Obama Rejects Latest GOP Spending Bill as Government Shutdown Looms

[M4A3]

You probably think time started when Obama swore in. You want to blame people for the financial straits we are in blame the banks and their Ponzi schemes not the guy that got the pail of shit dumped on his head.

Actually, the people to blame are the Clinton Administration, Barney Frank, and Chris Dodd. Had they never de-regulated the home mortgage industry in the first place, this would have never happened. Selling derivatives was illegal prior to their "restructuring" of the CRA.

Community Reinvestment Act (CRA)

The Community Reinvestment Act (CRA) was a Democratic invention of the Carter Administration and which was strengthened by President Clinton. The purpose of CRA was to make sure banks didn't discriminate--a good idea, in theory, if properly implemented.

But President Clinton, in 1995, pushed to have the evaluation of CRA compliance based not on subjective assessment but based on strict numeric analysis. That meant that, essentially, if a bank wasn't loaning the "right" amount of money to minorities and low-income clients, etc. that they would be found to be in violation--even if the reason minorities weren't receiving the same amount of loans was because they weren't credit-worthy . This obviously lead to the beginning of the sub-prime market as most (if not all) of these CRA-driven loans were not made to prime borrowers that would normally be accepted by Freddie Mac and Fannie Mae. It all began with the first securitization of CRA loans in October 1997 and snowballed from there.

Banks would normally have not been inclined to lend money to uncreditworthy borrowers but the government essentially compelled them to. In the exploding housing market with constantly-increasing house prices it turned out that even these high-risk borrowers were not defaulting because even if they couldn't afford the mortgage they could just sell their home. At a profit. At that point the free market took over. It figured that if these highly-profitable sub-prime securities weren't defaulting, heck, they might as well start getting into the market as well. And it worked fine for a number of years... as long as home prices continued to increase.

The Community Reinvestment Act was an ostensibly noble effort to help the poor in our economy. But despite their presumably good intentions, it should be painfully obvious--especially today--that forcing banks to lend money to people that have bad credit or insufficient income is not a good idea.

 

[DOMS]

A very informative post.

 

[Glycomann]

Actually, the people to blame are the Clinton Administration, Barney Frank, and Chris Dodd. Had they never de-regulated the home mortgage industry in the first place, this would have never happened. Selling derivatives was illegal prior to their "restructuring" of the CRA.

Community Reinvestment Act (CRA)

The Community Reinvestment Act (CRA) was a Democratic invention of the Carter Administration and which was strengthened by President Clinton. The purpose of CRA was to make sure banks didn't discriminate--a good idea, in theory, if properly implemented.

But President Clinton, in 1995, pushed to have the evaluation of CRA compliance based not on subjective assessment but based on strict numeric analysis. That meant that, essentially, if a bank wasn't loaning the "right" amount of money to minorities and low-income clients, etc. that they would be found to be in violation--even if the reason minorities weren't receiving the same amount of loans was because they weren't credit-worthy . This obviously lead to the beginning of the sub-prime market as most (if not all) of these CRA-driven loans were not made to prime borrowers that would normally be accepted by Freddie Mac and Fannie Mae. It all began with the first securitization of CRA loans in October 1997 and snowballed from there.

Banks would normally have not been inclined to lend money to uncreditworthy borrowers but the government essentially compelled them to. In the exploding housing market with constantly-increasing house prices it turned out that even these high-risk borrowers were not defaulting because even if they couldn't afford the mortgage they could just sell their home. At a profit. At that point the free market took over. It figured that if these highly-profitable sub-prime securities weren't defaulting, heck, they might as well start getting into the market as well. And it worked fine for a number of years... as long as home prices continued to increase.

The Community Reinvestment Act was an ostensibly noble effort to help the poor in our economy. But despite their presumably good intentions, it should be painfully obvious--especially today--that forcing banks to lend money to people that have bad credit or insufficient income is not a good idea.

It's all to blame. All sides. There are no angels in the room.

 

[Glycomann]

I stopped right there and didn't read any further. I hate Glenn Beck. And I hate the GOP.

They are no better than the Dems. Well, not by much. They both want to reach into my pocket and take my money for all kinds of social welfare and pork projects.

I hate Sarah Palin. She's a moron and not fit to lead a girl scout troop, let alone a country. I hate Obama, just the same.

I hate Glenn Beck, just as I hate Bill Mahr.

You have my political philosophy fucked up. For me it isn't left or right that makes the difference. True, I despise the Left for their need to try and ban guns, tax me more, and for their repugnant hippy hygene, but I hate the right too. They are no friend of freedom. I have no need for people intruding into others bedrooms, telling them who they can marry, or those who would legislate into law that a woman cannot to abort their fetus. I think abortion is disgusting, but it doesn't affect me in anyway (well, to be fair, it probably saves me some tax dollars... less kids on welfare.)

I want Government to leave me alone. Let me keep the majority of what I earn (minus a nominal percentage for national defense and maintenance of critical infrastructure), and leave everyone else to take care of themselves.

Look... I'm not heartless. I fully believe in charity, and helping your fellow man. But it should be of your own volition, and not forced by government coercion.

we're not so different.

 

[M4A3]

It's all to blame. All sides. There are no angels in the room.

That's not what you said before. You put it on republicans. I see now you want to let the liberals take a little blame, since I called you on your bullshit.

It's a start.

 

[LAM]

Actually, the people to blame are the Clinton Administration, Barney Frank, and Chris Dodd. Had they never de-regulated the home mortgage industry in the first place, this would have never happened. Selling derivatives was illegal prior to their "restructuring" of the CRA.

Community Reinvestment Act (CRA)

there is tons of data out there that shows CRA banks are not the cause of the mortgage meltdown but the non-CRA Wall Street banks, mortgage brokers and mortgage companies.

the banking industry was already made to big to fail thanks to the repeal of the Glass-Steagall and the Commodities Futures Modernization Act which which was slipped in as a rider to the Omnibus Spending bill. the CFMA not only removed derivatives and credit default swaps from the purview of federal oversight, Congress pre-empted the states from enforcing existing gambling and bucket shop laws against Wall Street. Which makes it makes it sound like the sponsors (of course texas republicans) knew it was illegal or at least prosecutable.

 

[AlphaONE]

Man...fuck all these kids....if I don't get a pay check this month....I think I just may be telling my entire CoC to fuck off.

 

[M4A3]

there is tons of data out there that shows CRA banks are not the cause of the mortgage meltdown but the non-CRA Wall Street banks, mortgage brokers and mortgage companies.

Provides some, and maybe I won't think you spreading bullshit. Until then... meh. Make sure to cite your sources please. Moveon.org isn't going to cut it.

 

[LAM]

Provides some, and maybe I won't think you spreading bullshit. Until then... meh. Make sure to cite your sources please. Moveon.org isn't going to cut it.

http://www.traigerlaw.com/publications/traiger_hinckley_llp_cra_foreclosure_study_1-7-08.pdf

UPDATE 2-Lending to poor didn't spur crisis -Fed's Kroszner | Reuters

http://www.nytimes.com/2008/10/18/opinion/18barr.html

Community Reinvestment Act had nothing to do with subprime crisis - BusinessWeek


Wall Street banks and hedge funds are directly responsible for the subprime crisis. they were the non-CRA banks that took the bulk of suprime loans, no doc loans, etc. and bundled them up, sold them and had to assume 0% financial risk while raking in profits.

Bear Sterns was unloading subprime loans to investors in the Cayman Islands as early as 2006. they took investors out of the jurisdiction of the feds and the investors host country. not a single one of them has gone to jail charged with anything and they made 100's of billions. then they bet against the loans and made even more money.

Emails, Wall Street crisis key in Bear Stearns trial | Reuters

Financial Crisis Commission Hearing UPDATES: Bear Stearns, SEC Officials Grilled

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aLBUXL1oXSCM&refer=home

 

[Glycomann]

That's not what you said before. You put it on republicans. I see now you want to let the liberals take a little blame, since I called you on your bullshit.

It's a start.

You need to see both sides. You see no blame in your Party. If you can't or refuse to see more than one side then there is no point to further discussion. At that point it is like arguing with an automaton. If you stop doing cut-and-paste you may start forming your own opinion.

 

[Glycomann]

http://www.traigerlaw.com/publications/traiger_hinckley_llp_cra_foreclosure_study_1-7-08.pdf

UPDATE 2-Lending to poor didn't spur crisis -Fed's Kroszner | Reuters

http://www.nytimes.com/2008/10/18/opinion/18barr.html

Community Reinvestment Act had nothing to do with subprime crisis - BusinessWeek


Wall Street banks and hedge funds are directly responsible for the subprime crisis. they were the non-CRA banks that took the bulk of suprime loans, no doc loans, etc. and bundled them up, sold them and had to assume 0% financial risk while raking in profits.

Bear Sterns was unloading subprime loans to investors in the Cayman Islands as early as 2006. they took investors out of the jurisdiction of the feds and the investors host country. not a single one of them has gone to jail charged with anything and they made 100's of billions. then they bet against the loans and made even more money.

Emails, Wall Street crisis key in Bear Stearns trial | Reuters

Financial Crisis Commission Hearing UPDATES: Bear Stearns, SEC Officials Grilled

Bear Stearns Subprime Funds May Draw U.S. Charges, People Say - Bloomberg

Wait wait... don't muddy the water with facts.

 

[M4A3]

Wait wait... don't muddy the water with facts.

None of that shit comes close to supporting your position with fact. It's all the opinion of people with an agenda. I'll take all that, and proceed to wipe my ass with it. That's all it's good for.

 

[Glycomann]

Actually, the people to blame are the Clinton Administration, Barney Frank, and Chris Dodd. Had they never de-regulated the home mortgage industry in the first place, this would have never happened. Selling derivatives was illegal prior to their "restructuring" of the CRA.

Community Reinvestment Act (CRA)

The Community Reinvestment Act (CRA) was a Democratic invention of the Carter Administration and which was strengthened by President Clinton. The purpose of CRA was to make sure banks didn't discriminate--a good idea, in theory, if properly implemented.

But President Clinton, in 1995, pushed to have the evaluation of CRA compliance based not on subjective assessment but based on strict numeric analysis. That meant that, essentially, if a bank wasn't loaning the "right" amount of money to minorities and low-income clients, etc. that they would be found to be in violation--even if the reason minorities weren't receiving the same amount of loans was because they weren't credit-worthy . This obviously lead to the beginning of the sub-prime market as most (if not all) of these CRA-driven loans were not made to prime borrowers that would normally be accepted by Freddie Mac and Fannie Mae. It all began with the first securitization of CRA loans in October 1997 and snowballed from there.

Banks would normally have not been inclined to lend money to uncreditworthy borrowers but the government essentially compelled them to. In the exploding housing market with constantly-increasing house prices it turned out that even these high-risk borrowers were not defaulting because even if they couldn't afford the mortgage they could just sell their home. At a profit. At that point the free market took over. It figured that if these highly-profitable sub-prime securities weren't defaulting, heck, they might as well start getting into the market as well. And it worked fine for a number of years... as long as home prices continued to increase.

The Community Reinvestment Act was an ostensibly noble effort to help the poor in our economy. But despite their presumably good intentions, it should be painfully obvious--especially today--that forcing banks to lend money to people that have bad credit or insufficient income is not a good idea.

The CRA probably played a significant role but you should know that GW Bush was a proponent of the CRA. See 2002 speach http://dealbreaker.com/2008/01/it-didnt-start-with-countrywid.php.

You also fail to address the effect the Gramm Leach repeal of the Glass???Steagall Act, which dropped barriers between commercial and investment banks thus the creation of and great expansion of these credit default swaps and the like. This is what drove this Ponzi scheme. You fail to address any of these facts.

Blaming the poor for the Great Recession 2008 is typical of right wing crazies.

 

[Glycomann]

None of shit comes close to supporting your position with fact. It's all the opinion of people with an agenda. I'll take all that, and proceed to wipe my ass with it. That's all it's good for.

You seem to feel you can dismiss facts by fiat with a phrase like 'I'll take all that, and proceed to wipe my ass with it.' Apparently you have no skills to challenge arguments or what is put before you as fact. You should be able to take apart an argument point by point. There have been a number of arguments placed before you yet you fail to address any. I contend that the repeal of Glass - Steagall was the major contributor to the 2008 collapse. I challenge you to refute my claim. LAM placed several more before you. I challenge you to drop your rhetoric and address these facts as well. It matters not who has put them forth even if you believe those persons had an agenda. If you are intellectually honest you should at least address them as arguments if your intent, which it should be in your position, is to dispute them as fact. If you can't do this then you are only putting forth rhetoric and senseless banter, both of which are a waste of time.

 

[M4A3]

I contend that the repeal of Glass - Steagall was the major contributor to the 2008 collapse.

It was repealed in 1999 under the Clinton Administration, and by a bi-partisan vote in the house.

So, your whole point is moot. I said it was the Clinton Administration that was responsible due to the CRA. The repeal of the Glass - Steagall just makes them even more responsible.

Clinton had the ability to veto the repeal if he wanted to. He didn't, and signed it into law.

It's obvious that it was a combination of both these actions taken by the Clinton Administration that led to the crisis.

Forcing banks to lend to unqualified buyers was the fuel that got the fire started (the CRA). Allowing the selling of derivatives sustained that fire, and caused it rage out of control.

And again, it all happened under a Democratic Administration.

So, what was your point again?

 

[Glycomann]

It was repealed in 1999 under the Clinton Administration, and by a bi-partisan vote in the house.

So, your whole point is moot. I said it was the Clinton Administration that was responsible due to the CRA. The repeal of the Glass - Steagall just makes them even more responsible.

Clinton had the ability to veto the repeal if he wanted to. He didn't, and signed it into law.

It's obvious that it was a combination of both these actions taken by the Clinton Administration that led to the crisis.

Forcing banks to lend to unqualified buyers was the fuel that got the fire started (the CRA). Allowing the selling of derivatives sustained that fire, and caused it rage out of control.

And again, it all happened under a Democratic Administration.

So, what was your point again?

The house vote was Republicans 205–16; Democrats 138–69. Certainly more Dems were against than Republicans. You fail to mention that the sponsoring congressmen, Sen. Phil Gramm (R, Texas), Rep. Jim Leach (R, Iowa) and Thomas J. Bliley, Jr. (R, Virginia), were all republicans and also that it passed on partisan vote in the Senate (53 Republicans and one Democrat in favor; 44 Democrats opposed). Gramm now has a nice cushy Vice Chairmanship in the Investment Bank division of USB, obviously a payoff. Leach is at the Council on Foreign Relations and we all know what they do. Clinton was no saint and certainly a Globalist but you should look at the riders on that bill to explain why Clinton voted for it. Again you only present part of your case. You have a view of the Republican rats that canonizes them for sainthood. Read a little deeper before Beatifying your idols.

About 40% of home mortgages are through your demonized Freddie and Fannie. You would kill that and expect few or no consequences. That Frank and co opened up the language to allow more lower income participants was well intentioned but predatory loan practices by banks to pressure them into poorly structured instruments so they could be bundled and sold off in CDS is what fueled the collapse. Those CDSs estimates valued at 20-50 times the value of those mortgages, a complete Ponzi scheme that collapsed with the shifting interest rates and bloated home values. You should also admit that GW Bush supported CRA. He called for an "ownership society".

 

[LAM]

Blaming the poor for the Great Recession 2008 is typical of right wing crazies.

U.S. Subprime Mortgage Crisis: Policy Reactions
http://www.jovenesporcr.com/storage/Subprime crisis_708036.pdf

they tried blaming the sub-prime crisis on the poor but that myth has been debunked so many times by so many reports none of them blaming CRA banks but all of them putting it on the unregulated wall street banks. conservatives always blame the poor, the people that have the least amount of wealth, thus the least amount of power...

conservatives forget that being poor is simply an economic status and not a "type" of person.

 

[LAM]

Clinton was no saint and certainly a Globalist but you should look at the riders on that bill to explain why Clinton voted for it.

riders on bills is the #1 sneaky way to get things done

 

[LAM]

Blaming the poor for the Great Recession 2008 is typical of right wing crazies.

conservatives blame the poor for not becoming middle class. who's fault is that the middle class conservative did not become wealthy? are they both not failures in capitalism?

 

[LAM]

The house vote was Republicans 205???16; Democrats 138???69. Certainly more Dems were against than Republicans. You fail to mention that the sponsoring congressmen, Sen. Phil Gramm (R, Texas), Rep. Jim Leach (R, Iowa) and Thomas J. Bliley, Jr. (R, Virginia), were all republicans and also that it passed on partisan vote in the Senate (53 Republicans and one Democrat in favor; 44 Democrats opposed). Gramm now has a nice cushy Vice Chairmanship in the Investment Bank division of USB, obviously a payoff. Leach is at the Council on Foreign Relations and we all know what they do. Clinton was no saint and certainly a Globalist but you should look at the riders on that bill to explain why Clinton voted for it. Again you only present part of your case. You have a view of the Republican rats that canonizes them for sainthood. Read a little deeper before Beatifying your idols.

About 40% of home mortgages are through your demonized Freddie and Fannie. You would kill that and expect few or no consequences. That Frank and co opened up the language to allow more lower income participants was well intentioned but predatory loan practices by banks to pressure them into poorly structured instruments so they could be bundled and sold off in CDS is what fueled the collapse. Those CDSs estimates valued at 20-50 times the value of those mortgages, a complete Ponzi scheme that collapsed with the shifting interest rates and bloated home values. You should also admit that GW Bush supported CRA. He called for an "ownership society".

also let's not forget:

in 2002 the Bush Administration released its "Blueprint for the American Dream" (an ambitious plan to increase minority homeownership by 5.5 million families) which included $200 million to help 40,000 low-income families make downpayments to become homeowners annually through 2010. The loans were administered through Fannie and Freddie.

But low-income buyers were still having problems with credit - until 2004 - when the Office of the Currency Comptroller, an obscure regulatory agency tasked with ensuring the fiscal soundness of America's banks, invoked an 1863 law to give itself the power to override state laws governing mortgage lending. The OCC told states they could not enforce state mortgage-lending laws, and all banks would be subject only to less-strict federal laws. The Bush White House claimed that banks should ???only be subject to federal laws regulating mortgage credit.??? This allowed banks to issue "no-doc" and "low-doc" loans without verification creating a substantial additional capital pool for the derivatives market (no-doc sub-prime and subsidized sub-prime mortgages). Research from UNC-Chapel Hill's Center for Community Capital shows that those lending laws had actually worked. States that had stricter regulations on issuing mortgages were found to have fewer foreclosures.

 

[Glycomann]

also let's not forget:

in 2002 the Bush Administration released its "Blueprint for the American Dream" (an ambitious plan to increase minority homeownership by 5.5 million families) which included $200 million to help 40,000 low-income families make downpayments to become homeowners annually through 2010. The loans were administered through Fannie and Freddie.

But low-income buyers were still having problems with credit - until 2004 - when the Office of the Currency Comptroller, an obscure regulatory agency tasked with ensuring the fiscal soundness of America's banks, invoked an 1863 law to give itself the power to override state laws governing mortgage lending. The OCC told states they could not enforce state mortgage-lending laws, and all banks would be subject only to less-strict federal laws. The Bush White House claimed that banks should ???only be subject to federal laws regulating mortgage credit.??? This allowed banks to issue "no-doc" and "low-doc" loans without verification creating a substantial additional capital pool for the derivatives market (no-doc sub-prime and subsidized sub-prime mortgages). Research from UNC-Chapel Hill's Center for Community Capital shows that those lending laws had actually worked. States that had stricter regulations on issuing mortgages were found to have fewer foreclosures.

Thanks for reminding me. But can't we still blame it all on the Democrats? Jeez those facts seem to always get in the way.