The Real Causes Of The Great Recession

[zeke]

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.

Neil Bhutta and Glenn B. Canner are economists in the Division of Research and Statistics at the Board of Governors of the Federal Reserve System. The views expressed are those of the authors and do not necessarily reflect those of the Board of Governors or members of its staff.






Here is the concluding paragraph for two economists working in research and stats at the Board of Gov of the Federal Reserve.

But what the fuck could they know?

 

[Faun]

Congress misses that financial genius bawney fwank.....
More regulation and regulators to regulate the new regulations !!!
Civil servants to the rescue !

The guy in the minority party 1995-Jan 2007? What super powers did he have?


Right-wingers Want To Erase How George Bush's "Homeowner Society" Helped Cause The Economic Collapse


2004 Republican Convention:

Another priority for a new term is to build an ownership society, because ownership brings security and dignity and independence.
...

Thanks to our policies, home ownership in America is at an all- time high.

(APPLAUSE)

Tonight we set a new goal: 7 million more affordable homes in the next 10 years, so more American families will be able to open the door and say, "Welcome to my home."

It's hysterical how the right took credit for the housing boom ..... until it led to the collapse of the economy. Then suddenly it was the fault of a gay congressman from the minority party with super powers.

The right took credit for the housing boom? I don't seem to recall that. I recall the Democratic party touting how the CRA had opened the door to more home and diverse home ownership...which it did. I also seem to recall that it was the unusual amount of refinancning for cash out and refinancing for less monthly cost for ARM loans contributing to the bubble that the President at the time suggested congress to look into as he was well aware that something just wasn't right with how many loans were being labeled as "A"...and I recall Barney Frank, the head of the committee lashing out at the gentleman who read the findings to his committee when the findings showed that there was a serious issue...and I recall Barney Frank informing congress and the President that all is well with FM and that all concerns should be put to rest.
I also find it interesting that you put a label on a man based on his sexual preference......and I equally notice not a single person on this board found it to be offensive....even though they do not hesitate for a second to call out someone on the right when they do it.
I also noticed that you did not respond to my request for a source of your stat that only 6% of mortgage defaults were a result of the CRA.....

"THANKS to OUR policies, home ownership in America is at an all time high." - George Bush, 2004 RNC acceptance speech.

As far as the link you asked for .... I can't help you can't see it.

 

[Dad2three]

I like the part where folks put 5% or less down on a home and believe they own it ....
If it werent for those dang predators forging their witless signatures.....

At closing, with the witness of a notary public, the borrower must sign the 1003 four different times, twice on the first page, and every page thereafter....it was just a "talking point" to point the blame to someone else when the "victims" (the borrowers) claimed they did not know the mortgage broker changed their income and asset information.

OVER 50% of loans done in 2006 were low/no document loans, was this an oversight?

Which party has more culpability, someone who for a living is COACHING people to qualify for a loan, or someone who has NEVER bought a home before?

Predatory Lenders' Partner in Crime

Predatory lending was widely understood to present a looming national crisis.

What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge?

Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative


Eliot Spitzer - Predatory Lenders' Partner in Crime

 

[Dad2three]

Congress misses that financial genius bawney fwank.....
More regulation and regulators to regulate the new regulations !!!
Civil servants to the rescue !

The guy in the minority party 1995-Jan 2007? What super powers did he have?


Right-wingers Want To Erase How George Bush's "Homeowner Society" Helped Cause The Economic Collapse


2004 Republican Convention:

Another priority for a new term is to build an ownership society, because ownership brings security and dignity and independence.
...

Thanks to our policies, home ownership in America is at an all- time high.

(APPLAUSE)

Tonight we set a new goal: 7 million more affordable homes in the next 10 years, so more American families will be able to open the door and say, "Welcome to my home."

It's hysterical how the right took credit for the housing boom ..... until it led to the collapse of the economy. Then suddenly it was the fault of a gay congressman from the minority party with super powers.

The right took credit for the housing boom? I don't seem to recall that. I recall the Democratic party touting how the CRA had opened the door to more home and diverse home ownership...which it did. I also seem to recall that it was the unusual amount of refinancning for cash out and refinancing for less monthly cost for ARM loans contributing to the bubble that the President at the time suggested congress to look into as he was well aware that something just wasn't right with how many loans were being labeled as "A"...and I recall Barney Frank, the head of the committee lashing out at the gentleman who read the findings to his committee when the findings showed that there was a serious issue...and I recall Barney Frank informing congress and the President that all is well with FM and that all concerns should be put to rest.
I also find it interesting that you put a label on a man based on his sexual preference......and I equally notice not a single person on this board found it to be offensive....even though they do not hesitate for a second to call out someone on the right when they do it.
I also noticed that you did not respond to my request for a source of your stat that only 6% of mortgage defaults were a result of the CRA.....

So we agree, you are a dishonest POS who can't reason


Right-wingers Want To Erase How George Bush's "Homeowner Society" Helped Cause The Economic Collapse


2004 Republican Convention:

Another priority for a new term is to build an ownership society, because ownership brings security and dignity and independence.
...

Thanks to our policies, home ownership in America is at an all- time high.

(APPLAUSE)

Tonight we set a new goal: 7 million more affordable homes in the next 10 years, so more American families will be able to open the door and say, "Welcome to my home."

(APPLAUSE)

WATCH IT HERE:

Clip Bush Acceptance Speech Video C-SPAN.org

"I recall Barney Frank, the head of the committee"

LYING POS

Barney became 'head' of the committee Jan 2007, LONG after Dubya's subprime crisis


Q When did the Bush Mortgage Bubble start?

A The general timeframe is it started late 2004.

From Bush’s President’s Working Group on Financial Markets October 2008

“The Presidents Working Group’s March policy statement acknowledged that turmoil in financial markets clearly was triggered by a dramatic weakening of underwriting standards for U.S. subprime mortgages, beginning in late 2004 and extending into 2007.”



Q Did the Community Reinvestment Act under Carter/Clinton caused it?


A "Since 1995 there has been essentially no change in the basic CRA rules or enforcement process that can be reasonably linked to the subprime lending activity. This fact weakens the link between the CRA and the current crisis since the crisis is rooted in poor performance of mortgage loans made between 2004 and 2007. "

http://www.federalreserve.gov/newsevents/speech/20081203_analysis.pdf



Our analysis of the loan data found that about 60 percent of higher-priced loan originations went to middle- or higher-income borrowers or neighborhoods. Such borrowers are not the populations targeted by the CRA. In addition, more than 20 percent of the higher-priced loans were extended to lower-income borrowers or borrowers in lower-income areas by independent nonbank institutions--that is, institutions not covered by the CRA.

Putting together these facts provides a striking result: Only 6 percent of all the higher-priced loans were extended by CRA-covered lenders to lower-income borrowers or neighborhoods in their CRA assessment areas, the local geographies that are the primary focus for CRA evaluation purposes. This result undermines the assertion by critics of the potential for a substantial role for the CRA in the subprime crisis. In other words, the very small share of all higher-priced loan originations that can reasonably be attributed to the CRA makes it hard to imagine how this law could have contributed in any meaningful way to the current subprime crisis.


FRB Speech--Kroszner The Community Reinvestment Act and the Recent Mortgage Crisis--December 3 2008