Fenton
DP Veteran
- Joined
- Nov 17, 2012
- Messages
- 29,771
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- Gender
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- Political Leaning
- Conservative
I will agree that the housing crisis and subsequent recession were not
totally Bush's fault, but his Administration did little to nothing to change the bubble or the regulations that the evil person Barney Frank supposedly created singlehandedly.
The Government Accountability Office, the Harvard Joint Center for Housing Studies, the Financial Crisis Inquiry Commission majority, the St Louis Federal Reserve and the Federal Housing Finance Agency, have all rejected the argument made by the ideologically-driven, that federal affordable housing policies were responsible for the proliferation of actual high-risk mortgages.
Fenton makes the claim
and those with knowledge tell us otherwise
You can find all of the supporting data you need on the internet to cherry pick around my primary claim.
That sub-prime bubble was Federally mandated through HUD and CRA regulations that were bolstered under Clinton.
Prior to the 90s the GSEs could only buy mortgages that were prime. In 1989 The Financial Institution Reform Recovery and Enforcment Act " encouraged banks to go through the motions to comply with CRA regulations by proving they were looking for applicants that fit the CRA requirements.
In 1995 Clinton requested the publishing of the HUD National Home Ownership Strategy and then moved the previous CRA enforcments from a process strategy to a "performance evaluation" system where banks instead of going through the proccess of meeting CRA requirements but not implementing them, which was legal under the 1989 bill, had to actually show they were making loans to low income borrowers.
The Reigle-Neil Interstate Banking Efficiency Act of 1994 tied new acquisitions of every bank into CRA compliance.
HUD..different but equally destructive regulator set quotas that started at 30% and went to 50% under Clinton amd then finally 55% under Bush.
In 2002 the GSEs were at the 1 trillion dollar mark on low quality loans.
The "Brookings Institute in 2004 ".....over the last decade Treasuries studies have shown that CRA helped to spur over a trillion in home mortgage , small bussiness, and community development lending to low and moderate income communities "
Andrew Cuomo in 2000 ( HUD Secretary ) and not a Con...anounced that the GSEs were commited to purchasing 2 Trillion in "affordable mortgages".
1997- the GSEs were offering 97% loan to value mortgages.
2001 - the GSEs were offering loans with no down.
2007- 55% of all GSEs mortgages had to be (LMI). Low quality. 38% of that had to be from "undeserved areas" and 25% had to be very low income borrowers
1995-2007 1.3 Trillion in loans were purchased with 5% less down payment.
2008 27 Million low quality loans, 20 million were on the books of Federal Agencies.
12 million were held or guaranteed by the GSEs
I could go on and on. The amount of objective data that proves this collapse was mandated by HUD and CRA regulations that forced the lowering of lendings standards and set quotas for the GSEs is almost endless.
I wosh some of you would wake the hell up.