Investigate political pressure on Fannie & Freddie to buy junk loans
I have read in several articles that starting in 1999 during the Clinton Administration "revolutionary" changes were made to the CRA-Community Reinvestment Act. The changes placed supervisory oversight of Banks in the hands of activist Community organizations-Non-profits. If the Banks wished to lend outside of their geographic area they needed to get positive recommendations from these Non-Profits.The non-Profits were interested in having the Banks expand their lending to minorities. A noble thought but not if the folks getting a mortgage cannot afford to pay. One of these non-profits was known as ACORN. Fannie and Feddie were then "encouraged" by politicians like Barney Frank and Chris Dodd and others to buy these marginal mortgages as good public policy. Fannie and Freddie balked as they knew the loans were not solid. Claude Raines and Johnson had cooked their books to enhance their bonuses and were caught. The politicians made a deal to go easy on them if they would buy the bad loans. The Politicians named above and several others thought this was good public policy for minorities to have their own homes-it is good policy when they can afford to pay the mortgages. It has ruined many neighborhoods where foreclosures were called for due to non-payment.
Any possibility that we can get an investigation going to investigate what the above seems to indicate?
Steven P. Cariati
of NY
@
Dec 12, 2008 22:01:54 PM
Why spend tax payer money on our children's education?
We send our children to school in an effort to teach them the actions and reaction of life(balance of capitalism). ie. Spend more than you make, and you are in debt until the asset sells or you pay down what you owe. What the fu.. are they doing in Washington? Buying loans with no proof of income and then, to bail out the debtor, lets not appraise their house, just give them another loan... this is a joke!!! A giant cream pie in the face of the Working Tax Payer.
A Dietz
of MD
@
Dec 10, 2008 22:43:22 PM
I am shocked to learn that there is gambling on these premisis!
I am sure that I have misquoted Claude Rains in Casablanca, but I am surprised that there was only one email.
As for the Chief Risk Officer lossing his job, that is evidence that they feared that he was right.
fedwatcher
of CA
@
Dec 10, 2008 18:11:33 PM
They fire or dismiss anyone who tries to do the right thing in America, this is not news, this is the reality of working and living in the U.S.
Steven P. Cariati of NY @ Dec 12, 2008 22:01:54 PM
A Dietz of MD @ Dec 10, 2008 22:43:22 PM
fedwatcher of CA @ Dec 10, 2008 18:11:33 PM
C of WI @ Dec 10, 2008 11:28:27 AM
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