Housing Mess Started With Bill Clinton In 1999
 

Well for all of you blaming Bush for this mess look to your hero Bill Clinton who passed new lending laws in 1999.


[url=http://hotair.com/archives/2008/09/25/a-great-example-of-how-we-got-to-the-credit-market-meltdown/]Hot Air » Blog Archive » A great example of how we got to the credit-market meltdown[/url]

Re: Housing Mess Started With Bill Clinton In 1999
 

This article makes a lot of murky claims. Not a lot of hard analysis, so why don't you do us a favor and sum the argument up in your own words...

Re: Housing Mess Started With Bill Clinton In 1999
 

Good thread. I've said this loud and clear in another post that those who want to place blame SOLELY on the Bush Administration have to look a little deeper. I'm not placing blame in one place or another but our situations root's are much deeper, than just saying it's Bush's fault.

Clinton was on the Today show and spoke about this bill the other day. He really just said that at the time it seemed like the right thing to do.

Again, there are a lot of factors here not just Clinton/Bush.

Re: Housing Mess Started With Bill Clinton In 1999
 

I can't wait for 8 years from now when we can just toss all the blame for whatever is going on back to W.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Mattyk72;481315]I can't wait for 8 years from now when we can just toss all the blame for whatever is going on back to W.[/quote]


Duh, its always the person at fault that the media wants you to believe.

So it will be Obama's fault if he wins, or Bush's fault if McCain wins.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=firstdown;481275]Well for all of you blaming Bush for this mess look to your hero Bill Clinton who passed new lending laws in 1999.


[url=http://hotair.com/archives/2008/09/25/a-great-example-of-how-we-got-to-the-credit-market-meltdown/]Hot Air » Blog Archive » A great example of how we got to the credit-market meltdown[/url][/quote]

First, Clinton didn't pass any new laws. The Constitution does not permit the President to pass any legislation. Moreover, the Community Reinvestment Act was enacted in 1977, not 1999.

Second, the collapse of the housing market cannot be attributed to minorities becoming home owners. The CRA was designed to benefit low income areas, which includes inner cities [U]and[/U] rural areas (predominantly white areas). Moreover, banks were making money hand over fist on those sub-prime loans. As long as home prices kept skyrocketing, the banks were reaping huge rewards and not incurring many risks. The CEOs running those lending institutions knew the market could collapse, but they were far more concerned with making great profits on a quarterly basis.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Mattyk72;481315]I can't wait for 8 years from now when we can just toss all the blame for whatever is going on back to W.[/quote]

Is it just that you hate Bush that much and want to place blame on him w/out looking at the roots of a problem? Not saying he's not exempt from some criticism.

[url=http://www.investors.com/editorial/IBDArticles.asp?artsec=16&artnum=1&issue=20080925]Investor's Business Daily: Congress Pushed Fannie, Freddie In Wrong Direction During 1990s[/url]

[B]Congress Eases Lending Rules[/B]
In 1994, the Democratic Congress again moved, passing the Community Reinvestment Act — an update of the original 1977 law.
For the first time, homeowners that previously didn't qualify — either because they couldn't put any money down or had bad credit — were made eligible for government-backed loans.
The housing boom was on.
During the 1990s, according to one Fed study, Fannie and Freddie enjoyed a subsidy of as much as $182 billion, with most of that going to shareholders — not to poor borrowers, as supporters of the government-sponsored enterprises have often claimed.
Still, even after the GOP won control of Congress in 1995, Democrats in both houses worked with President Clinton as Fannie and Freddie's enablers.
Clinton, bypassing Republicans in Congress, had HUD rewrite the rules for Fannie and Freddie to let them get involved in the subprime market for the first time.
Robert Rubin's Treasury got involved too, reworking its own rules to crack down on banks that didn't make enough loans to distressed, minority neighborhoods.
That year, Fannie Mae bought an estimated $18.6 billion in subprime loans from banks. By 2004, that amount had exploded to $175 billion, or 44% of the total.
Republicans controlled Congress from 1995 through 2006. But under Clinton their hold was precarious, and with the Internet boom on and several foreign financial crises to deal with, Fannie and Freddie got lost in the shuffle.
[B]Too Little, Too Late[/B]
At the tail end of Clinton's administration, Treasury officials under the new secretary, Lawrence Summers, became alarmed at Fannie and Freddie's excesses.
Undersecretary Gary Gensler went to Congress in 2000 seeking an end to the companies' special status — especially the "implicit" federal guarantee of their now-$5.4 trillion loan portfolio — and more power for regulators to boost the companies' capital requirements.
Democrats raised a ruckus. So did Fannie and Freddie, which were both headed by politically well-connected CEOs who knew how to strategically reward — and punish — those who crossed them.
"We think that the statements evidence a contempt for the nation's housing and mortgage markets," Freddie Mac spokeswoman Sharon McHale said at the time, summing up the sentiment in Congress.
It was the last chance during the Clinton era for anything like real reform.
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[SIZE=2]Copyright 2000-2008 Investor's Business Daily, Inc.[/SIZE]

Re: Housing Mess Started With Bill Clinton In 1999
 

I think we can confidently blame the whole mess on just about anyone.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Sheriff Gonna Getcha;481329]First, Clinton didn't pass any new laws. The Constitution does not permit the President to pass any legislation. Moreover, the Community Reinvestment Act was enacted in 1977, not 1999.

Second, the collapse of the housing market cannot be attributed to minorities becoming home owners. The CRA was designed to benefit low income areas, which includes inner cities [U]and[/U] rural areas (predominantly white areas). Moreover, banks were making money hand over fist on those sub-prime loans. As long as home prices kept skyrocketing, the banks were reaping huge rewards and not incurring many risks. The CEOs running those lending institutions knew the market could collapse, but they were far more concerned with making great profits on a quarterly basis.[/quote]
The reason the CEO's where making all those loans is because a bill was passed in the 1990's allowing banks to sell these loans so they could get off the loan without all the risk involved. Fed & Fan ended up holding the notes to these loans and the rest is history. I know Clinton did not creat all of this on his own I was just making the point that it goes way back and everyone involved shares the blame. I also know Clinton cannot make laws but he got the mandate passed (which he signed) to force lenders to make allot of these bad loans. If you read the entire article the banks then came up with those Arm Loans so they could make these loans which was mandated that they do. All you have to do is type in Clinton and 1999 home loans and there is a bunch of stuff that changed in those years.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=redsk1;481331]Is it just that you hate Bush that much and want to place blame on him w/out looking at the roots of a problem? Not saying he's not exempt from some criticism.

[URL="http://www.investors.com/editorial/IBDArticles.asp?artsec=16&artnum=1&issue=20080925"]Investor's Business Daily: Congress Pushed Fannie, Freddie In Wrong Direction During 1990s[/URL]

[B]Congress Eases Lending Rules[/B]
In 1994, the Democratic Congress again moved, passing the Community Reinvestment Act — an update of the original 1977 law.
For the first time, homeowners that previously didn't qualify — either because they couldn't put any money down or had bad credit — were made eligible for government-backed loans.
The housing boom was on.
During the 1990s, according to one Fed study, Fannie and Freddie enjoyed a subsidy of as much as $182 billion, with most of that going to shareholders — not to poor borrowers, as supporters of the government-sponsored enterprises have often claimed.
Still, even after the GOP won control of Congress in 1995, Democrats in both houses worked with President Clinton as Fannie and Freddie's enablers.
Clinton, bypassing Republicans in Congress, had HUD rewrite the rules for Fannie and Freddie to let them get involved in the subprime market for the first time.
Robert Rubin's Treasury got involved too, reworking its own rules to crack down on banks that didn't make enough loans to distressed, minority neighborhoods.
That year, Fannie Mae bought an estimated $18.6 billion in subprime loans from banks. By 2004, that amount had exploded to $175 billion, or 44% of the total.
Republicans controlled Congress from 1995 through 2006. But under Clinton their hold was precarious, and with the Internet boom on and several foreign financial crises to deal with, Fannie and Freddie got lost in the shuffle.
[B]Too Little, Too Late[/B]
At the tail end of Clinton's administration, Treasury officials under the new secretary, Lawrence Summers, became alarmed at Fannie and Freddie's excesses.
Undersecretary Gary Gensler went to Congress in 2000 seeking an end to the companies' special status — especially the "implicit" federal guarantee of their now-$5.4 trillion loan portfolio — and more power for regulators to boost the companies' capital requirements.
Democrats raised a ruckus. So did Fannie and Freddie, which were both headed by politically well-connected CEOs who knew how to strategically reward — and punish — those who crossed them.
"We think that the statements evidence a contempt for the nation's housing and mortgage markets," Freddie Mac spokeswoman Sharon McHale said at the time, summing up the sentiment in Congress.
It was the last chance during the Clinton era for anything like real reform.
[URL="http://license.icopyright.net/3.7543?icx_id=20080925generalleft01"][IMG]http://license.icopyright.net/images/icopy-w.gif[/IMG] Click here for copyright permissions! [/URL]
[SIZE=2]Copyright 2000-2008 Investor's Business Daily, Inc.[/SIZE][/quote]

I never said Bush is to blame, I just think it's funny that some people keep tossing it back on Clinton. We've been on W's watch for 8 years now, and if you listen to some people 9/11 was Clinton's fault, the current economy crisis was his fault... I mean c'mon, it's just ridiculous.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Mattyk72;481355]I never said Bush is to blame, I just think it's funny that some people keep tossing it back on Clinton. We've been on W's watch for 8 years now, and if you listen to some people 9/11 was Clinton's fault, the current economy crisis was his fault... I mean c'mon, it's just ridiculous.[/quote]
So if Obama takes office everything is going to be his fault?

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=firstdown;481364]So if Obama takes office everything is going to be his fault?[/quote]

Once Obama is in he'll get a free ride with me. It's all on 'W' for the next 8 years.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Mattyk72;481366]Once Obama is in he'll get a free ride with me. It's all on 'W' for the next 8 years.[/quote]
Ok, I thought thats what you would say. LOL

Re: Housing Mess Started With Bill Clinton In 1999
 

I'm just kidding by the way. But in all seriousness, whoever the next President is will be inheriting quite the mess.

Re: Housing Mess Started With Bill Clinton In 1999
 

Dude, I feel sorry for whomever inherits this. Obama will be greatly constrained to implement his healthcare policy because of this bailout.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Mattyk72;481355]I never said Bush is to blame, I just think it's funny that some people keep tossing it back on Clinton. We've been on W's watch for 8 years now, and if you listen to some people 9/11 was Clinton's fault, the current economy crisis was his fault... I mean c'mon, it's just ridiculous.[/quote]

I think it's funny that the overwhelming majority seems to think this is all Bush's fault...the media, the left wings, Obama, when it's not necessarily true. Like someone else said a little blame deserves to go to everyone. If anything Bush didn't stand up enough for his own belief that Fannie/Freddie were just too big and needed to be scaled back. Everyone fought him on it.

So, I guess I'm taking up for the misinformation and some of the piling on that Bush is taking right now.

Re: Housing Mess Started With Bill Clinton In 1999
 

Anyway First, as someone who worked in the mortgage industry I can tell you that the claims made in that article are idiotic and borderline racist. As tech stocks cooled and September 11th threatened to puncture what had been a roaring American economy, the FED reduced interest rates to encourage investment in real estate, which was already a hot market. Programs like ARMS which had existed for a while exploded in popularity as housing prices began to appreciate at 20 percent or more per year. With equity piling up in homes people began to borrow against the value of their properties, assuming the free ride would go on forever. While they were of course wrong, the reversal of the housing market would have been a contained crisis if it wasn't for the reckless investment of Wall Street firms in collaterilzed debt packages: fantastically profitable, Wall St. kept watching the money come in, assuming the housing market would not regress, as there was no historical precedence for this in America. They were wrong, and what should have been a limited crisis in the US housing market punctured the entire global economy.

This is a complicated thing. It is not any one person's fault. You could of course blame Bush's "Ownership Society" which created tax incentives for buying over renting, further accelerating investment in the over-heated housing market. You could certainly blame the commitment to deregulation which reduced oversights that might have prevented so much Wall St. capital getting tangled up in murky debt packages. But to say that the increased minority homeownership which occurred under Clinton, which removed the racist barriers that had prevented minorities from owning homes at a rate equal to whites for like hundreds of years, was anything other than a good thing, is complete fucking bullshit. Seriously, bullshit. Racist fucking bullshit. I am furious right now that you would post this crap and I want to hear you defend the claims made by your author - with evidence, not partisan sloganeering.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=FRPLG;481334]I think we can confidently blame the whole mess on just about anyone.[/quote]

You can say that about so many things in our political world since the days of our founding fathers. But everyone needs someone to blame.

Re: Housing Mess Started With Bill Clinton In 1999
 

congress is mainly to blame, and freddie/fannie for paying off so many of the people that were supposed to be watching it (just like the oil lobbies). the introduction of mortgage liquidity (selling bad debt tracts) also turned it into a total monster.

clinton and mccain both tried to get more control over them i believe, but too many people were looking the other way.

there's plenty of blame to go around.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=djnemo65;481413]Anyway First, as someone who worked in the mortgage industry I can tell you that the claims made in that article are idiotic and borderline racist. As tech stocks cooled and September 11th threatened to puncture what had been a roaring American economy, the FED reduced interest rates to encourage investment in real estate, which was already a hot market. Programs like ARMS which had existed for a while exploded in popularity as housing prices began to appreciate at 20 percent or more per year. With equity piling up in homes people began to borrow against the value of their properties, assuming the free ride would go on forever. While they were of course wrong, the reversal of the housing market would have been a contained crisis if it wasn't for the reckless investment of Wall Street firms in collaterilzed debt packages: fantastically profitable, Wall St. kept watching the money come in, assuming the housing market would not regress, as there was no historical precedence for this in America. They were wrong, and what should have been a limited crisis in the US housing market punctured the entire global economy.

This is a complicated thing. It is not any one person's fault. You could of course blame Bush's "Ownership Society" which created tax incentives for buying over renting, further accelerating investment in the over-heated housing market. You could certainly blame the commitment to deregulation which reduced oversights that might have prevented so much Wall St. capital getting tangled up in murky debt packages. But to say that the increased minority homeownership which occurred under Clinton, which removed the racist barriers that had prevented minorities from owning homes at a rate equal to whites for like hundreds of years, was anything other than a good thing, is complete fucking bullshit. Seriously, bullshit. Racist fucking bullshit. I am furious right now that you would post this crap and I want to hear you defend the claims made by your author - with evidence, not partisan sloganeering.[/quote]


perfect. I was going to say the exact same things... except include the bush administration cutting the capital gains tax combined with the practice of like-kind trading allowing the tax to be skirted by savvy investors accross the country.

Re: Housing Mess Started With Bill Clinton In 1999
 

Blaming minorities for the housing crises is akin to blaming the Jews for the Holocaust. And that's all I have to say about that.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=saden1;481615]Blaming minorities for the housing crises is akin to blaming the Jews for the Holocaust. And that's all I have to say about that.[/quote]
No one was blaming them it seems that you take the easy reponse when you do not have a come back to answer a question. If I went back to allot of our threads a bunch of them end with your non response.

Re: Housing Mess Started With Bill Clinton In 1999
 

This is a very good thread, however, was it really needed? No one will admit when Clinton did anything wrong, he's like a cult hero or something.
Let's be clear, while the lending institutions did give out money a little too willingly, there really is no one to blame other than the people themselves. We all like to point blame to others, and make excuses, but the general public asked for money and AGREED IN WRITING to pay it back, they are the ones that should be blamed. Hell, I want a Corvette, BADLY! But you don't see me with one do you???? Of course not, cause I can't afford it. I have excellent credit, I can have it right now if I want it, but I know that will kill me financially. Blame the institutions all you want, but there was a time when a man's word meant something, now it means shit.

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Mattyk72;481355]I never said Bush is to blame, I just think it's funny that some people keep tossing it back on Clinton. We've been on W's watch for 8 years now, and if you listen to some people 9/11 was Clinton's fault, the current economy crisis was his fault... I mean c'mon, it's just ridiculous.[/quote]

No, it's really not ridiculous..

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=hesscl34;487028]No, it's really not ridiculous..[/quote]

see my above post about how he became "a cult hero". You can't say anything bad about Clinton, so what's the point?

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=Sheriff Gonna Getcha;481329]Second, the collapse of the housing market cannot be attributed to minorities becoming home owners. The CRA was designed to benefit low income areas, which includes inner cities [U]and[/U] rural areas (predominantly white areas). Moreover, banks were making money hand over fist on those sub-prime loans. As long as home prices kept skyrocketing, the banks were reaping huge rewards and not incurring many risks. The CEOs running those lending institutions knew the market could collapse, but they were far more concerned with making great profits on a quarterly basis.[/quote]

I would respectfully disagree. Sort of. Minorities owning property has nothing to do with it. Broke people getting loans does. These loans were first decreed by the gov't, insured by the gov't and then banks were sued for not giving them. There is a reason that homes prices tracked closely with inflation for decades. Banks didn't like giving out bad loans...they lost money on them. Once it became polically fashionable (read: buying votes) politicians started talking about "affordable housing" which means broke people buying houses. But banks said no. So the gov't went ahead and passed laws requiring "diversified" portfolios and then out of the other side of their mouths insured the loans so banks could afford to implement this new program. Magically home prices sky rocketed as the demand for homes exploded.

So the gov't makes banks give the loans and then creates a way for the banks to make profits on them and we want to blame the banks when they give out the loans? Sure there are greedy people but last time I checked companies are supposed to make money. When they get put out of business for not following laws they can't make money. When the gov't gives them an easy way to make money and they don't take it then they get fired.

On top of all this the two companies that insured, or bought, these loans were cooking their books to fool as many politicans as possible into thinking everything was great. When some did say that the situation was getting bad many others screamed back with uninformed and intellectually devoid arguments. Unfortunately the people who had an iota of what was actually happening didn't have the guts or the political capital to force some actual oversite.

This whole situation is a damn disaster but the politcs being played with it make me laugh. BO wants to blame this on lack of oversite by Repubs? Are you freaking kidding me? Well no f*cking sh*t there was not enough oversite! It's just not W's fault. In any way. Whatsoever. Let's go back in time an when Clinton and the Repubs wanted to create an oversite group and the Dems blithely dismissed them maybe we can kneecap those dummies so they can't get a vote because they were the ones who stopped it. Not Bush or McCain. The Dems. FACT. I blame the Repubs for not stopping this crap because they were too gutless to force a change. But I blame the basic principles of the Dems for causing it and then letting politics stop them from seeing the reality of the situation.

Re: Housing Mess Started With Bill Clinton In 1999
 

Banks said no...lol. I must say FRPLG, this is by far the poorest post by you I have ever seen. If you're going to make grandiose claims please cite your references. Specific bills and laws, any article on lobby effort against "affordable housing" by banks from reputable sources (sorry, blogs don't count) will do. Happy hunting!

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=saden1;487081]Banks said no...lol. I must say FRPLG, this is by far the poorest post by you I have ever seen. If you're going to make grandiose claims please cite your references. Specific bills and laws, any article on lobby effort against "affordable housing" by banks from reputable sources (sorry, blogs don't count) will do. Happy hunting![/quote]

Baaaaaa!

Re: Housing Mess Started With Bill Clinton In 1999
 

[quote=FRPLG;487161]Baaaaaa![/quote]


That's what I thought.

-saden1 a.k.a. Rain Man II
[yt]8ALdNck0f2o[/yt]