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

  1. #31
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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Napoleon View Post
    It is worth noting that 80% of sub-prime
    loans were issued by institutions which did not fall under the jurisdiction of the CRA. In other words, they deliberately sought out high-risk clientele of their own free will. Back then, the risk wasn't that great; a financial institution could easily wind up making a profit from a foreclosure. But then the Real Estate bubble burst, home values depreciated, and they were saddled with foreclosed properties no one wanted to buy.
    Wrong, by the end of 2008 the GSEs originations of sub-prime paper was 45% and it was under Clinton that securitization of CRA loans was authorized.

    Securitization so the GSEs could bundle bad loans with good ones and sell them to investment banks to finance the secondary market.

    By 2004 92% of the GSEs total loans were ARMs.

    The CRA forced banks to offer access to their loans to the surrounding community or face huge fines.

    Again, why do you think Holder went after Wells Fargo just recently ?

    And why all of the sudden have banks been allowed to stop giving access to easy credit? To STOP allowing their surrounding community members to scream discrimination ?

    You actually think banks wanted to fail ?

    They didn't and some refused to lower their standards and are now being fined by Obamas justice Dept.

    I guess redlining is OK now and the CRA enforcement tool is now history.

    Imagine, this started from bogus screams of racism from the likes of Jesee Jackson and orginizations like ACORN, who recieved billions out of this scam.

    Get the facts before launching with your ignorance.

    The Democrats know their average consituent is as dumb as a box of rocks and thanks to public education they're adding to their voter pool every day by cranking out an endless supply of idiots.

    People that haven't the slightest of what their party did to this nation.

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

    Obama never fails to demonstrate just how much of a power hungry psychopath he has turned into. Trying to sue the S&P 500 for lowering the US's credit rating? It's like trying to sue a movie critic for giving your movie a bad review.

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

    Quote Originally Posted by Voltaire X View Post
    Obama never fails to demonstrate just how much of a
    power hungry psychopath he has turned into. Trying to sue the S&P 500 for lowering the US's credit rating? It's like trying to sue a movie critic for giving your movie a bad review.
    Its akin to a food critic showing up at your resteraunt, but the day before you send a few thugs to explain to him that a bad critique could be harmful to his health.

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

    Quote Originally Posted by Fenton View Post
    Get the facts before launching with your ignorance.
    I work in the financial industry so you picked the wrong member to tango with on this issue. 80% of subprime mortgage loans were issued by private firms over which the CRA had zero jurisdiction. They were not legally required to issue those loans but they did it anyway because they were profitable so long as home prices continued to appreciate. Back then, these institutions would profit whether the loan went into default or not because the value of the home appreciated above the cost of the original loan. So, make sure you know what you're talking about before running your mouth and accusing others of being ignorant.
    Last edited by Napoleon; 02-07-13 at 07:18 PM.

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

    Quote Originally Posted by Rocketman View Post
    It is true, CRA forced many bankers to lend money to people that normally would have been turned away.
    The CRA prohibited discrimination based on race and neighborhood (redlining). It did not require giving loans to people who were not qualified. It was passed in 1977. It was not until the housing bubble burst in the last decade that there was a problem with widespread defaults. The problem was largely caused by lack of regulation/enforcement of derivatives and the ridiculous notion that housing prices would never drop.

    By the way, racial discrimination in housing was/is very real. Ask an African American who tried to buy property before the CRA.

    Wells Fargo Will Settle Mortgage Bias Charges
    By CHARLIE SAVAGE
    Published: July 12, 2012

    WASHINGTON — Wells Fargo, the nation’s largest home mortgage lender, has agreed to pay at least $175 million to settle accusations that its independent brokers discriminated against black and Hispanic borrowers during the housing boom, the Justice Department announced on Thursday. If approved by a federal judge, it would be the second-largest residential fair-lending settlement in the department’s history.

    An investigation by the department’s civil rights division found that mortgage brokers working with Wells Fargo had charged higher fees and rates to more than 30,000 minority borrowers across the country than they had to white borrowers who posed the same credit risk, according to a complaint filed on Thursday along with the proposed settlement.
    http://www.nytimes.com/2012/07/13/bu...rges.html?_r=0
    Last edited by Hard Truth; 02-07-13 at 08:08 PM.

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

    Quote Originally Posted by Napoleon View Post
    I work in the financial industry so you picked the wrong member to tango with on this issue. 80% of subprime mortgage loans were issued by private firms over which the CRA had zero jurisdiction. They were not legally required to issue those loans but they did it anyway because they were profitable so long as home prices continued to appreciate. Back then, these institutions would profit whether the loan went into default or not because the value of the home appreciated above the cost of the original loan. So, make sure you know what you're talking about before running your mouth and accusing others of being ignorant.

    You work for the financial industry and your'e completely unaware of Govt's imposing of "affordable housing requirements " on the GSE's in 1992 ?

    It was 30% by the way or at least that's where it started when HUD was given the authority to administer these quotas which climbed up to 50% in the Clinton era. That's 50% of the GSEs total origination's had to be to people at or below the median income level in their communities.

    Your'e in the "financial industry " but are unaware that the securitizing of those sub prime loans was allowed by the Clinton administration and your'e "ignorant" of the fact that by 2008 there were 27 million sub-prime or low quality loans in the US financial system and of these over 70% ( 19 million or so ) were on the books of Government agencies like the GSE's and 60% of those ( about 12 million) were held by Fannie and Freddie.

    So much for your 80% number you pulled out of thin air. But your'e in the "financial industry".....

    Your'e in the "financial industry" but don't know about the CRA regulations in 1995 forced banks to "demonstrate" that they were making access to loans to people in the banks "community" and the enforcers of these regulations, the regulators themselves were co-opted into accepting lower and lower lending standards.

    Your'e in the "financial industry" but are ignorant of the fact that between 1995 and 2005 private traditional SUB-PRIME lenders like Country Wide were responsible for about 5% of total sub-prime loans and by the 2000's Fannie and Freddie were offering low quality loans at no money down.

    Barney Franks own words in 2010 on the Larry Kudrow show.... "I hope by next year we'll have abolished Fannie and Freddie ... it was a great mistake to push lower-income people into housing they couldn't afford and couldn't really handle once they had it."

    I know exactly who I'm "tangoing" with. Financial industry or not your'e poorly educated to the fundamental cause of the 2008 sub-prime collapse and are most likely just another Lib trying to mitigate the extensive damage of your parties policies.

    Libs lie, the obfuscate, they do stupid things like "blame Bush". I'm not one or one of their low information voters and it's going to take more than your numbers you've pulled out of thin air to convince me you know what your'e talking about.
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    Re: U.S. sues S&P over subprime ratings

    Quote Originally Posted by Hard Truth View Post
    The CRA prohibited discrimination based on race and neighborhood (redlining). It did not require giving loans to people who were not qualified. It was passed in 1977. It was not until the housing bubble burst in the last decade that there was a problem with widespread defaults. The problem was largely caused by lack of regulation/enforcement of derivatives and the ridiculous notion that housing prices would never drop.

    By the way, racial discrimination in housing was/is very real. Ask an African American who tried to buy property before the CRA.

    Wells Fargo Will Settle Mortgage Bias Charges
    By CHARLIE SAVAGE
    Published: July 12, 2012

    WASHINGTON — Wells Fargo, the nation’s largest home mortgage lender, has agreed to pay at least $175 million to settle accusations that its independent brokers discriminated against black and Hispanic borrowers during the housing boom, the Justice Department announced on Thursday. If approved by a federal judge, it would be the second-largest residential fair-lending settlement in the department’s history.

    An investigation by the department’s civil rights division found that mortgage brokers working with Wells Fargo had charged higher fees and rates to more than 30,000 minority borrowers across the country than they had to white borrowers who posed the same credit risk, according to a complaint filed on Thursday along with the proposed settlement.
    http://www.nytimes.com/2012/07/13/bu...rges.html?_r=0
    The New York times ??? So I guess your'e going to believe everything you hear and post subjective liberal sources to back your claims. If you want the truth, you won't get it at the New York Times.

    "Discrimination" was checking to see if you had a down payment, good credit, good work history as everyone of those long held standards that the banks had been using for over a hundred years were tossed to the wayside during the sub-prime debacle.

    The people that cried discrimination called those standards "redlining". So liberal politicians forced banks and the GSE's to lower their standards, credit was free and easy and what happens when you lend money to someone with bad credit, a poor work history or low income happened,

    Massive default on millions of loans that nearly collapsed our economy.

    The Justice Department ? Eric Holder ? He's an idiot who worked for the Clinton administration under Janet Reno and was one of the people enforced the policies that forced the GSEs to lower their standards and subsequently nearly collapsed our economy.

    You see Wells Fargo refused to lower their mortgage lending Standards during the sub-prime debacle and now they are going to have to answer for maintaining standards that have kept our banking and financial system alive and kicking for a hundred years.

    It's just a Chicago style shake down. Same thing Eric Holder is doing to the S & P who should down grade our bonds just for Holders thuggish antics.
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    Re: U.S. sues S&P over subprime ratings

    The story about the Wells Fargo settlement has appeared in many other media outlets.

    If you want to argue that there has never been racial discrimination in housing and loans you are not going to have much credibility with anyone but racists.

    The feds documented that "Wells Fargo had charged higher fees and rates to more than 30,000 minority borrowers across the country than they had to white borrowers who posed the same credit risk." If the claim was wrong, the documents would have easily revealed that fact, instead Wells Fargo chose to settle.

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

    Quote Originally Posted by Fenton View Post
    Wow, just wow. Eric Holder helped enforce the anti " redlining" policies that helped create the massive democrat mandated sub-prime bubble.

    You know when asking people for a down payment and refusing people that had poor credit history was deemed "racist".

    Lol...the banks. Please. This administration is full of people that are directly responsible for the meltdown including the Democrat Congress.

    Its a offesive diversion. Holder did the same thing when he went after Wells Fargo because they maintained their standards and didnn't give into the Democrat thugs who threatened banks.

    Unreal how poorly educated some people are on this subject.
    If you continue to believe the CRA was the primary contributor or even a significant contributor to the meltdown, count yourself amongst the group of poorly educated on the subject..... unless of course, you are finally ready to explain how this really works. Duly noted that you offer cites herein other than your personal expertise.

    Of course, feel free to borrow some info from some of the prevailing wisdom on the subject....

    http://www.business.cch.com/bankingf...ime_WP_rev.pdf
    Three Causes of the Subprime Mortgage Crisis - ForensisGroup.com
    Lest We Forget: Why We Had A Financial Crisis - Forbes

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

    Quote Originally Posted by upsideguy View Post
    If you continue to believe the CRA was the primary contributor or even a significant contributor to the meltdown, count yourself amongst the group of poorly educated on the subject..... unless of course, you are finally ready to explain how this really works. Duly noted that you offer cites herein other than your personal expertise.

    Of course, feel free to borrow some info from some of the prevailing wisdom on the subject....

    http://www.business.cch.com/bankingf...ime_WP_rev.pdf
    Three Causes of the Subprime Mortgage Crisis - ForensisGroup.com
    Lest We Forget: Why We Had A Financial Crisis - Forbes
    Comedy of errors--one link thats a 404 and 2 that arent links. Try again.

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