Greed Caused the Subprime Mortgage Crisis, Not ACORN

On July 17, 1997 President Clinton gave an 11 page speech at the NAACP National Convention. During this speech he takes personal credit for the increase of loans given by banks under the Community Reinvestment Act (CRA).

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Page 8 of 11: What should we be doing? We've been working on this since 1993, to try to create the environment in which people would wish to invest and give people a chance -- empowerment zones, enterprise communities, community banks that loan money to people who live in the neighborhood to start small businesses, cleaning up the environment of our cities so people will feel free to invest and they won't worry about somebody coming along and suing them because we've already cleaned up the problems, giving tax relief to our lowest-income working people through the Earned Income Tax Credit, strengthening the Community Reinvestment Act so that more banks would invest money in the inner cities, opening up housing opportunities.

Page 9 of 11: First, the law. The law makes a difference. We've had a Community Reinvestment Act requiring banks to invest money in our under-invested areas on the books for 20 years. But since I became President and we said we were serious about it, of all the 20 years' investment. 70 percent of it has been done since 1993. The law matters. The law matters. (Applause.)

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I downloaded President Clinton's speech from the Clinton web-site

http://clinton4.nara.gov/textonly/lnitiatives/OneAmerica/naacp.html

on September 23, 2008. Two weeks later I went to the same web-site, and the document was gone. I can not seem to find it any where on the web.

So there you have it, from President Clinton himself. 70% of all the money transactions triggered by the Community Reinvestment Act (by 1997) had take place during his Administration, from 1993 to 1997.

Mike of ND 5:10PM October 25, 2009

also, most infamously, picketed the homes of resistant bankers and made threatening phone calls to their families. Meanwhile, Andrew Cuomo, then Secy. of HUD, bragged at a grand 1998 news conference how he succeeded in getting Bankers to set aside billions for these subprime risky loans in trade for not being prosecuted (persecuted?) for "discriminatory" lending practices.

In a couple of years, Barney Frank would be saying "I'm willing to roll the dice on this." (Continuing to make more and more extremely subprime loans in the interest of putting poor people in houses instead of apartments with the help of Fannie & Freddie which were run by ex-Clinton Admin. officials who made personal fortunes from salaries and bonuses.) It was more mob rule and government imposed social policy that caused this. "Greedy Bankers" and "Wall Streeters" adapted to the reality forced upon them. And this is what we got. Now the "actual villains" are rewriting history and shifting the blame to their opponents. It is a shame that so many are so ignorant and gullible that they buy into this revision of the reality.

Adpack of CA 11:26PM October 23, 2009

1. Real Estate agencies don't lend money so that point is inaccurate.

2. While I agree with you that greed (yes greed by all players in this case, not just the banks, lenders & politicians but the consumer too) indeed drove this debacle into overdrive, greed was not the motivation or the root cause behind the American dream program or the CRA program which your readers have written about in their comments.

3. So what is the real motivation in my opinion you might be asking. Well, I believe that it's a lot deeper than what seems at the surface. There is a long standing policy in place by men (yes men), very powerful and rich men from wealthy and powerful legacies to become kings. Some of you will get very skeptical at this point thinking I'm just about to espouse a conspiracy theory. Well, the term conspiracy theory has such a marginalized connotation most people can't handle it. So if you're one of those then stop reading on the other hand if you are truly open to ideas then read on.

For these men the desire to be a king is not limited to the shores of America but to become kings of the world. This is a tiny and small group but more powerful than any ever. Their agenda is to have the entire world under their control and while this is a huge task it has several layers and each layer transforms itself every few years. Economic cycles and political cycles transition as their plan is put into motion. Home ownership and real estate has historically proven to be one of the greatest stepping stones to building wealth. What we have witnessed in the last 10 odd years was the systemic transference of wealth from the serfs to the kings.

Let's face it, everyone knows something too good to be true is exactly that and "man" in his infinite wisdom will let temptation get the better of him. In this case millionaires were made just as they were with the dot.com stock debacle only it was an illusion. Those who were conservative and didn't get played are still ok for the most part but those who bit into the apple, (and the power players and their sophisticated systems of marketing, media hype and propaganda knew the probability of how many people would actually bite into the apple) well they as we know have been stripped off their "wealth" - now surely there was some innocent collateral damage too but for the most part here's the scenario.

Many americans who have been defrauded of their wealth will for years have to pay a hefty price for any and everything they buy with a loan. Our economic system is so credit dependent that we cannot afford to have this huge group of people out of the economy for 10 years until their "credit" gets better so we'll definitely continue to loan to these high risk individuals for a premium. Any guesses as to who benefits? Sure the banks, sure the CEO's but ultimately the "kings".

Ladies and gentlemen we have all been played. Dumbing down of america & now transference of wealth. You have to ask, what's next?

Uzi Husain of AZ 3:04PM October 19, 2009

You're right to say greed was a part of the mess. But to say "no Barny frank, not congress, you've got to be kidding! this congress pushed very hard for these bad policies. acorn protested banks for not giving bad loans. After acorn got exposed for some very bad "advice", do you think maybe they did the same for bad loan applications? of course they did! they helped lots & lots of people get loans. i bet if they went thru loans that acorn "helped" people get, your eyes would pop out! check House Bank & Finance committee, & Senate Bank & Finance committee. you'll be surprised!

Robert krawczyk of WI 6:01PM October 18, 2009