Capitalism Guarantees Rising Inequality

[Contumacious]

Secondly the institutions lowered their standards far below what the CRA asked for. In fact one of the major faults you can place at the feet of government is the failure to regulate the markets both in terms of loan standards and balance sheet requirements.

If you don't understand that private institutions are in charge of their own financial security then I don't know what to tell you. There were plenty of banks that met CRA guidelines and didn't crash. The ones that crashed generally tried to maximize their profits by betting on the AAA rating of MBS.
t.

.

 

[Bombur]

There were housing bubbles in other nations in 97 too. There are a lot of reasons why there can be a bubble starting in 97 but a lot of things happened between 97 and the crash that caused this historic bubble besides what was going on in 97.

There is no doubt that F&F played a part in the MBS problem. The thing is the market is not set up to depend on them to make all the decisions. The market is not set up to allow a government institution to be a ratings agency or manage the risk portfolios of these financial institutions.

The risk that was taken on by these institutions was in no way limited to what the government was mandating. I have said this multiple times and it is important. The demand for sub-prime mortgages far outstripped the requirements of the government. The claim that these institutions failed because of risk that was forced upon them is simply false.

Secondly the institutions lowered their standards far below what the CRA asked for. In fact one of the major faults you can place at the feet of government is the failure to regulate the markets both in terms of loan standards and balance sheet requirements.

If you don't understand that private institutions are in charge of their own financial security then I don't know what to tell you. There were plenty of banks that met CRA guidelines and didn't crash. The ones that crashed generally tried to maximize their profits by betting on the AAA rating of MBS.

You are overstating the backing of F&F by the Federal government which was a mistake many investors made. They equated F&F to the federal government beyond what the law actually establishes. The bailout of F&F went beyond what the Federal government was legally required to do.

The whole reason F&F exists isn't to make financial decisions for the entire market. Those decisions to go above and beyond the federal requirements were their own. F&F was not regulated enough either btw.

Glass Steagall mattered because it played a major part in the amount of capital flowing into the bubble and the assets that were put at risk. Glass Steagall is important when talking about the size of the bubble and the need for a bailout.

The CRA did force them to lower the standards, it appears you admit that. Then, however, you appear to believe that they provided more sub-prime loans than the government mandated, thus going beyond what the law established.

Ok, please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide. Color of skin maybe? Was this CRA thing just supposed to reparations for blacks? What am I missing?

No criteria is needed for them to deny people sub-prime loans beyond what the government has mandated by definition.

 

[1776]

oh wait.....was GEORGE W BUSH in the White House in 1997????

There were housing bubbles in other nations in 97 too. There are a lot of reasons why there can be a bubble starting in 97 but a lot of things happened between 97 and the crash that caused this historic bubble besides what was going on in 97.

There is no doubt that F&F played a part in the MBS problem. The thing is the market is not set up to depend on them to make all the decisions. The market is not set up to allow a government institution to be a ratings agency or manage the risk portfolios of these financial institutions.

The risk that was taken on by these institutions was in no way limited to what the government was mandating. I have said this multiple times and it is important. The demand for sub-prime mortgages far outstripped the requirements of the government. The claim that these institutions failed because of risk that was forced upon them is simply false.

Secondly the institutions lowered their standards far below what the CRA asked for. In fact one of the major faults you can place at the feet of government is the failure to regulate the markets both in terms of loan standards and balance sheet requirements.

If you don't understand that private institutions are in charge of their own financial security then I don't know what to tell you. There were plenty of banks that met CRA guidelines and didn't crash. The ones that crashed generally tried to maximize their profits by betting on the AAA rating of MBS.

You are overstating the backing of F&F by the Federal government which was a mistake many investors made. They equated F&F to the federal government beyond what the law actually establishes. The bailout of F&F went beyond what the Federal government was legally required to do.

The whole reason F&F exists isn't to make financial decisions for the entire market. Those decisions to go above and beyond the federal requirements were their own. F&F was not regulated enough either btw.

Glass Steagall mattered because it played a major part in the amount of capital flowing into the bubble and the assets that were put at risk. Glass Steagall is important when talking about the size of the bubble and the need for a bailout.

 

[RKMBrown]

There were housing bubbles in other nations in 97 too. There are a lot of reasons why there can be a bubble starting in 97 but a lot of things happened between 97 and the crash that caused this historic bubble besides what was going on in 97.

There is no doubt that F&F played a part in the MBS problem. The thing is the market is not set up to depend on them to make all the decisions. The market is not set up to allow a government institution to be a ratings agency or manage the risk portfolios of these financial institutions.

The risk that was taken on by these institutions was in no way limited to what the government was mandating. I have said this multiple times and it is important. The demand for sub-prime mortgages far outstripped the requirements of the government. The claim that these institutions failed because of risk that was forced upon them is simply false.

Secondly the institutions lowered their standards far below what the CRA asked for. In fact one of the major faults you can place at the feet of government is the failure to regulate the markets both in terms of loan standards and balance sheet requirements.

If you don't understand that private institutions are in charge of their own financial security then I don't know what to tell you. There were plenty of banks that met CRA guidelines and didn't crash. The ones that crashed generally tried to maximize their profits by betting on the AAA rating of MBS.

You are overstating the backing of F&F by the Federal government which was a mistake many investors made. They equated F&F to the federal government beyond what the law actually establishes. The bailout of F&F went beyond what the Federal government was legally required to do.

The whole reason F&F exists isn't to make financial decisions for the entire market. Those decisions to go above and beyond the federal requirements were their own. F&F was not regulated enough either btw.

Glass Steagall mattered because it played a major part in the amount of capital flowing into the bubble and the assets that were put at risk. Glass Steagall is important when talking about the size of the bubble and the need for a bailout.

The CRA did force them to lower the standards, it appears you admit that. Then, however, you appear to believe that they provided more sub-prime loans than the government mandated, thus going beyond what the law established.

Ok, please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide. Color of skin maybe? Was this CRA thing just supposed to reparations for blacks? What am I missing?

No criteria is needed for them to deny people sub-prime loans beyond what the government has mandated by definition.

You lost me.

Yes or no government mandated sub-prime loans be provided that were by definition under the standards of non-sub-prime loans.

Assuming you are capable of agreeing with that. And assuming you won't duck the question again. I'll ask again.

Please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide.

I'll make it easier for ya.

10k people that don't qualify for a regular loan, ask for sub-prime loans. Government mandates 5k of those people be given sub-prime loans. Please tell the class what criteria they should have used to deny 5k people sub-prime loans and give 5k other people sub-prime loans the government was mandating they provide. Can't be based on risk factors like income, govco said so. Can't deny based on minority groups, govco said so. So please tell me what they could have used to deny Peter and allow Paul. Random lottery?

 

[1776]

The DOJ under Holder is again going after small local banks for not giving enough risky home loans to minorities....this is the 1990s all over again.

 

[Bombur]

The CRA did force them to lower the standards, it appears you admit that. Then, however, you appear to believe that they provided more sub-prime loans than the government mandated, thus going beyond what the law established.

Ok, please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide. Color of skin maybe? Was this CRA thing just supposed to reparations for blacks? What am I missing?

No criteria is needed for them to deny people sub-prime loans beyond what the government has mandated by definition.

You lost me.

Yes or no government mandated sub-prime loans be provided that were by definition under the standards of non-sub-prime loans.

Assuming you are capable of agreeing with that. And assuming you won't duck the question again. I'll ask again.

Please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide.

The government wasn't mandating that they provide them. This is the part you don't seem to get. The market all by itself started providing a lot of sub-prime loans that had nothing to do with the government regulations requiring them to offer loans to poor people. The regulations actually had little to nothing to do with the crash.

What did have a lot to do with the crash was MBS. Something that was used to help manage the risk of these sub-prime loans that were mandated. Eventually that worked well enough that the market started using MBS to push sub-prime loans to a degree that far exceeded the requirements of the CRA.

The Federal Reserve who was meant to help regulate this industry literally said that the market can regulate itself. History tells us it didn't.

 

[Redfish]

To the OP

NO, it doesn't. Liberalism does.

 

[Contumacious]

No criteria is needed for them to deny people sub-prime loans beyond what the government has mandated by definition.

You lost me.

Yes or no government mandated sub-prime loans be provided that were by definition under the standards of non-sub-prime loans.

Assuming you are capable of agreeing with that. And assuming you won't duck the question again. I'll ask again.

Please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide.

The government wasn't mandating that they provide them.

BULLSHIT




"So-called "community groups" like ACORN benefit themselves from the CRA through a process that sounds like legalized extortion. The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA "protest" is issued by a "community group." This can cost banks great sums of money, and the "community groups" understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities.

.

 

[RKMBrown]

The government wasn't mandating that they provide them. This is the part you don't seem to get. The market all by itself started providing a lot of sub-prime loans that had nothing to do with the government regulations requiring them to offer loans to poor people. The regulations actually had little to nothing to do with the crash.

What did have a lot to do with the crash was MBS. Something that was used to help manage the risk of these sub-prime loans that were mandated. Eventually that worked well enough that the market started using MBS to push sub-prime loans to a degree that far exceeded the requirements of the CRA.

The Federal Reserve who was meant to help regulate this industry literally said that the market can regulate itself. History tells us it didn't.

HUH? The red highlighted stuff you typed is in 180 degree conflict with the blue stuff you typed. The red stuff is completely wrong. Your post is like watching a down hill mogul skier.

It's congress's job to regulate not the fed. That fat gay democrat, Barney Frank, was the one stopping congress from regulating the mess.

 

[Bombur]

Not all of the sub-prime loans were mandated by government. The government created regulations that forced banks to create sub-prime mortgages for poor people. When MBS became profitable there was a large market demand for sub-prime loans. Not all sub-prime loans are to poor people or those that the law was intended to help. Not all sub-prime loans were created under the regulations of the program either.

There are a lot of regulations so I know it isn't clear when I am not differentiating between them. The Federal Reserve has regulatory authority over the balance sheets of financial institutions. That is different then the regulations concerning the creation of mortgages.

 

[Bombur]

You lost me.

Yes or no government mandated sub-prime loans be provided that were by definition under the standards of non-sub-prime loans.

Assuming you are capable of agreeing with that. And assuming you won't duck the question again. I'll ask again.

Please tell the class what criteria they should have used to deny people sub-prime loans that the government was mandating they provide.

The government wasn't mandating that they provide them.

BULLSHIT




"So-called "community groups" like ACORN benefit themselves from the CRA through a process that sounds like legalized extortion. The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA "protest" is issued by a "community group." This can cost banks great sums of money, and the "community groups" understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities.

.

Your own quote even says "a certain amount of bad loans" as opposed to an infinite amount of bad loans. So the remaining question is where was the market during the bubble. Was it right around that mandated minimum or was it well above it?

Google is your friend.

 

[Contumacious]

The government wasn't mandating that they provide them.

BULLSHIT




"So-called "community groups" like ACORN benefit themselves from the CRA through a process that sounds like legalized extortion. The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA "protest" is issued by a "community group." This can cost banks great sums of money, and the "community groups" understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities.

.

Your own quote even says "a certain amount of bad loans" as opposed to an infinite amount of bad loans. So the remaining question is where was the market during the bubble. Was it right around that mandated minimum or was it well above it?

Google is your friend.

"Banks have been placed in a Catch 22 situation by the CRA: If they comply, they know they will have to suffer from more loan defaults. If they don't comply, they face financial penalties and, worse yet, their business plans for mergers, branch expansions, etc. can be blocked by CRA protesters, which can cost a large corporation like Bank of America billions of dollars. Like most businesses, they have largely buckled under and have surrendered to their bureaucratic masters."

.

 

[Bombur]

BULLSHIT




"So-called "community groups" like ACORN benefit themselves from the CRA through a process that sounds like legalized extortion. The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA "protest" is issued by a "community group." This can cost banks great sums of money, and the "community groups" understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities.

.

Your own quote even says "a certain amount of bad loans" as opposed to an infinite amount of bad loans. So the remaining question is where was the market during the bubble. Was it right around that mandated minimum or was it well above it?

Google is your friend.

"Banks have been placed in a Catch 22 situation by the CRA: If they comply, they know they will have to suffer from more loan defaults. If they don't comply, they face financial penalties and, worse yet, their business plans for mergers, branch expansions, etc. can be blocked by CRA protesters, which can cost a large corporation like Bank of America billions of dollars. Like most businesses, they have largely buckled under and have surrendered to their bureaucratic masters."

.

Smart move ignoring the issue before you.

 

[Contumacious]

Your own quote even says "a certain amount of bad loans" as opposed to an infinite amount of bad loans. So the remaining question is where was the market during the bubble. Was it right around that mandated minimum or was it well above it?

Google is your friend.

"Banks have been placed in a Catch 22 situation by the CRA: If they comply, they know they will have to suffer from more loan defaults. If they don't comply, they face financial penalties and, worse yet, their business plans for mergers, branch expansions, etc. can be blocked by CRA protesters, which can cost a large corporation like Bank of America billions of dollars. Like most businesses, they have largely buckled under and have surrendered to their bureaucratic masters."

.

Smart move ignoring the issue before you.

IRRELEVANT.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should NOT be coerced or compelled to make one one one single loan.

.

 

[Bombur]

"Banks have been placed in a Catch 22 situation by the CRA: If they comply, they know they will have to suffer from more loan defaults. If they don't comply, they face financial penalties and, worse yet, their business plans for mergers, branch expansions, etc. can be blocked by CRA protesters, which can cost a large corporation like Bank of America billions of dollars. Like most businesses, they have largely buckled under and have surrendered to their bureaucratic masters."

.

Smart move ignoring the issue before you.

IRRELEVANT.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should NOT be coerced or compelled to make one one one single loan.

.

They must have thought all of those sub-prime loans they made beyond the requirements of the government were going to make them a profit.

 

[RKMBrown]

Smart move ignoring the issue before you.

IRRELEVANT.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should NOT be coerced or compelled to make one one one single loan.

.

They must have thought all of those sub-prime loans they made beyond the requirements of the government were going to make them a profit.

What part of the fact that they did make both a short term profit for making the initial sale, and then a long term profit when we bailed them out with tax payer funds, went over your head?

 

[Bombur]

irrelevant.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should not be coerced or compelled to make one one one single loan.

.

they must have thought all of those sub-prime loans they made beyond the requirements of the government were going to make them a profit.

what part of the fact that they did make both a short term profit for making the initial sale, and then a long term profit when we bailed them out with tax payer funds, went over your head?

wtf?

 

[Contumacious]

Smart move ignoring the issue before you.

IRRELEVANT.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should NOT be coerced or compelled to make one one one single loan.

.

They must have thought all of those sub-prime loans they made beyond the requirements of the government were going to make them a profit.

Shut the fuck up - that 's pure fiction.

.

 

[bripat9643]

Smart move ignoring the issue before you.

IRRELEVANT.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should NOT be coerced or compelled to make one one one single loan.

.

They must have thought all of those sub-prime loans they made beyond the requirements of the government were going to make them a profit.

No they didn't. They knew they were going to take it on the chin. They were counting on the government bailing them out.

 

[Bombur]

irrelevant.

Banks are in the business of lending money for a profit.

If they believe that you are a bad risk they are not going to lend it.

They should not be coerced or compelled to make one one one single loan.

.

they must have thought all of those sub-prime loans they made beyond the requirements of the government were going to make them a profit.

no they didn't. They knew they were going to take it on the chin. They were counting on the government bailing them out.

roflmao