White House philosophy stoked mortgage bonfire

Who do you blame for the mortgage mess?

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#1
W

WA_Vol

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#1
Eight years after arriving in Washington vowing to spread the dream of homeownership, Bush is leaving office, as he himself said recently, "faced with the prospect of a global meltdown" with roots in the housing sector he so ardently championed.

From his earliest days in office, Bush paired his belief that Americans do best when they own their own home with his conviction that markets do best when let alone.

He pushed hard to expand homeownership, especially among minorities, an initiative that dovetailed with his ambition to expand the Republican tent — and with the business interests of some of his biggest donors. But his housing policies and hands-off approach to regulation encouraged lax lending standards.

"The Bush administration took a lot of pride that homeownership had reached historic highs," Snow said in an interview. "But what we forgot in the process was that it has to be done in the context of people being able to afford their house. We now realize there was a high cost."
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White House philosophy stoked mortgage bonfire - International Herald Tribune
 
#2
#2
of course an offshoot of the New York Times is going to stop historical perspective after 8 years.

I'm not saying that Bush policy didn't help exacerbate the problem, but at least he is on record for seeking to slow down Fannie/Freddie's actions.

The real criminals in this story are Barney Frank and Chris Dodd.
 
#4
#4
MG1968 said:
of course an offshoot of the New York Times is going to stop historical perspective after 8 years.

I'm not saying that Bush policy didn't help exacerbate the problem, but at least he is on record for seeking to slow down Fannie/Freddie's actions.

The real criminals in this story are Barney Frank and Chris Dodd.
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Spot on. Frank and Dodd are the main ones to blame for this mess.
 
#6
#6
Is anyone going to place blame and responsibility on the individuals who bit off more than they could chew???
 
#7
#7
therealUT said:
Is anyone going to place blame and responsibility on the individuals who bit off more than they could chew???
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U think individuals should be responsible? Come on, this is the new United Socialist of America. Pass the buck, tax the rich, and blame everything on something other than yourself. If PC hasn't totally killed real debate about any serious issue, then why should we worry about our posterity paying for this huge debt? :crazy:
 
#8
#8
Trying to link this debacle to one man or even one administration is oversimplify the issue. Bush had little to do with this, the CRA also is unfairly blamed. Look up stream -- it's all about profits.
 
#9
#9
which one of the clowns in congress was quoted saying that giving restrictions on fannie and freddie was like "performing open heart sugery on someone that has a cold". that clown drove me nuts
 
#11
#11
where is lawgator? I expected him to ride to the defense of the New York Times?
 
#12
#12
MG1968 said:
of course an offshoot of the New York Times is going to stop historical perspective after 8 years.

I'm not saying that Bush policy didn't help exacerbate the problem, but at least he is on record for seeking to slow down Fannie/Freddie's actions.

The real criminals in this story are Barney Frank and Chris Dodd.
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Meaning they created this crisis?
 
#13
#13
VolByBirth said:
Meaning they created this crisis?
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No but they sure did deny anything was wrong and block any attempt to rectify the situation by calling those who were seeking to get to the bottom of it racist, or at least implying it.
 
#15
#15
MG1968 said:
where is lawgator? I expected him to ride to the defense of the New York Times?
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My opinion is that the mortgage mess is the result of a confluence of factors, including, but not limited to, fraud by individual mortgage bankers and agents, fraud by individual home buyers, fraud by institutions that repackaged the loans and sold the paper as investment, too rapid expansion of the Fannie Mae and Freddie Mac vehicles, too lax regulation, very bad perverse incentives tied to the reselling structure for salaries and bonusing of the investment brokers who went out and bought the mortgage-backed securities, an otherwise weak economy where investing in either housing or housing securities seemed like the only way to keep up with the Joneses.

In the end, it was All-American greed that did this, whether it be an individual borrower who borrowed at a ridiculously low temporary rate planning to resell quickly, or the greed of mortgage brokers who pushed paper they knew was bad, or the banks that underworte them because the people making the decisions got bonused based on volume of loans.

Its happened before. It will happen again.
 
#16
#16
lawgator1 said:
My opinion is that the mortgage mess is the result of a confluence of factors, including, but not limited to, fraud by individual mortgage bankers and agents, fraud by individual home buyers, fraud by institutions that repackaged the loans and sold the paper as investment, too rapid expansion of the Fannie Mae and Freddie Mac vehicles, too lax regulation, very bad perverse incentives tied to the reselling structure for salaries and bonusing of the investment brokers who went out and bought the mortgage-backed securities, an otherwise weak economy where investing in either housing or housing securities seemed like the only way to keep up with the Joneses.

In the end, it was All-American greed that did this, whether it be an individual borrower who borrowed at a ridiculously low temporary rate planning to resell quickly, or the greed of mortgage brokers who pushed paper they knew was bad, or the banks that underworte them because the people making the decisions got bonused based on volume of loans.

Its happened before. It will happen again.
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This is wrong on about 47 fronts, but I'm not going through it on my handheld.
 
#17
#17
therealUT said:
Is anyone going to place blame and responsibility on the individuals who bit off more than they could chew???
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Not nearly enough blame has been placed on the consumer, and it fits well with the "victim" roles people willing accpet these days. That will eventually cripple our society (if it hasn't already done irrepairable damage).

Can't read: it isn't your fault
Not an athlete: we will stop keeping score
Can't pay your mortage: it is all the bank's fault

lawgator1 said:
My opinion is that the mortgage mess is the result of a confluence of factors, including, but not limited to, fraud by individual mortgage bankers and agents, fraud by individual home buyers, fraud by institutions that repackaged the loans and sold the paper as investment, too rapid expansion of the Fannie Mae and Freddie Mac vehicles, too lax regulation, very bad perverse incentives tied to the reselling structure for salaries and bonusing of the investment brokers who went out and bought the mortgage-backed securities, an otherwise weak economy where investing in either housing or housing securities seemed like the only way to keep up with the Joneses.

In the end, it was All-American greed that did this, whether it be an individual borrower who borrowed at a ridiculously low temporary rate planning to resell quickly, or the greed of mortgage brokers who pushed paper they knew was bad, or the banks that underworte them because the people making the decisions got bonused based on volume of loans.

Its happened before. It will happen again.
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Everyone should have some personal responsibility.
 
#18
#18
lawgator1 said:
My opinion is that the mortgage mess is the result of a confluence of factors, including, but not limited to, fraud by individual mortgage bankers and agents, fraud by individual home buyers, fraud by institutions that repackaged the loans and sold the paper as investment, too rapid expansion of the Fannie Mae and Freddie Mac vehicles, too lax regulation, very bad perverse incentives tied to the reselling structure for salaries and bonusing of the investment brokers who went out and bought the mortgage-backed securities, an otherwise weak economy where investing in either housing or housing securities seemed like the only way to keep up with the Joneses.

In the end, it was All-American greed that did this, whether it be an individual borrower who borrowed at a ridiculously low temporary rate planning to resell quickly, or the greed of mortgage brokers who pushed paper they knew was bad, or the banks that underworte them because the people making the decisions got bonused based on volume of loans.

Its happened before. It will happen again.
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I would expect a lawyer to refrain from throwing the term "fraud" around so loosely.
 
#19
#19
therealUT said:
I would expect a lawyer to refrain from throwing the term "fraud" around so loosely.
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Why? If people who applied lied about income or assets to qualify, or if the brokers told people to lie or passed on applications they knew were false, why isnt that fraud?
 
#20
#20
If Bush is not at fault, then why did he fire the head of the Federal Housing Oversight for writing a report warning Fannie and Freddie could collapse? From the same article:
'We told you so'
Armando Falcon Jr. was preparing to take on a couple of giants.
A soft-spoken Texan, Falcon ran the Office of Federal Housing Enterprise Oversight, a tiny government agency that oversaw Fannie Mae and Freddie Mac, two pillars of the American housing industry. In February 2003, he was finishing a blockbuster report that warned the pillars could crumble.

Falcon's report outlined a worst-case situation in which Fannie and Freddie could default on debt, setting off "contagious illiquidity in the market" — in other words, a financial meltdown. He also raised red flags about the companies' soaring use of derivatives, the complex financial instruments that economic experts now blame for spreading the housing collapse.

Today, the White House cites that report — and its subsequent effort to better regulate Fannie and Freddie — as evidence that it foresaw the crisis and tried to avert it. Bush officials recently wrote up a talking points memo headlined "GSE's — We Told You So."
But the back story is more complicated. To begin with, on the day Falcon issued his report, the White House tried to fire him.

So when Falcon refused to deep-six his report, Raines took his complaints to top Treasury officials and the White House. "I'm going to do what I need to do to defend my company and my position," Raines told Falcon.

Days later, as Falcon was in New York preparing to deliver a speech about his findings, his cellphone rang. It was the White House personnel office, he said, telling him he was about to be unemployed.

His warnings were buried in the next day's news coverage, trumped by the White House announcement that Bush would replace Falcon, a Democrat appointed by Bill Clinton, with Mark Brickell, a leader in the derivatives industry that Falcon's report had flagged.
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#22
#22
oklavol said:
If Bush is not at fault, then why did he fire the head of the Federal Housing Oversight for writing a report warning Fannie and Freddie could collapse? From the same article:
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oop, you got us there. we can forget about everything that happened during the Carter administration and later on in the Clinton administration.

btw, it would be nice if you linked to the article you're quoting.
 
#23
#23
oklavol said:
If Bush is not at fault, then why did he fire the head of the Federal Housing Oversight for writing a report warning Fannie and Freddie could collapse? From the same article:
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Here's another report showing that the Bush admin recognized a threat and tried to increase regulation but those efforts were blocked by Congress (Dems).

YouTube - Timeline shows Bush, McCain warning Dems of financial mess

I'm not saying Bush is with out fault but to leave Congress, Freddie and Fannie, the Fed, consumers and lenders out is missing a big part of the story.
 
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#24
#24
MG1968 said:
oop, you got us there. we can forget about everything that happened during the Carter administration and later on in the Clinton administration.

btw, it would be nice if you linked to the article you're quoting.
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It is linked in the first post in this thread.

You think the housing market when Carter was President in the late 70's affected the housing market in 2008? :lol: that's pretty funny.
 
#25
#25
oklavol said:
It is linked in the first post in this thread.

You think the housing market when Carter was President in the late 70's affected the housing market in 2008? :lol: that's pretty funny.
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Community Reinvestment Act

btw, the NYT article linked to in the first post is a fraudulent piece of revisionist history.
 
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