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Re: Former SEIU Official Reveals Secret Plan To Destroy JP Morgan & Crash Stock Marke
The CRA, whatver its merits, was simply NOT the cause of the housing crisis. A contributor? Seems likely. But the contention that the CRA created the bubble and tanked the market is just partisan fingerpointing.
Here's in interesting article from a pair of Federal Reserve economists:
It's a complex issue. You oversimplify, then try to use that oversimplification to assign blame. It's intellecutally bankrupt.
The Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII of the Housing and Community Development Act of 1977, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.) is a United States federal law designed to encourage commercial banks and savings associations to help meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods.[1][2][3] Congress passed the Act in 1977 to reduce discriminatory credit practices against low-income neighborhoods, a practice known as redlining.[4][5]
The CRA, whatver its merits, was simply NOT the cause of the housing crisis. A contributor? Seems likely. But the contention that the CRA created the bubble and tanked the market is just partisan fingerpointing.
Here's in interesting article from a pair of Federal Reserve economists:
Two basic points emerge from our analysis of the available data. First, only a small portion of subprime mortgage originations is related to the CRA. Second, CRA-related loans appear to perform comparably to other types of subprime loans. Taken together, the available evidence seems to run counter to the contention that the CRA contributed in any substantive way to the current mortgage crisis.
It's a complex issue. You oversimplify, then try to use that oversimplification to assign blame. It's intellecutally bankrupt.