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Like the current situation has anything to do with Obama... Apparently you've forgotten who got us into this mess over the last 8 years. Let me guess... bet you voted Republican... the folks with no plan, no vision, just more of the same.
Oh, and this is just precious: "He's a genius, but someone forgot to tell Wall Street." Like we should put our trust in whatever Wall Steet believes...
Dude, do what Wall Street wants and you are doomed... can't you feel the love they've been throwing your way.. LOL
musketee, you don't seem to have a clue as to what happened to the banks, Acorn's involvement, or Obama's, Dodd's, and Franks. Want to know why the market is tanking? Other's stay more informed than you do.
Obama Sued Citibank Under CRA to Force it to Make Bad Loans
Thanks for setting me straight. I guess you are right:
being retired and living off my investments for the last 6 years just does not qualify me to opine on the state of the nation, the economy and the markets. So, I defer to your far greater wisdom, except:
ilap: Macro-economics-101 (maybe you slept though that) suggests that if aggregate demand is in steep
decline due to spending cut by businesses and consumers, it's a good idea to have the government step in with some spending to pick up the slack. This is the lesson of the Great Depression and it's aftermath. This is the policy
of virtually every government in the world that has the tools to deal with this crisis. But maybe they should all be listening to highly qualified geniuses like you instead... and do nothing.
btpt: You hurt my feelings (and demonstrated your own ignorant lack of manners)because the one thing I am not is clueless. I see that you get your news and analysis
from FOX and mediacircus.com... so much for "fair and balanced". If you really want to understand the crisis (as distinct from bad lending practices and the real estate bubble)you shoud read this which discusses how AIG took on
the toxic risks of certain exotic securities with no regard for the systemic risks that were being created --- while republican regulators looked the other way.
Both of you: ideologies are like markets... they run cyclically. A decade of "hands-off-the-markets-republicanism" did extensive damage to our economic system,
our standing in world affairs, and our legitimacy as the world's super-power. We NEED the cycle to come around. We NEED government spending. We NEED new ideas, new leadership, a new financial regulatory framework, a better healthcare system, a better safety net for people fallen on bad times...
If you can't see that, nothing I say will change your mind. So you can go on advocating "do nothing" and blaming the party that's been out of power for the better part of a decade... or you can wake up and get with the program.
What a crock... ACORN is just the new Republican buzz word (Gays, Guns, God, and ACORN).
CRA Myth and Fact
Myth: The Community Reinvestment Act (CRA) caused the foreclosure crisis.
The majority of subprime loans were originated by non-CRA covered financial institutions. In fact, only about 25 percent of sub-prime loans were made by institutions covered by CRA.¹
CRA was passed in 1977. The explosive growth in subprime lending occurred more than two decades later, nearly doubling from 2001-2006 alone. No major changes to CRA were enacted during this time.
CRA does not mandate banks to make only home loans. Banks are encouraged to examine credit needs and lend appropriately based on these needs (for small business, home, and other types of loans).
CRA penalizes banks for reckless, irresponsible and otherwise predatory lending.
Myth: Rapid growth of subprime loans was a direct response to financial institutions efforts to expand homeownership for low and moderate and minority households.
Between 1998-2006 over half of subprime mortgage originations were for refinancing.²
In that same time, less than 10% of subprime mortgage originations went to first time homebuyers.³
Significant gains in homeownership occurred in the 1990s when prime lending was offered to low and moderate income and minority borrowers.
Myth: Federal banking agencies encouraged banks to engage in risky lending practices. In particular, a 1992 Boston Federal Reserve Bank publication, Closing the Credit Gap: A Guide to Equal Opportunity Lending, provided unsound advice to banks.
Federal Reserve Guidance: Lack of credit history should not be seen as a negative factor for potential homebuyers.
Justification: Willingness to pay debt promptly can be determined through alternative sources of information including timely rent, utility bills, and other scheduled payments.
Foreclosure Reality: Foreclosures are not a result of alternative credit scoring, but rather the product of excessive interest rates and unearned fees making loans unaffordable.
Federal Reserve Guidance: Valid income sources may include social security, second jobs, and other sources.
Justification: Many low to moderate-income households have varying sources but consistent or rising levels income throughout the year.
Foreclosure Reality: Subprime loans are not failing as a result of the use of alternative sources of income. Rather, problematic subprime loans are characterized by a lack of income verification, not source of income.