FACTS on Dubya's great recession

You seem extraordinarily ignorant for a self-professed liberal.

Stalin and Mao make Hitler look like an underachiever, a wanna-be.

The problem with the hive mind is it requires universal participation. Hence authoritarianism will follow, as surely as night follows day.

 

More right wing garbage NOT based in reality. I'm shocked. You must be a Rushblo or Beckie fan!

 

You mean the authoritarian, nationalistic right wing conservatives? Yes



Right-wing authoritarians are people who have a high degree of willingness to submit to authorities they perceive as established and legitimate, who adhere to societal conventions and norms, and who are hostile and punitive in their attitudes towards people who don't adhere to them.



Right-wing authoritarianism is defined by three attitudinal and behavioral clusters which correlate together:

Authoritarian submission — a high degree of submissiveness to the authorities who are perceived to be established and legitimate in the society in which one lives.

Authoritarian aggression — a general aggressiveness directed against deviants, outgroups, and other people that are perceived to be targets according to established authorities.

Conventionalism — a high degree of adherence to the traditions and social norms that are perceived to be endorsed by society and its established authorities, and a belief that others in one's society should also be required to adhere to these norms

http://en.wikipedia.org/wiki/Right-wing_authoritarianism#History

 

A lot of unintentional humor in that response.

 

The idiot Bush assumed an unemployment rate of 4.3%, a balanced budget with surpluses projected all the way to a completely paid off debt, immediately began to cut tax rates for his oil buddies, started two wars, one totally unnecessary and funded them with emergency spending bills, off budget, then...after everything collapsed around his faltering ass handed $840 billion to the most powerful financial institutions in the world. They never did fail to give their big wheels annual bonuses amounting to millions in some instances.

He doubled the national debt and left the economy bleeding 750,000 jobs a month. That's the kind of stuff which happens when a C Student, draft dodging cowboy wannabe is elected to the most powerful position in the world.

 

Check out the last pages of U.S News and World Report during Carter’s last years, and look for an article about deregulation, and you will find when it started.

Also we are capable of learning from our mistakes, but if my Democratic congressperson will not respond either there isn’t much I can do about it except get pissed when Visa thinks it is funny that I am clueless.

Then you can check out the Democrats who sponsored and passed a law who then turned against their own law when the FED’s actions on it would not allow an “abused” spouse to run up a debt using her clueless husband’s income.

2004 Democratic Platform:

"Average family debt is higher than ever. And as they lose the struggle to make ends meet, one out of every seven middle class families may be bankrupt by the end of the decade...over time, fiscal discipline saves families thousands of dollars on their mortgages and credit cards.”

Please explain how federal fiscal discipline saves families from more than 50% DTI? The only way to limit DTI is regulation of it, see the last quote and compare it to the one explaining “Your debt-to-income ratio.”

“You have probably caught that Visa credit card commercial in which a wily wife hides her many shopping sprees under the bed and up in the attic, all out of sight from her clueless husband.
The punch line is that she could have won all that stuff she rung up on the plastic. But the reality behind such behavior is hardly a laughing matter.” (Rene a. Guzman, San Antonio Express-News Jan. 12, 2005 12:00 AM)


Neither Feeney or Kosmas responded to this:

"No creditor shall issue debt to any household which could exceed a 36% debt to income ratio, without the written knowledge and consent of both spouses or domestic partners in the household and each and every creditor the household already owes."


"Your debt-to-income ratio
36% or less: This is a healthy debt load to carry for most people.

37%-42%: Not bad, but start paring debt now before you get in real trouble.

43%-49%: Financial difficulties are probably imminent unless you take immediate action.

50% or more: Get professional help to aggressively reduce debt.

Source: Gerri Detweiler, author of The Ultimate Credit Handbook"
http://www.usnews.com/usnews/biztech/tools/modebtratio.htm

"WILLIS: A truck driver, Bernita saved up $14,000 to close on a six-bedroom house. Purchase price -- $180 grand. She thought she got a deal on her first loan, a two-year adjustable rate mortgage at 8.375 percent. Her monthly payments -- $1,200." http://transcripts.cnn.com/TRANSCRIPTS/0803/28/siu.01.html

http://www.politicalwrinkles.com/ne...rd-rules-limits-teen-cards-10.html#post115060

"BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM DivisIoN OF BANKING SUPERVISION AND REGULATION Date: September 30, 2005:"
"Another parameter that could be combined with LTV ratios to determine capital requirements might be a capacity measure such as a debt-to-income ratio." http://www.federalreserve.gov/BOARDDOCS/PRESS/BCREG/2005/20051006/Basel1Amemo.pdf

"The Charles Schwab Corporation ("Schwab,,)l appreciates the opportunity to comment on the Advance Notice of Proposed Rulemaking ("ANPR") issued by the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of Thrift Supervision (together, the "Agencies") regarding proposed revisions to the Agencies' existing domestic risk-based capital rules...

...P. 14 Another parameter that could be combined with LTV ratios to determine capital requirements might be a capacity measure such as a debt-to-income (DTI) ratio. The Agencies seek comment on (1) the use of an assessment mechanism based on LTV ratios in combination with credit assessments, debt-to-income ratios, or other relevant measures of credit quality; (2) the impact of the use of credit scores on the availability of credit orprices for lower income borrowers, and (3) whether LTVs and other measures of credit worthiness should be updated annually or quarterly and how theseparameters might be updated to accurately reflect the changing risk of a mortgage loan as it matures and asproperty values and borrower's credit assessmentsfluctuate. While we do support the use of combining LTV and industry standard FICO type credit scores in a risk-weighted capital guideline, as noted above, we do not support the inclusion of a capacity measure such as debt-to-income ratio (DTI). Our concern regarding the inclusion of such a measure is two-fold: (1) DTI is a much more subjective measurement than LTV or FICO score, and is not consistently calculated and applied by all lenders. Different lenders will calculate both income and debts using various guidelines. Additionally, some lenders will base DTI calculations only on verified income, while others may rely on stated income. There is too much variability in how this measurement is calculated and applied for it to be a meaningful guide to risk-based capital guidelines. And, (2) statistics have shown that DTI is a much less robust predictor of probability of default, or loss given default, than FICO scores and LTVs.

We do not believe that the use of credit scores in the risk-based capital guidelines will have a negative impact on the availability or price of credit to lower income borrowers. While the cost of capital can generally affect loan availability and price, we do not believe that applicant income is necessarily correlated with credit score. Many applicants with lower incomes have acceptable credit scores, while many applicants with high incomes have unacceptable credit scores. Banks are motivated to grant loans to generate revenue and profit, and most banks have very progressive mortgage programs for lower-income and fIrst-time homebuyers. The Community Reinvestment Act provides additional motivation for banks to reach out to meet the credit needs of the low-to-moderate income borrowers in their assessment areas" (January 17,2006, http://files.ots.treas.gov/comments/3173270d-dbd0-4b64-b398-487753ad9f27.pdf )

"Fed to discuss max 50% debt-to-income ratio for borrowers, prohibition on 'stated-income' loans to subprime borrowers, and other new rules" (May 29th, 2007, 3:38 pm) http://mortgage.freedomblogging.com...ns-to-subprime-borrowers-and-other-new-rules/

 

WHAT does deregulation matter when it's REGULATOR FAILURE UNDER RONNIE/DUBYA THAT WAS THE PROBLEM???


Who gives a f**** about loan to debt ratios when over 50% of loans 2006 (middle of Dubya's subprime crisis) were low/no doc loans?

AGAIN

DUBYA WAS REGULATOR. KNOW WHAT THAT IS SUPPOSED TO DO?

He fought ALL 50 states attempting to reign in "predatory" lenders

He not only IGNORED THE FBI WARNING OF AN EPIDEMIC OF MORTGAGE FRAUD IN 2004 (JUST AS THE SUBPRIME BUBBLE BEGAN), HE ACTUALLY GUTTED 1,800+ WHITE COLLAR AGENTS!

Dubya not only forced F/F to up their "goals" in affordable housing from 505 to 56% BUT HE CHANGED CLINTON'S RULE THAT DISALLOWED SUBPRIMES TO MEET THOSE GOALS. This was AFTER he required F/F to buy $440 billion in MBS's in the secondary market to reach his "goals"..

CRA LOANS? LOL, Less than 6% of ALL loans 2004-2007 were even done by banks covered by iy, NOT that even the 6% were close to gial related


BANKSTERS GAVE UP UNDERWRITING BECAUSE THEY COULD BUNDLE AND SELL THEM OFF, AND WERE CHEERED ON BY DUBYA AND THE "FREE MARKET" GUYS IN THE CONSERVATIVE THINK TANKS IN THE EARLY 2000'S!!!

 

Bush didn't cause the recession. Clinton, Congress and a bunch of shady bankers did.

 

No,It's what happens when democrats take control of congress...

 

Sure, DUBYA WASN'T REALLY IN CHARGE DURING THE PERIOD AND CHEERING ON THE BANKSTERS AND FIGHTING ALL 50 STATES WHO WANTED TO REIGN THEM IN IN THEIR WORLD WIDE CREDIT BUBBLE AND BUST. It was Clinton's fault *shaking head*

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NOW if ONLY you could show the laws they passed? Oops


From Bush's President's Working Group on Financial Markets March 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."

 

He claims to be non partisan. I especially like the "independent progressive" thing.

 

Technically Clinton just signed it, at a fundamental level it's a pathetic consequence of the collusion between the bankers and Congress. Congress during Bush's term was just as bought and paid for. Wouldn't matter if he wanted it or not, Bush would never have reinstated the Glass Steagle Act.

 

And I'm not overly fond of his insulting style of posting,myself.

 

G/S? REALLY? Try reading page one and going from there




Why The Glass-Steagall Myth Persists


If you tally the institutions that ran into severe problems in 2008-09, the list includes Bear Stearns, Lehman Brothers, Merrill Lynch, AIG, and Fannie Mae and Freddie Mac, none of which would have come under Glass-Steagall’s restrictions. Even President Obama has recently acknowledged that “there is not evidence that having Glass-Steagall in place would somehow change the dynamic.”

As for the FDIC-insured commercial banks that ran into trouble, the record is also clear: what got them into trouble were not activities restricted by Glass-Steagall. Their problems arose from investments in residential mortgages and residential mortgage-backed securities—investments they had always been free to engage in.

http://www.forbes.com/sites/objectivist/2012/11/12/why-the-glass-steagall-myth-persists/


THERE IS QUITE A LOT OF EVIDENCE OF DUBYA'S REGULATOR FAILURE STARTING PAGE ONE!

 

But the loosening of credit standards and terms in the subprime market was
symptomatic of a much broader erosion of market discipline on the standards and terms of loans...Bush authorized that policy statement....think he would have if he was responsible for economic downturn?......


And congress doesn't pass laws per se kid,the president does

And on 1/20/2007 the unemployment rate was 4.3%

 

Dubya's GROUP released the statement BASED ON FACTS


WASN'T LAWS BUT REGULATOR FAILURE BY DUBYA!!!


Jan 2007? Oh right then Dubya's bubble popped


Bush's documented policies and statements in timeframe leading up to the start of the Bush Mortgage Bubble include (but not limited to)

Wanting 5.5 million more minority homeowners
Tells congress there is nothing wrong with GSEs
Pledging to use federal policy to increase home ownership
Routinely taking credit for the housing market
Forcing GSEs to buy more low income home loans by raising their Housing Goals (2004)
Lowering Investment bank's capital requirements, Net Capital rule (2004)
Reversing the Clinton rule that restricted GSEs purchases of subprime loans (2004)
Lowering down payment requirements to 0% (2004)
Forcing GSEs to spend an additional $440 billion in the secondary markets (2003)
Giving away 40,000 free down payments (2004)
PREEMPTING ALL STATE LAWS AGAINST PREDATORY LENDING (2003)


But the biggest policy was regulators not enforcing lending standards.

 

So who were the regulators? were they the same ones who improperly reported over 10.5 billion in earnings?

 

You mean F/F ACCOUNTING SCANDALS? Weird $10 billion where sometimes more revenues and sometimes less were reported to meet expectations ? THAT ONE?

How does THAT compare to Dubya forcing F/F to purchase $440 BILLION in MBS's

But NO, F/F DIDN'T CAUSE A WORLD WIDE CREDIT BUBBLE AND BUST DUBYA CHEERED ON IN THE US!

 

What you just said was contradictory. You say that the Fed funds rate (which is short term) only marginally affects long term rates and that long term rates are more affected by inflation expectations. Current short term rates play a huge part in setting expectations for future inflation, and obviously would affect long term rates

Obviously, anyone who has had any exposure to the fixed income market knows that short term rates and long term rates are not independent and that yields tend to move together - i.e. upward and downward shifts in the curve. There are risk and liquidity premiums that are taken into account as well, but generally, the yield curve is dependent on expectations of future interest rates, and based on the "expectations hypothesis" in combination with the liquidity premium theory (two prevailing theories utilized by fixed income participants) long term rates can be computed as the geometric mean of shorter term rates. Expectations of future monetary policy (which is generally inferred from current monetary policy) also plays a large role.

What happened in 2006 when the yield curve inverted (and long term rates were lower than short term rates) was incredibly unusual as it happens very rarely. The Fed tried to raise rates to cool the housing market but investors had such a bleak outlook that it was too late. So it's not right to say that short term rates only play marginal role in determining long term rates. This unusual circumstance of an inverted yield curve was the result of a long period of easy credit and a terrible initiative on behalf of the government to increase homeownership at the time.

Also, you keep referring to ARMs as shoddy lending practices. ARMs are perfectly legitimate and useful contracts for those who know their features and what they're doing. Example - a borrower needs to be knowledgeable enough to know how to manage the event that negative amortization can trigger higher payment in a very short period of time. They also need to know about the fact that long term rates can increase and the home value may not appreciate indefinitely, and have some sort of forecast of both. The problem is that you had plumbers and construction workers trying to buy large houses they couldn't afford and they weren't educated enough to understand the risks they were undertaking. They simply wanted to buy a home and finance it in the cheapest way possible (ARMs are typically cheaper than fixed rate mortgages.)

 

What nonsense


WHO ALLOWED THEM TO TAKE OUT THE LOANS??? WHO DROPPED UNDERWRITING STANDARDS TO THOSE 0% AND 1% ARMS?



Predatory origination practices were especially prevalent within the HEL segment. Alt-A and subprime mortgages (sometimes called “B/C” mortgages to denote their lower credit quality) were sold to people with impaired credit history, or people who lacked the ability to make a large down payment, or people who did not have verification of their income. Alt-A is not strictly defined but is generally viewed as an intermediate category that encompasses borrowers with FICO scores to qualify for prime but who lack some other qualification.

The term subprime actually has a set of formal definitions. To qualify for a prime or conventional mortgage, a person needed 20% down and a credit FICO score of 660 or above (the average score is 710 on a scale from 450-900). Mortgagees who did not have these qualifications were not eligible for prime or conventional mortgages

In 2004, for the first time, these four categories of loans exceeded the prime market or conventional market. In 2001, the largest conventional (prime, government-insured) originator did 91% of its origination business in the conventional market, and only 9% in the non-prime market.


By 2005 the largest conventional originator was doing less than half of its origination business within the conventional sector (Inside Mortgage Finance 2009). In the peak of the mortgage craze in 2006, fully 70% of all loans that were made were unconventional mortgages.

This meant in a very short period of time, banks reoriented housing finance–one of the largest industries in the economy–around securitizations of highly risky loans. This astounding change in the character of the mortgage market was noticed by regulators and Congress. But, the Federal Reserve chose to ignore what was going on


http://www.tobinproject.org/sites/tobinproject.org/files/assets/Fligstein_Catalyst of Disaster_0.pdf

 

Starting in 1997 Clinton called for lowering down payments and had his regulators insist that lenders reduce credibility for less wealthy people to get loans. This continued under Bush until the housing boom balloon blew up and the Clinton/Bush recession started. Effectively the government caused the recession with easily obtained loans at low interest, and when interest went up on ARMs the forecloses started. When idiots blame the lenders their thumbs point at the real culprits.

 

When you leave out Clinton's contribution to the problem recession, you have missed the boat.

 

You can't see the forest because of the Bush.

Note that the prices started going up in Clinton's term, 1997, and continued up until the balloon blew up. Try truth for a change.

 

Nearly everything he posts is an insult to one's intelligence.

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Missing that boat is intentional. That's a reason why the left always proposes the same failed solutions to every problem. Intentional cluelessness.

 

What nonsense. Don't let FACTS get in the way

Clinton did a $4 BILLION total CRA covered (GOV'T GUARANTEED) that performed OK

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 March 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








NOTICE ANYTHING ON THAT GRAPH? lol




Examining the big lie: How the facts of the economic crisis stack up


•The boom and bust was global. Proponents of the Big Lie ignore the worldwide nature of the housing boom and bust.

A McKinsey Global Institute report noted “from 2000 through 2007, a remarkable run-up in global home prices occurred



Private lenders not subject to congressional regulations collapsed lending standards


http://www.washingtonpost.com/busin...sis-stack-up/2011/11/16/gIQA7G23cN_story.html




Conservatives Can’t Escape Blame for the Financial Crisis


The onset of the recent financial crisis in late 2007 created an intellectual crisis for conservatives, who had been touting for decades the benefits of a hands-off approach to financial market regulation. As the crisis quickly spiraled out of control, it quickly became apparent that the massive credit bubble of the mid-2000s, followed by the inevitable bust that culminated with the financial markets freeze in the fall of 2008, occurred predominantly among those parts of the financial system that were least regulated, or where regulations existed but were largely unenforced.

Predictably, many conservatives sought to blame the bogeymen they always blamed.


https://www.americanprogress.org/issues/economy/news/2010/12/21/8832/politics-most-blatant/

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