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Thread: Bloomberg - How the Democrats Created the Financial Crisis

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    Default Bloomberg - How the Democrats Created the Financial Crisis

    (snip)"Sept. 22 (Bloomberg) -- The financial crisis of the past year has provided a number of surprising twists and turns, and from Bear Stearns Cos. to American International Group Inc., ambiguity has been a big part of the story.

    Why did Bear Stearns fail, and how does that relate to AIG? It all seems so complex.

    But really, it isn't. Enough cards on this table have been turned over that the story is now clear. The economic history books will describe this episode in simple and understandable terms: Fannie Mae and Freddie Mac exploded, and many bystanders were injured in the blast, some fatally.

    Fannie and Freddie did this by becoming a key enabler of the mortgage crisis. They fueled Wall Street's efforts to securitize subprime loans by becoming the primary customer of all AAA-rated subprime-mortgage pools. In addition, they held an enormous portfolio of mortgages themselves.

    In the times that Fannie and Freddie couldn't make the market, they became the market. Over the years, it added up to an enormous obligation. As of last June, Fannie alone owned or guaranteed more than $388 billion in high-risk mortgage investments. Their large presence created an environment within which even mortgage-backed securities assembled by others could find a ready home.

    The problem was that the trillions of dollars in play were only low-risk investments if real estate prices continued to rise. Once they began to fall, the entire house of cards came down with them.

    Turning Point

    Take away Fannie and Freddie, or regulate them more wisely, and it's hard to imagine how these highly liquid markets would ever have emerged. This whole mess would never have happened.

    It is easy to identify the historical turning point that marked the beginning of the end.

    Back in 2005, Fannie and Freddie were, after years of dominating Washington, on the ropes. They were enmeshed in accounting scandals that led to turnover at the top. At one telling moment in late 2004, captured in an article by my American Enterprise Institute colleague Peter Wallison, the Securities and Exchange Comiission's chief accountant told disgraced Fannie Mae chief Franklin Raines that Fannie's position on the relevant accounting issue was not even ``on the page'' of allowable interpretations.

    Then legislative momentum emerged for an attempt to create a ``world-class regulator'' that would oversee the pair more like banks, imposing strict requirements on their ability to take excessive risks. Politicians who previously had associated themselves proudly with the two accounting miscreants were less eager to be associated with them. The time was ripe.

    Greenspan's Warning

    The clear gravity of the situation pushed the legislation forward. Some might say the current mess couldn't be foreseen, yet in 2005 Alan Greenspan told Congress how urgent it was for it to act in the clearest possible terms: If Fannie and Freddie ``continue to grow, continue to have the low capital that they have, continue to engage in the dynamic hedging of their portfolios, which they need to do for interest rate risk aversion, they potentially create ever-growing potential systemic risk down the road,'' he said. ``We are placing the total financial system of the future at a substantial risk.''

    What happened next was extraordinary. For the first time in history, a serious Fannie and Freddie reform bill was passed by the Senate Banking Committee. The bill gave a regulator power to crack down, and would have required the companies to eliminate their investments in risky assets.

    Different World

    If that bill had become law, then the world today would be different. In 2005, 2006 and 2007, a blizzard of terrible mortgage paper fluttered out of the Fannie and Freddie clouds, burying many of our oldest and most venerable institutions. Without their checkbooks keeping the market liquid and buying up excess supply, the market would likely have not existed.

    But the bill didn't become law, for a simple reason: Democrats opposed it on a party-line vote in the committee, signaling that this would be a partisan issue. Republicans, tied in knots by the tight Democratic opposition, couldn't even get the Senate to vote on the matter.

    That such a reckless political stand could have been taken by the Democrats was obscene even then. Wallison wrote at the time: ``It is a classic case of socializing the risk while privatizing the profit. The Democrats and the few Republicans who oppose portfolio limitations could not possibly do so if their constituents understood what they were doing.''

    Mounds of Materials

    Now that the collapse has occurred, the roadblock built by Senate Democrats in 2005 is unforgivable. Many who opposed the bill doubtlessly did so for honorable reasons. Fannie and Freddie provided mounds of materials defending their practices. Perhaps some found their propaganda convincing.

    But we now know that many of the senators who protected Fannie and Freddie, including Barack Obama, Hillary Clinton and Christopher Dodd, have received mind-boggling levels of financial support from them over the years.

    Throughout his political career, Obama has gotten more than $125,000 in campaign contributions from employees and political action committees of Fannie Mae and Freddie Mac, second only to Dodd, the Senate Banking Committee chairman, who received more than $165,000.

    Clinton, the 12th-ranked recipient of Fannie and Freddie PAC and employee contributions, has received more than $75,000 from the two enterprises and their employees. The private profit found its way back to the senators who killed the fix.

    There has been a lot of talk about who is to blame for this crisis. A look back at the story of 2005 makes the answer pretty clear.

    Oh, and there is one little footnote to the story that's worth keeping in mind while Democrats point fingers between now and Nov. 4: Senator John McCain was one of the three cosponsors of S.190, the bill that would have averted this mess. "(snip)


    (Kevin Hassett, director of economic-policy studies at the American Enterprise Institute, is a Bloomberg News columnist. He is an adviser to Republican Senator John McCain of Arizona in the 2008 presidential election. The opinions expressed are his own.)

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    ^^^Nice spin. Good thing most americans can see through it, check out this POLL, Americans blame the republicans 2-to-1 for the current financial crisis (and rightfully so IMO).

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by Richard_Head View Post
    ^^^Nice spin. Good thing most americans can see through it, check out this POLL, Americans blame the republicans 2-to-1 for the current financial crisis (and rightfully so IMO).
    The poll gauges O P I N I O N S. Melonie spelled out the F A C T S.

    Btw, while the Dems bear the lion's share of the blame for Fannie & Freddie, that does NOT let Bush & the Republicans off the hook. There were several Republicans in both houses who took big campaign contribs and protected "Frick and Frack" form further regulation and oversight. As I've repeatedly posted, Greenspan and Bush also bear part of the blame. Who appointed Cox head of the SEC ? Bush.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by Richard_Head View Post
    ^^^Nice spin. Good thing most americans can see through it, check out this POLL, Americans blame the republicans 2-to-1 for the current financial crisis (and rightfully so IMO).
    Well, they get their info from the media, who will do or say whatever they need to get their man in.

    There is plenty of blame for the Republicans here but the fact is that the Clinton administration pushed banks into lending to people who had no business getting mortgages. These mortgages were packaged and sold to Fannie/Freddie. When the danger signs were spotted by the administration, they were minimized by Dodd, Fwank, et al. Bush, trying to be politically correct, did not press the issue.
    "never trust a big butt and a smile"-- Bell Biv DeVoe

    If you're in your twenties and aren't a liberal, you have no heart. If you're in you're forties and aren't a conservative, you have no brain - Winston Churchill

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by bem401 View Post
    Well, they get their info from the media, who will do or say whatever they need to get their man in.

    There is plenty of blame for the Republicans here but the fact is that the Clinton administration pushed banks into lending to people who had no business getting mortgages. These mortgages were packaged and sold to Fannie/Freddie. When the danger signs were spotted by the administration, they were minimized by Dodd, Fwank, et al. Bush, trying to be politically correct, did not press the issue.
    More shame on Bush. He and his team KNEW what was going on AND what would happen and just let it ride.

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    Default I'll have whatever she's smoking, bartender!

    Yeah, those Phil Gramm wing of the Democratic party morons who repealed Glass-Stegall. Damn them, damn them all to hell.

    Obviously, the only solution here is to hand the same asswipes that put us $1 trillion in debt to the Chinese is hand them a blank check.

    P.S. I heard if you repeat a lie enough, it becomes true, like: "I'm anti-Obama because he's a liberal, it doesn't have anything to do with the white hooded uniform I wear to my social club."


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    Default Re: I'll have whatever she's smoking, bartender!

    Quote Originally Posted by Ook View Post
    Yeah, those Phil Gramm wing of the Democratic party morons who repealed Glass-Stegall. Damn them, damn them all to hell.

    Obviously, the only solution here is to hand the same asswipes that put us $1 trillion in debt to the Chinese is hand them a blank check.

    P.S. I heard if you repeat a lie enough, it becomes true, like: "I'm anti-Obama because he's a liberal, it doesn't have anything to do with the white hooded uniform I wear to my social club."

    Aside from assigning Phil Gramm his fair share of the blame; the balance of your post is not worthy of response.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Well it's their playbook. Any whites not for Obama are against him because he's black. Never mind that they can't make a single cogent attitude why he deserves to be supported. Watch them attack me now.
    "never trust a big butt and a smile"-- Bell Biv DeVoe

    If you're in your twenties and aren't a liberal, you have no heart. If you're in you're forties and aren't a conservative, you have no brain - Winston Churchill

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Bush is not without guilt in this matter, but a little perspective of the actual facts seems to be in order ...

    (snip)"Bush’s Calls for Financial Reform Ignored
    Obama has blamed Bush for today’s mess. This is the biggest lie of all.

    Bush’s Calls for Financial Reform Ignored

    By: Ronald Kessler

    Triggering the financial implosion on Wall Street were the problems at Fannie Mae and Feddie Mac, which fostered lax lending practices and covered up their own financial deficiencies.

    Going back to the beginning of his administration, President Bush warned of the problems at these institutions and the consequences if Congress did not bring them under control. Seventeen times, Bush publicly called for reform of both institutions. But Democrats and Republicans in Congress ignored the warnings and denied there were any problems. What follows is an administration chronology of efforts to achieve reform:

    2005

    April: Treasury Secretary John Snow repeats his call for GSE reform, saying “Events that have transpired since I testified before this Committee in 2003 reinforce concerns over the systemic risks posed by the GSEs and further highlight the need for real GSE reform to ensure that our housing finance system remains a strong and vibrant source of funding for expanding homeownership opportunities in America…Half-measures will only exacerbate the risks to our financial system.” (Secretary John W. Snow, “Testimony Before The U.S. House Financial Services Committee,” 4/13/05 )

    2007

    July: Two Bear Stearns hedge funds invested in mortgage securities collapse.

    August: President Bush emphatically calls on Congress to pass a reform package for Fannie Mae and Freddie Mac, saying “first things first when it comes to those two institutions. Congress needs to get them reformed, get them streamlined, get them focused, and then I will consider other options.” (President George W. Bush, Press Conference, The White House, 8/9/07 )

    September: RealtyTrac announces foreclosure filings up 243,000 in August – up 115 percent from the year before.

    September: Single-family existing home sales decreases 7.5 percent from the previous month – the lowest level in nine years. Median sale price of existing homes fell six percent from the year before.

    December: President Bush again warns Congress of the need to pass legislation reforming GSEs, saying, “These institutions provide liquidity in the mortgage market that benefits millions of homeowners, and it is vital they operate safely and operate soundly. So I’ve called on Congress to pass legislation that strengthens independent regulation of the GSEs – and ensures they focus on their important housing mission. The GSE reform bill passed by the House earlier this year is a good start. But the Senate has not acted. And the United States Senate needs to pass this legislation soon.” (President George W. Bush, Discusses Housing, The White House, 12/6/07 )

    2008

    January: Bank of America announces it will buy Countrywide.

    January: Citigroup announces mortgage portfolio lost $18.1 billion in value.

    February: Assistant Secretary David Nason reiterates the urgency of reforms, says, “A new regulatory structure for the housing GSEs is essential if these entities are to continue to perform their public mission successfully.” (David Nason, Testimony On Reforming GSE Regulation, Senate Committee On Banking, Housing And Urban Affairs, 2/7/08 )

    March: Bear Stearns announces it will sell itself to JPMorgan Chase.

    March: President Bush calls on Congress to take action and “move forward with reforms on Fannie Mae and Freddie Mac. They need to continue to modernize the FHA, as well as allow State housing agencies to issue tax-free bonds to homeowners to refinance their mortgages.” (President George W. Bush, Remarks To The Economic Club Of New York, New York, NY, 3/14/08 )

    April: President Bush urges Congress to pass the much needed legislation and “modernize Fannie Mae and Freddie Mac. [There are] constructive things Congress can do that will encourage the housing market to correct quickly by … helping people stay in their homes.” (President George W. Bush, Meeting With Cabinet, the White House, 4/14/08 )

    May: President Bush issues several pleas to Congress to pass legislation reforming Fannie Mae and Freddie Mac before the situation deteriorates further.

    “Americans are concerned about making their mortgage payments and keeping their homes. Yet Congress has failed to pass legislation I have repeatedly requested to modernize the Federal Housing Administration that will help more families stay in their homes, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance sub-prime loans.” (President George W. Bush, Radio Address, 5/3/08 )

    “[T]he government ought to be helping creditworthy people stay in their homes. And one way we can do that – and Congress is making progress on this – is the reform of Fannie Mae and Freddie Mac. That reform will come with a strong, independent regulator.” (President George W. Bush, Meeting With The Secretary Of The Treasury, the White House, 5/19/08 )

    “Congress needs to pass legislation to modernize the Federal Housing Administration, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance subprime loans.” (President George W. Bush, Radio Address, 5/31/08 )

    June: As foreclosure rates continued to rise in the first quarter, the President once again asks Congress to take the necessary measures to address this challenge, saying “we need to pass legislation to reform Fannie Mae and Freddie Mac.” (President George W. Bush, Remarks At Swearing In Ceremony For Secretary Of Housing And Urban Development, Washington, D.C., 6/6/08 )

    July: Congress heeds the President’s call for action and passes reform of Fannie Mae and Freddie Mac as it becomes clear that the institutions are failing.

    Ronald Kessler is chief Washington correspondent of Newsmax.com. View his previous reports and get his dispatches sent to you free via
    e-mail. Go here now.

    © 2008 Newsmax. All rights reserved."(snip)

    from

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by Eric Stoner View Post
    The poll gauges O P I N I O N S. Melonie spelled out the F A C T S.

    Btw, while the Dems bear the lion's share of the blame for Fannie & Freddie, that does NOT let Bush & the Republicans off the hook. There were several Republicans in both houses who took big campaign contribs and protected "Frick and Frack" form further regulation and oversight. As I've repeatedly posted, Greenspan and Bush also bear part of the blame. Who appointed Cox head of the SEC ? Bush.
    Some of this is pure BALONEY and not all of the FACTS. I believe it is just not possible that the semi-poor who were enabled to piurchase homes is to blame for this whole mess. The dollars are just not there. RATHER it was the more well-to-do buyers and flippers who just bought more than they could afford when the market was riding high. They were allowed to do that by a government and financial community that knowingly looked the other way while riskier and riskier deals were made. Apparently no one figure out what could occur if the market topped off.

    I can understand why greater home ownership is a reasonable, even laudable goal, as long as it is done responsibly. It helps anchor a community and foster its benefits to family life, stop its physical deterioration, reduce the incidence of crime, and allow more people to work themselves over time further out of poverty. There is nothing wrong with any of those benefits. But a different kind of care is required to qualify loans and properties than for the well-to-do who produce increasingly more consumption and where those above benefits are not much of a consideration.

    Even before the home ownership populism took place, the Reagan Republicans' deregulation occurred, which, for one easy-to-remember and unpopular act, broke down the usury laws, started this whole financial free-for-all mess. Whether or not 90s home ownership initiative was done well, the financial jungle that the current administration allowed is very irresponsible. Achieving their goal of further deregulation was just purely irresponsible

    It's so easy to blame whom you do not like, but in reality, everyone had a part in this and should share the blame. Even those who over-reached their consumption limits and a do-nothing FTC.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    In my opinion it was deregulation that caused this shit to happen.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by Richard_Head View Post
    ^^^Nice spin. Good thing most americans can see through it, check out this POLL, Americans blame the republicans 2-to-1 for the current financial crisis (and rightfully so IMO).
    You find me something that most Americans wouldn't blame the Republicans for and I'll be surprised. And if you argue (like some morons think) "everything is the Republicans fault", then well... I won't have put much stock in your opinion.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by jester214 View Post
    You find me something that most Americans wouldn't blame the Republicans for and I'll be surprised.
    Shouldn't that be saying something?

    If one person thinks you're an asshole, you have yourself a hater. If everyone thinks you're an asshole, well, maybe you're just an asshole.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by TheSexKitten View Post
    Shouldn't that be saying something?

    If one person thinks you're an asshole, you have yourself a hater. If everyone thinks you're an asshole, well, maybe you're just an asshole.
    A some level sure, but the whole Republican party is not to blame for everything bad in the world, while the whole Democratic party is responsible for everything good in the world.

    But if you pose just about anything to the average person and ask who's responsible, if it's negative, they'll say Republicans. THAT doesn't carry much weight with me.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by TheSexKitten View Post
    Shouldn't that be saying something?

    If one person thinks you're an asshole, you have yourself a hater. If everyone thinks you're an asshole, well, maybe you're just an asshole.
    Or you are really good at your job. *shrug*

    Mother Teresa and Ghandi both had a slew of haters, doesn't make them wrong or bad people or assholes; in fact I don't think anyone can argue they were both amazing, loving, good people. But even they had haters.
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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by jester214 View Post
    But if you pose just about anything to the average person and ask who's responsible, if it's negative, they'll say Republicans. THAT doesn't carry much weight with me.
    I understand, especially when many people who say that haven't bothered to pinpoint exactly what it is that makes their judgment valid. Still though, there is a pattern and I think the Republican Party (in general) needs to step back and reexamine its priorities.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    I am with you Mel, I think responsibility falls on three things. The CEO's of these companies, the people who bit off more than they can chew on their morgages, and the Dems, since they saw it coming and did nothing, and said nothing was wrong.

    http://query.nytimes.com/gst/fullpag...=&pagewanted=1

    Sorry guys, but between the Israel thing, and the gun rights thing, Obama has TWO former Fannie Mae CEO's as financial advisors. Those are the LAST people I want in charge of our country. Hell, they can't even balance a company budget, how much of a cluster fuck will they make of this country?!

    ************************************************** ***************

    The Carter-era Community Reinvestment Act forced banks to lend to uncreditworthy borrowers, mostly in minority areas.

    Bush Called For Reform of Fannie Mae & Freddie Mac 34 Times Since Taking Office In 2001... Dems Ignored Warnings

    Obama not only has ignored warnings but received over $129, 000 from Fannie Mae and has 2 CEO’s from Fannie Mae as his Economic Advisors.

    For many years the President and his Administration have not only warned of the systemic consequences of financial turmoil at a housing government-sponsored enterprise (GSE) but also put forward thoughtful plans to reduce the risk that either Fannie Mae or Freddie Mac would encounter such difficulties. President Bush publicly called for GSE reform.

    Government Records

    ** 2001

    April: The Administration’s FY02 budget declares that the size of Fannie Mae and Freddie Mac is "a potential problem, " because "financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity."

    ** 2002

    May: The President calls for the disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac.
    (OMB Prompt Letter to OFHEO, 5/29/02)

    ** 2003

    January: Freddie Mac announces it has to restate financial results for the previous three years.

    February: The Office of Federal Housing Enterprise Oversight (OFHEO) releases a report explaining that "although investors perceive an implicit Federal guarantee of [GSE] obligations, " "the government has provided no explicit legal backing for them." As a consequence, unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market.
    ("Systemic Risk: Fannie Mae, Freddie Mac and the Role of OFHEO, " OFHEO Report, 2/4/03)

    September: Fannie Mae discloses SEC investigation and acknowledges OFHEO’s review found earnings manipulations.


    September: Treasury Secretary John Snow testifies before the House Financial Services Committee to recommend that Congress enact "legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises" and set prudent and appropriate minimum capital adequacy requirements.

    October: Fannie Mae discloses $1.2 billion accounting error.

    November: Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any "legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk." To reduce the potential for systemic instability, the regulator would have "broad authority to set both risk-based and minimum capital standards" and "receivership powers necessary to wind down the affairs of a troubled GSE." (N.
    Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03)

    ** 2004

    February: The President’s FY05 Budget again highlights the risk posed by the explosive growth of the GSEs and their low levels of required capital, and called for creation of a new, world-class regulator: "The Administration has determined that the safety and soundness regulators of the housing GSEs lack sufficient power and stature to meet their responsibilities, and therefore…should be replaced with a new strengthened regulator." (2005 Budget Analytic Perspectives, pg.
    83)

    February: CEA Chairman Mankiw cautions Congress to "not take [the financial market’s] strength for granted." Again, the call from the Administration was to reduce this risk by "ensuring that the housing GSEs are overseen by an effective regulator." (N.
    Gregory Mankiw, Op-Ed, "Keeping Fannie And Freddie’s House In Order, " Financial Times, 2/24/04)

    June: Deputy Secretary of Treasury Samuel Bodman spotlights the risk posed by the GSEs and called for reform, saying "We do not have a world-class system of supervision of the housing government sponsored enterprises (GSEs), even though the importance of the housing financial system that the GSEs serve demands the best in supervision to ensure the long-term vitality of that system. Therefore, the Administration has called for a new, first class, regulatory supervisor for the three housing GSEs: Fannie Mae, Freddie Mac, and the Federal Home Loan Banking System.
    " (Samuel Bodman, House Financial Services Subcommittee on Oversight and Investigations Testimony, 6/16/04)

    ** 2005

    April: Treasury Secretary John Snow repeats his call for GSE reform, saying "Events that have transpired since I testified before this Committee in 2003 reinforce concerns over the systemic risks posed by the GSEs and further highlight the need for real GSE reform to ensure that our housing finance system remains a strong and vibrant source of funding for expanding homeownership opportunities in America… Half-measures will only exacerbate the risks to our financial system." (Secretary John W. Snow, "Testimony Before The U.S.
    House Financial Services Committee, " 4/13/05)

    In 2005-- Senator John McCain partnered with three other Senate Republicans to reform the government’s involvement in lending.

    Democrats blocked this reform, too.

    ** 2007

    July: Two Bear Stearns hedge funds invested in mortgage securities collapse.

    August: President Bush emphatically calls on Congress to pass a reform package for Fannie Mae and Freddie Mac, saying "first things first when it comes to those two institutions. Congress needs to get them reformed, get them streamlined, get them focused, and then I will consider other options." (President George W.
    Bush, Press Conference, The White House, 8/9/07)

    September: RealtyTrac announces foreclosure filings up 243, 000 in August – up 115 percent from the year before.

    September: Single-family existing home sales decreases 7.5 percent from the previous month – the lowest level in nine years. Median sale price of existing homes fell six percent from the year before.

    December: President Bush again warns Congress of the need to pass legislation reforming GSEs, saying "These institutions provide liquidity in the mortgage market that benefits millions of homeowners, and it is vital they operate safely and operate soundly. So I’ve called on Congress to pass legislation that strengthens independent regulation of the GSEs – and ensures they focus on their important housing mission. The GSE reform bill passed by the House earlier this year is a good start. But the Senate has not acted. And the United States Senate needs to pass this legislation soon." (President George W.
    Bush, Discusses Housing, The White House, 12/6/07)

    ** 2008

    January: Bank of America announces it will buy Countrywide.

    January: Citigroup announces mortgage portfolio lost $18.1 billion in value.

    February: Assistant Secretary David Nason reiterates the urgency of reforms, says "A new regulatory structure for the housing GSEs is essential if these entities are to continue to perform their public mission successfully.
    " (David Nason, Testimony On Reforming GSE Regulation, Senate Committee On Banking, Housing And Urban Affairs, 2/7/08 )

    March: Bear Stearns announces it will sell itself to JPMorgan Chase.

    March: President Bush calls on Congress to take action and "move forward with reforms on Fannie Mae and Freddie Mac. They need to continue to modernize the FHA, as well as allow State housing agencies to issue tax-free bonds to homeowners to refinance their mortgages." (President George W.
    Bush, Remarks To The Economic Club Of New York, New York, NY, 3/14/08 )

    April: President Bush urges Congress to pass the much needed legislation and "modernize Fannie Mae and Freddie Mac. [There are] constructive things Congress can do that will encourage the housing market to correct quickly by … helping people stay in their homes." (President George W.
    Bush, Meeting With Cabinet, the White House, 4/14/08 )

    May: President Bush issues several pleas to Congress to pass legislation reforming Fannie Mae and Freddie Mac before the situation deteriorates further.

    "Americans are concerned about making their mortgage payments and keeping their homes. Yet Congress has failed to pass legislation I have repeatedly requested to modernize the Federal Housing Administration that will help more families stay in their homes, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance sub-prime loans." (President George W.
    Bush, Radio Address, 5/3/08 )

    "[T]he government ought to be helping creditworthy people stay in their homes. And one way we can do that – and Congress is making progress on this – is the reform of Fannie Mae and Freddie Mac. That reform will come with a strong, independent regulator." (President George W.
    Bush, Meeting With The Secretary Of The Treasury, the White House, 5/19/08 )

    "Congress needs to pass legislation to modernize the Federal Housing Administration, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance subprime loans." (President George W.
    Bush, Radio Address, 5/31/08 )

    June: As foreclosure rates continued to rise in the first quarter, the President once again asks Congress to take the necessary measures to address this challenge, saying "we need to pass legislation to reform Fannie Mae and Freddie Mac." (President George W. Bush, Remarks At Swearing In Ceremony For Secretary Of Housing And Urban Development, Washington, D.C.
    , 6/6/08 )

    July: Congress heeds the President’s call for action and passes reform of Fannie Mae and Freddie Mac as it becomes clear that the institutions are failing.
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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    I love how Bush "calls" for things but htey never happen, but let one guy try to disconnect his brain dead wife from life support and he can get a bill through both houses of congress on an Easter weekend. If he actually wanted to do something instead of treat it like a political football he could have.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by SPLUT View Post
    I love how Bush "calls" for things but htey never happen, but let one guy try to disconnect his brain dead wife from life support and he can get a bill through both houses of congress on an Easter weekend. If he actually wanted to do something instead of treat it like a political football he could have.
    Wow! There's a point.
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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Quote Originally Posted by SPLUT View Post
    I love how Bush "calls" for things but htey never happen, but let one guy try to disconnect his brain dead wife from life support and he can get a bill through both houses of congress on an Easter weekend. If he actually wanted to do something instead of treat it like a political football he could have.
    Ahh there we go, he wanted it but was just to lazy to get it. Unlike all those other folk who did go out and get it... Oh wait, they didn't even 'call' for it, but now they sure are complaining that he didn't do something... Huh, funny.

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Yeah! And if little kids weren't so damn sexy there wouldn't be any Pedophiles either! Children cause pedophilia and democrats caused the financial crisis.

    Makes sense to me.


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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Bush Called For Reform of Fannie Mae & Freddie Mac 34 Times Since Taking Office In 2001... Dems Ignored Warnings
    If you recall, the first FOUR years Bush was in office the Republicans ran both houses and the executive branch, and likely the Judicial branch as well. So how is it that ONLY the Democrats get the blame?????
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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    ^^^ for starters, because the 'seeds' of the current financial crisis were planted many years ago when Democrats were in the white house and held majorities in congress ... because the controlling powers behind 'subprime' mortgage debt issuance, i.e. Fannie and Freddie senior management, has remained with Democrats throughout the recent periods of republican congressional majorities ... because GWB's bi-partisanism appointed Democrat Hank Paulsen as Sec. of the Treasury ...

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    ^^^I like how you continually overlook the Bush connection to this whole mess.

    Wasn't he the one bragging about his 'ownership society' not long ago???

    Here's a quote:
    "...if you own something, you have a vital stake in the future of our country. The more ownership there is in America, the more vitality there is in America, and the more people have a vital stake in the future of this country."
    -President George W. Bush, June 17, 2004


    Here's a snip:
    "Expanding Homeownership. The President believes that homeownership is the cornerstone of America's vibrant communities and benefits individual families by building stability and long-term financial security. In June 2002, President Bush issued America's Homeownership Challenge to the real estate and mortgage finance industries to encourage them to join the effort to close the gap that exists between the homeownership rates of minorities and non-minorities. The President also announced the goal of increasing the number of minority homeowners by at least 5.5 million families before the end of the decade. Under his leadership, the overall U.S. homeownership rate in the second quarter of 2004 was at an all time high of 69.2 percent. Minority homeownership set a new record of 51 percent in the second quarter, up 0.2 percentage point from the first quarter and up 2.1 percentage points from a year ago. President Bush's initiative to dismantle the barriers to homeownership includes:

    * American Dream Downpayment Initiative, which provides down payment assistance to approximately 40,000 low-income families;
    * Affordable Housing. The President has proposed the Single-Family Affordable Housing Tax Credit, which would increase the supply of affordable homes;
    * Helping Families Help Themselves. The President has proposed increasing support for the Self-Help Homeownership Opportunities Program; and
    * Simplifying Homebuying and Increasing Education. The President and HUD want to empower homebuyers by simplifying the home buying process so consumers can better understand and benefit from cost savings. The President also wants to expand financial education efforts so that families can understand what they need to do to become homeowners."

    http://www.whitehouse.gov/news/relea...0040809-9.html

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    Default Re: Bloomberg - How the Democrats Created the Financial Crisis

    Let's also not forget Phil Gramm's (you know him right? one of McCain's top economic advisors) Commodities Futures Modernization Act of 2000. This not only led to the whole Enron fiasco it also contributed greatly to many of the current housing problems.

    Gramm got the Gramm-Leach-Bliley Act passed and then inserted the Commodity Futures Modernization Act into an omnibus spending bill, and the bill was passed, largely on party lines. The effect of the CFMA was to deregulate and essentially "hide" commodities future trading from any regulatory agency and deregulated the lending industry. What resulted is steep increases in commodities prices and trading that was beneath the radar. Trillions of dollars of trading was done behind the curtain, and those unregulated trades are the primary cause of the subprime meltdown.

    Without regulation, trillions of dollars in fraudulent loans were secured for people who did not have the income to pay. Further, some teaser rate loans readjusted and increased mortgage payments by hundreds of dollars a month. And, like a house of cards, as those people who should not have been given a loan, defaulted, the situation grew worse.

    The cause of the current crisis on Wall Street is due to their hedging against unregulated and subprime loans. And as those loans fail, it brings us futher and further toward economic chaos.

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