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Thread: U.S. sues S&P over subprime ratings

  1. #181
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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by finebead View Post
    I have said the dems were not helpful.
    How very very true that is, and you'll grow to realize just how unhelpful there were over the next few years.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by finebead View Post
    I have said the dems were not helpful. The repubs were driving the bus, and I have shown the stupid things the repubs did, which the right seems to conveniently ignore and try to blame the whole thing on Clinton and CRA, which is wrong.
    I would rephrase that too; the democrats built the bus, fueled it, started driving it, the republicans were at the wheel when it crashed. They both had their foot on the gas.
    We went from sticks and stones may break my bones but words will never hurt me to safe spaces.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Blue_State View Post
    The committee wouldn’t let anything out to correct the problem. In February 2004, the Office of the Comptroller of the Currency (OCC) tried to strengthen its GSE oversight. It was fought off by democrats, and dare I say it, ACORN.



    He wanted to see more lending to minorities. Did he say he wanted subprime lending in 2002? No.
    This mess was made by republicans and democrats. Barney Frank, Clinton, Carter and Bush all had a hand. To lay the entire mess on Bush is ridiculous, especially when they were asking for clarity on the Freddie and Fannie books.
    The "commitee" was controlled by Republicans not Acorn. And the COC was used by Bush to stop the States from using their own laws to regulate the predatory mortgages, allowing the Commercial banks free reign. Bush did everything in his power to keep the bubble rolling.
    Eliot Spitzer - Predatory Lenders' Partner in Crime

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by iguanaman View Post
    The "commitee" was controlled by Republicans not Acorn. And the COC was used by Bush to stop the States from using their own laws to regulate the predatory mortgages, allowing the Commercial banks free reign. Bush did everything in his power to keep the bubble rolling.
    Eliot Spitzer - Predatory Lenders' Partner in Crime
    ACORN funded congressmen to not move forward on the GSE gaining oversight on Fannie and Freddie.
    We went from sticks and stones may break my bones but words will never hurt me to safe spaces.

  5. #185
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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by iguanaman View Post
    The "commitee" was controlled by Republicans not Acorn. And the COC was used by Bush to stop the States from using their own laws to regulate the predatory mortgages, allowing the Commercial banks free reign. Bush did everything in his power to keep the bubble rolling.
    Eliot Spitzer - Predatory Lenders' Partner in Crime
    I just finished reading the link you posted. Help me to understand how the OCC use of the NBA allowed for predatory mortgages? I could be missing something but everything I read is in relation to credit cards. The OCC used their power to work with credit cards, not mortgages.

    http://www.phil.frb.org/consumer-cre...Act_032004.pdf
    We went from sticks and stones may break my bones but words will never hurt me to safe spaces.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Fenton View Post
    "The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (the GSE Act) and HUD’s 1995 National Homeownership Strategy launched a classic race to the bottom based on credit flexibilities. HUD assured broad compliance by drafting virtually the entire mortgage industry. Most significant was the policy to largely eliminate downpayments for targeted borrowers. As the government demanded more and more such lending, particularly those with incomes below 80 percent of median and special target groups, virtually the entire industry responded by moving further and further down the demand curve and out the risk curve. FHA, Fannie, Freddie, banks, subprime lenders, Alt-A lenders, first-time buyers, repeat buyers, and cash-out refinance borrowers all became much more highly leveraged. Moral hazard became rampant as downpayments and initial equity disappeared throughout much of the housing finance system. "
    1. That's an opinion.

    2. What is the source?

    3. It doesn't mention the CRA (which passed in 1977), and doesn't blame it for the mortgage defaults.

    By the way, I agree it is bad policy to put people into houses that they can't afford. My point is that the CRA, which attempted to prevent redlining and racial discrimination did not force lenders to lower lending standards.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Fenton View Post
    LOL !!! A law firm that "councils" banks on CRA compliance ?

    Why not just post a link to MSNBC or some other Lib site that ignorantly blames Bush for a crisis that took the Govt 13 years to complete. OBJECTIVE evidence would be great.

    Look up HUD's 1995 Home Ownership Strategy, or hell, here's a statement from HUD in 2010...
    HUD in 2010:

    … the sharp rise in mortgage delinquencies and foreclosures is fundamentally the result of rapid growth in loans with a high risk of default—due both to the terms of these loans and to loosening underwriting controls and standards. Mortgage industry participants appear to have been drawn to encourage borrowers to take on these riskier loans due to the high profits associated with originating these loans and packaging them for sale to investors. While systematic information on borrowers’ motivations in obtaining these loans is not available, existing evidence suggests that some borrowers did not understand the true costs and risks of these loans while others were willing to take on these risks to tap accumulated home equity or to obtain larger homes.


    Loose underwriting standards ?? Who has that kind of regulatory power ? To systematically lower standards for lending institutions ? For GSE's purchases ? Goldman Sachs ? Wells Fargo ?

    Nope, as it turns out certain Govt agencies were given regulatory power in the early and mid 90s that had catastrophic effects on our housing market. All of your rhetoric aside, you have to ask yourself, how long are you going to let your love for a bankrupt ideology, for a failing President distort your ability to be objective ?
    Again, no mention of the CRA forcing banks to provide loans to unqualified borrowers. In fact, that statement doesn't even say that government regulations were at fault, instead it says: Mortgage industry participants appear to have been drawn to encourage borrowers to take on these riskier loans due to the high profits associated with originating these loans and packaging them for sale to investors. "[P]ackaging them for sale to investors" is referring to the derivatives, which most unbiased analysts say were a major factor in the mortgage crisis.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Blue_State View Post
    ACORN funded congressmen to not move forward on the GSE gaining oversight on Fannie and Freddie.
    And Fannie and Freddie did not have anything to do with predatory lending nor the bubble.....
    PeteEU

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by OpportunityCost View Post
    Ok. Since the logic seems to escaping you.

    Bank in an area is not lending much money because the area is high risk via their lending standards. CRA comes along in the 90s and informs the bank that they HAVE to lend money in their area of they wish to maintain prime lending rates, expand, aquire another bank or merge with another bank. Further, area community groups would be consulted to see what sort of lending practices occur in the local area.

    Bank starts lending in the local area.

    Why do you think that is?

    Lets take it one step past the bank. Once the loan occurs and a bunch of others, the bank bundles those mortgages out with a rating, which they insure against default and also possibly sell portions of the risk and profit--bundling and CDSs. FnF at some point or another will aquire a portion of the risk, if not outright ownership because they own a significant portion of the home lending market by 2007, just under HALF.

    A bank seeing that the government is taking up the risk is going to do what? A bank that is being telegraphed that lending standards are of no consequence so long as their CRA compliance is solid---further that they will recieve rosy reports from inspectors for more funds, aquisitions ratings, etc---all the while their CAMELS rating was dropping. Im not providing you with proof, Im asking that you use your brain and follow the steps of what occurred.
    1. The CRA passed in 1977. No major problems seen until the deregulation during the Bush II years.

    2. If the banks have the documentation that shows that they had unbiased lending standards and applied them without discriminating on the basis of race, gender etc and did not redline (discriminate against certain neighborhoods) they would be fully in compliance with the CRA.

    3. I'm not going to defend all of the regulatory changes and deregulation that happened in the 90s and after, my point is to show that blaming the CRA is factually incorrect.

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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by PeteEU View Post
    And Fannie and Freddie did not have anything to do with predatory lending nor the bubble.....
    Pete, I will give you the same reasoning you gave me in another thread.

    Meh.
    We went from sticks and stones may break my bones but words will never hurt me to safe spaces.

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