliance officer for a bank. We did not make mortgage loans under the CRA where we had any doubt of the borrower's ability to pay, because the last thing we wanted were a bunch of repossessed houses in bad neighborhoods on the books. Use your head. We made loans in former red-lined neighborhoods, but only when the money was solid. And we required a down-payment. And we had no control over property taxes. (Where the hell did that come from anyway? Banks don't set property taxes.)
Furthermore, the 5- and 7-year ARMS came into being for the convenience of the "flippers" -- those real estate players who would buy a house, hold it a year, then sell it for more than they had in it. A lot of those folks did get caught when the bubble burst, but not because they had bought a super-expensive house for next to nothing. They got caught because they bought a bunch of houses, and there was suddenly no market for them.
The CRA was a pain in the ass because it required MUCH MORE documentation of borrowers in questionable neighborhoods, not because it tossed out cash like a flower girl at Donald Trump's last wedding.
I can't help believing you just knee-jerked at the title of the Act. Or you listened to a knee-jerker. Because you never read the act. Wudja like me to recite it?
Banks did not do the risky no doc loans, mortgage brokers did and they went through the noncomplying branches of the large mortgage companies like National City, Countrywide, Wells Fargo, and GMAC.
Quote from: me on April 27, 2010, 09:51:02 PM
Banks did not do the risky no doc loans, mortgage brokers did and they went through the noncomplying branches of the large mortgage companies like National City, Countrywide, Wells Fargo, and GMAC.
Right. And they weren't regulated by the CRA. Let's hang 'em.
Quote from: me on April 27, 2010, 09:51:02 PM
Banks did not do the risky no doc loans, mortgage brokers did and they went through the noncomplying branches of the large mortgage companies like National City, Countrywide, Wells Fargo, and GMAC.
Exactly. . . So why you so ready to hand the gubment from da highest oak?
Quote from: Palehorse on April 27, 2010, 10:22:20 PM
Exactly. . . So why you so ready to hand the gubment from da highest oak?
Because they were the ones that did the risky loans to the people the government wanted to be able to have houses. It is just a different pocket is all. Same banks, different departments. You couldn't walk into a National City bank in town and get a non conforming loan but you could go to a mortgage broker and get a non conforming loan from National City bank. Like I said, same banks different pockets. The just kept the nonconforming secondary market mortgages separate and didn't offer them through the normal bank is all.
Quote from: me on April 27, 2010, 11:10:26 PM
Because they were the ones that did the risky loans to the people the government wanted to be able to have houses. It is just a different pocket is all. Same banks, different departments. You couldn't walk into a National City bank in town and get a non conforming loan but you could go to a mortgage broker and get a non conforming loan from National City bank. Like I said, same banks different pockets. The just kept the nonconforming secondary market mortgages separate and didn't offer them through the normal bank is all.
Now your trying to make the evidence fit your objective / perspective. A bank either was, or was not a member of the CRA; and if they were a member they were required to operate within its policies at all times.
Now, I'm not saying that some of them didn't try to play both sides of the fence, and in those cases it is indeed shame on the congressional oversight panel and its auditors for not seeing it. But again, outside of the oversight failure(s) government did not in any way endorse the non CRA endorsed programs or efforts. You are trying to blame them for the dishonest practices of thieves, who numbered at levels that would have required a virtual army of auditors to be employed by the government in order to catch them. . .
No I am not. I'm telling you how it was.
Quote from: Palehorse on April 27, 2010, 11:32:35 PM
Now your trying to make the evidence fit your objective / perspective. A bank either was, or was not a member of the CRA; and if they were a member they were required to operate within its policies at all times.
Now, I'm not saying that some of them didn't try to play both sides of the fence, and in those cases it is indeed shame on the congressional oversight panel and its auditors for not seeing it. But again, outside of the oversight failure(s) government did not in any way endorse the non CRA endorsed programs or efforts. You are trying to blame them for the dishonest practices of thieves, who numbered at levels that would have required a virtual army of auditors to be employed by the government in order to catch them. . .
Quote from: me on April 27, 2010, 11:10:26 PM
Because they were the ones that did the risky loans to the people the government wanted to be able to have houses.
The government did not guarantee non-conforming loans. That's why they are called "non-conforming." These are "portfolio" loans that the bank holds in-house or sells to investment companies that are not government backed. A lot of them were jumbo loans; i.e. loans for more than the limit set by the GSE's (currently in the neighborhood of $400 K,) and therefore not eligible for purchase by a Government Sponsored Enterprise. The Fannie and Freddie fiasco was triggered by creative accounting, not by making bad loans.
Quote from: LOsborne on April 28, 2010, 08:13:38 AM
The government did not guarantee non-conforming loans. That's why they are called "non-conforming." These are "portfolio" loans that the bank holds in-house or sells to investment companies that are not government backed. A lot of them were jumbo loans; i.e. loans for more than the limit set by the GSE's (currently in the neighborhood of $400 K,) and therefore not eligible for purchase by a Government Sponsored Enterprise. The Fannie and Freddie fiasco was triggered by creative accounting, not by making bad loans.
No, they weren't government backed, as in guaranteed, but the money came out of the same pocket and it was encouraged by the government so everyone could afford a house.
Quote from: me on April 28, 2010, 09:39:22 AM
No, they weren't government backed, as in guaranteed, but the money came out of the same pocket and it was encouraged by the government so everyone could afford a house.
:genius: Keep on defending all of the thieves and crooks that wrote all of those fraudant loans.
Please, :genius: tell me how does a person who is reading and approving these loans, if they are coming from legal, state licenced regulated realestate company, when the whole damn application form is a lie from the start to end and it's all lies. Hummmmmmmmmmm. :genius:
It must be a :wacko: :wacko: :flap: :flap: :flap: thing.
The Troll :salute:
I'm just a bill
Yes, I'm only a bill
And I'm sitting here on Capitol Hill.
Well, it's a long long journey
To Capitol city
It's a long long wait
While I'm sitting in committee,
But I know I'll be law someday
At least I hope and pray that I will,
But today I am still just a bill.
Quote from: The Troll on April 28, 2010, 10:56:39 AM
:genius: Keep on defending all of the thieves and crooks that wrote all of those fraudant loans.
Please, :genius: tell me how does a person who is reading and approving these loans, if they are coming from legal, state licenced regulated realestate company, when the whole damn application form is a lie from the start to end and it's all lies. Hummmmmmmmmmm. :genius:
It must be a :wacko: :wacko: :flap: :flap: :flap: thing.
The Troll :salute:
Whatever skippy just keep right on believing that the BS you're being fed.
Quote from: me on April 28, 2010, 12:48:48 PM
Whatever skippy just keep right on believing that the BS you're being fed.
What ever Limpy, what size spoon have you've been using. It must be a large one for you to swallow all of the B.S., your Republican Party, Your Teaparty, Sara Palin and "ME" is putting out.
:bsm2:
Quote from: Sandy Eggo on April 28, 2010, 12:13:00 PM
I'm just a bill
Yes, I'm only a bill
And I'm sitting here on Capitol Hill.
Well, it's a long long journey
To Capitol city
It's a long long wait
While I'm sitting in committee,
But I know I'll be law someday
At least I hope and pray that I will,
But today I am still just a bill.
School House Rock!!!!!
LoL!
I will never forget that one in particular.
I was sitting in American Government class taking a final and this song, from my childhood memory banks, saved my arse. :biggrin:
Quote from: followsthewolf on April 28, 2010, 03:18:17 PM
School House Rock!!!!!
THAT'S where I remember it from! :rolleyes: :biggrin:
Quote from: Sandy Eggo on April 28, 2010, 04:37:50 PM
LoL!
I will never forget that one in particular.
I was sitting in American Government class taking a final and this song, from my childhood memory banks, saved my arse. :biggrin:
Have actually used them in classes!!!
Quote from: me on April 28, 2010, 09:39:22 AM
No, they weren't government backed, as in guaranteed, but the money came out of the same pocket and it was encouraged by the government so everyone could afford a house.
:wall: :wall: :wall:
What was the gain to the government? How does anybody win with a bunch of repo-ed crappy houses back on the books? This financial CF was brought about by greed. Worthless houses on the market do not fill anyone's piggy bank.
The government does not and can not mandate loans. The CRA loans are conforming and scrutinized within an inch of privacy law violations. The mortgage melt-down was caused by non-conforming loans, fantasy accounting to paint a false picture of profits, and synthetic CDOs. It was not caused by "the government so everyone could afford a house."
SANDY!! You're supposed to warn me (that's me-Lolly, not me- who believes something is true because she believes it despite all evidence to the contrary
) before I start getting spittle on my keyboard!
Quote from: followsthewolf on April 28, 2010, 03:18:17 PM
School House Rock!!!!!
Ya'll
gotta remember
Lolly-lolly-lolly get your adverbs here!
I find it impossible to follow the bastardized logic of some people. . . (oops, I thought this was the random comments topic!) :icon_twisted:
You talkin' to me? You talkin' to me? You talkin' to me? Then who the hell else are you talking... you talking to me? ...
Quote from: LOsborne on April 28, 2010, 08:17:43 PM
You talkin' to me? You talkin' to me? You talkin' to me? Then who the hell else are you talking... you talking to me? ...
:biggrin:
Here ya go http://www.dallasfed.org/research/eclett/2007/el0711.html
http://homebuying.about.com/od/findingalender/qt/0307subprime.htm
http://www.marketoracle.co.uk/Article372.html
It took u 2 days to find just those articles?
Nope just looked tonight.
If you actually read your articles, instead of just googling key words, you would have found each one of them said exactly what I did: the mortgage meltdown was caused by non-conforming loans, fantasy accounting to paint a false picture of profits, and synthetic CDOs, not by the government "mandating" (or even encouraging) loans to non-qualified buyers. The culprits were the greedy brokers and fund managers, stupid people who really believed what these con-men told them, and accountants who answer the question "How much is 2 plus 2?" with the words "How much do you want it to be?"
Clinton did admit that he encouraged loans to the poor and minority but he didn't intend for $500,000 dollars homes for those that could afford a $50,000 dollar home.
Quote from: Moonglow on April 29, 2010, 08:23:00 AM
Clinton did admit that he encouraged loans to the poor and minority but he didn't intend for $500,000 dollars homes for those that could afford a $50,000 dollar home.
Moonglow, we have one real problem here in the Unknown Zone. We have people who's only source of political news and information about what going on in this world is. Fox News, Sean Hannity, Bill O'Reilly, Rush Limbaugh, Sara Palin, Michell Backman and teacher/preacher with a blackboard, Glen Beck. These poor people are caught in a cycle like the movie, Groundhog Day.
:wall: :wall: :wall: :pray: :pray: :pray: :pink: :pink: :pink: :fireworks: :fireworks:
Quote from: LOsborne on April 29, 2010, 07:48:21 AM
If you actually read your articles, instead of just googling key words, you would have found each one of them said exactly what I did: the mortgage meltdown was caused by non-conforming loans, fantasy accounting to paint a false picture of profits, and synthetic CDOs, not by the government "mandating" (or even encouraging) loans to non-qualified buyers. The culprits were the greedy brokers and fund managers, stupid people who really believed what these con-men told them, and accountants who answer the question "How much is 2 plus 2?" with the words "How much do you want it to be?"
It may not have been what you meant but I took your one statement to mean that the government didn't encourage or have anything to do with the non complying loans. Did you read this part of the first article?
[These new practices opened the housing market to millions of Americans, pushing the homeownership rate from 63.8 percent in 1994 to a record 69.2 percent in 2004. Although low interest rates bolstered homebuying early in the decade, the expansion of nonprime mortgages clearly played a role in the surge of homeownership.
Two crucial developments spurred nonprime mortgages' rapid growth. First, mortgage lenders adopted the credit-scoring techniques first used in making subprime auto loans. With these tools, lenders could better sort applicants by creditworthiness and offer them appropriately risk-based loan rates.
By itself, credit scoring couldn't have fostered the rapid growth of nonprime lending. Banks lack the equity capital needed to hold large volumes of these risky loans in their portfolios. And lenders of all types couldn't originate and then sell these loans to investors in the form of residential mortgage-backed securities, or RMBS—at least not without added protection against defaults.
The spread of new products offering default protection was the second crucial development that fostered subprime lending growth. Traditionally, banks made prime mortgages funded with deposits from savers. By the 1980s and 1990s, the need for deposits had eased as mortgage lenders created a new way for funds to flow from savers and investors to prime borrowers through government-sponsored enterprises (GSEs) (Chart 2, upper panel).
Chart 2: Mortgage financial flows
Fannie Mae and Freddie Mac are the largest GSEs, with Ginnie Mae being smaller. These enterprises guarantee the loans and pool large groups of them into RMBS. They're then sold to investors, who receive a share of the payments on the underlying mortgages. Because the GSEs are federally chartered, investors perceive an implicit government guarantee of them. Fannie Mae and Freddie Mac, however, haven't packaged many nonprime mortgages into RMBS.Lacking the same perceived status, nonagency RMBS—those not issued by Fannie Mae, Freddie Mac and Ginnie Mae—faced the hurdle of paying investors extremely large premiums to compensate them for high default risk. These high costs would have pushed nonprime interest rates to levels outside the reach of targeted borrowers.
This is where financial innovations came into play. Some—like collateralized debt obligations (CDOs), a common RMBS derivative—were designed to protect investors in nonagency securities against default losses. Such CDOs divide the streams of income that flow from the underlying mortgages into tranches that absorb default losses according to a preset priority.
The lowest-rated tranche absorbs the first defaults on the pool of underlying mortgages, with successively higher ranked and rated tranches absorbing any additional defaults. If defaults turn out to be low, there may be no losses for higher-ranked tranches to absorb. But if defaults are much greater than expected, even higher-rated tranches may face losses.
Having confidence in the ability of quantitative models to accurately measure nonprime default risk, a brisk market emerged for securities backed by nonprime loans. The combination of new credit-scoring techniques and new nonagency RMBS products enabled nonprime-rated applicants to qualify for mortgages, opening a new channel for funds to flow from savers to a new class of borrowers in this decade (Chart 2, lower panel).]
Quote from: LOsborne on April 28, 2010, 08:06:02 PM
:wall: :wall: :wall:
What was the gain to the government? How does anybody win with a bunch of repo-ed crappy houses back on the books? This financial CF was brought about by greed. Worthless houses on the market do not fill anyone's piggy bank.
The government does not and can not mandate loans. The CRA loans are conforming and scrutinized within an inch of privacy law violations. The mortgage melt-down was caused by non-conforming loans, fantasy accounting to paint a false picture of profits, and synthetic CDOs. It was not caused by "the government so everyone could afford a house."
They were government backed and encouraged by the government so more people could afford housing.
SANDY!! You're supposed to warn me (that's me-Lolly, not me- who believes something is true because she believes it despite all evidence to the contrary) before I start getting spittle on my keyboard!
Now let us sing, one, two, three, M I C ___ K E Y ____ M O U S E. Mickey Mouse, Mickey Mouse, let hold our banner high. :deadhorse: :deadhorse: People who can't see what they won't see. :wall: :wall: :wink: :biggrin:
The Troll, let's :pray: for them.
Quote from: me on April 29, 2010, 09:54:46 AM
It may not have been what you meant but I took your one statement to mean that the government didn't encourage or have anything to do with the non complying loans. Did you read this part of the first article?
Yes, I did.
QuoteThese new practices opened the housing market ... expansion of nonprime mortgages clearly played a role in the surge of homeownership.
... mortgage lenders adopted the credit-scoring techniques first used in making subprime auto loans. With these tools, lenders could better sort applicants by creditworthiness and offer them appropriately risk-based loan rates.
... the rapid growth of nonprime lending. ... mortgage-backed securities, or RMBS
...
. Fannie Mae and Freddie Mac, however, haven't packaged many nonprime mortgages into RMBS
... nonagency RMBS—those not issued by Fannie Mae, Freddie Mac and Ginnie Mae... collateralized debt obligations (CDOs), a common RMBS derivative—were designed to protect investors in nonagency securities...
The combination of new credit-scoring techniques and new nonagency RMBS products enabled nonprime-rated applicants to qualify for mortgages...
There. I reduced it to the operative phrases, and put the culprits in bold. Now do you get it? Non-conforming sub-primes and non-primes (neither of which carry government guarantees,) CDOs -- especially synthetic CDOs which are artificial constructs holding NO real assets, used to "lay-off" (that is, bet
against) the fund making money so the brokering house makes money either way, and creative accountants who screwed around with the way credit-worthiness is assessed.
Funny how you underlined the sentence about the GSE's guaranteeing loans and pooling them into RMBS's, but somehow missed the following sentence which states Fannie, Freddie and Ginnie don't package non-primes.
I just can't understand why you want to make the gubment the bad guy here, instead of taking a real hard look at the folks who made money off the game.
Well said. :yes:
Quote from: LOsborne on April 29, 2010, 07:06:44 PM
. . .
I just can't understand why you want to make the gubment the bad guy here, instead of taking a real hard look at the folks who made money off the game.
Yes you can; just think about it for a second or two. . . :wink:
(Hint: If the Shrub was still in or Johnny boy. . .)
A bud in the hand will make u forget about the Busch. :razz:
Quote from: Moonglow on April 29, 2010, 10:54:16 PM
A bud in the hand will make u forget about the Busch. :razz:
:biggrin: