The REAL cause of the mortgage industry train wreck:

[TreeGreen]

Originally Posted by volinbham

Neocon? Talk about an overused term.

What should he have called him? Conservative? Religious right? They are all overused.

[oklavol]

If it's due to a law passed in 1977, then why are all the majority of foreclosed homes failed home loans made in the last 5 years?

[oklavol]

Originally Posted by gsvol

The mortgage crisis is a problem created in Washington long ago. It originated with the Community Reinvestment Act (CRA), signed into law in 1977 by President Jimmy Carter.

Ironically, an enthusiastic Fannie Mae Foundation report singled out one paragon of nondiscriminatory lending, which worked with community activists and followed "the most flexible underwriting criteria permitted." That lender's $1 billion commitment to low-income loans in 1992 had grown to $80 billion by 1999 and $600 billion by early 2003.

I wonder who's idea it was to increase low income loans from 80 billion in 1999 to 600 billion in 2003? It wouldn't have anything to do with Bush running for relection in 2004 on an economic platform of increasing home ownership would it?

[KB5252]

Originally Posted by oklavol

If it's due to a law passed in 1977, then why are all the majority of foreclosed homes failed home loans made in the last 5 years?

There are many factors at play there. Fuel prices, the economy (not just do to the mortgage problems) No doubt these bad loans were probably the biggest factor for the economy though. Bottom line is there was a failure in government. You may want to attribute everything to one man but as we have seen the president could not have acted on this alone and where was congress and our leaders on both sides of the aisle? Bottom line they all failed us.

[KB5252]

Originally Posted by oklavol

I wonder who's idea it was to increase low income loans from 80 billion in 1999 to 600 billion in 2003? It wouldn't have anything to do with Bush running for relection in 2004 on an economic platform of increasing home ownership would it?

It was a trend that was set in motion years before 2000.

[gsvol]

Originally Posted by volinbham

Neocon? Talk about an overused term.

Frequently used by airheads and those who fill airheads heads with meaningless psychobabble nonsense using short or often one word slogans.

Lenin seized power power using slogans such as Svoboda i bratsva, khleb i zemlya!!

Svoboda (freedom) and bratsva (brotherhood) sounded so great but then there was no freedom, no brotherhood. (despite the propaganda put out by the NYTs and Roosevelt.)

Khleb (bread) and zemlya (land) but the only bread to be had was too scarce to be had for all and gotten only after standing in line for four hours or more for one loaf, while the communist party stores had danish ham and caviar, and land? The the small landholders were all murdered and the farming coops worked no better than Roosevelt's farming coops during the great depression here in America.

[BigPapaVol]

Originally Posted by oklavol

If it's due to a law passed in 1977, then why are all the majority of foreclosed homes failed home loans made in the last 5 years?

Because the average life of a mortgage is 7 years, hence the vast majority are inside of 5 years old. That, coupled with the extremely low rates leading up to 2005, drove an enormous refi boom.

Again, pretending there is a single culprit here is retarded.

[gsvol]

Originally Posted by TreeGreen

What should he have called him? Conservative? Religious right? They are all overused.

He shouldn't have called me a name at all, what he should have done is address the topic!

Even a citizen who swears by Al Gore's insane rants should be able to understand that, should he not??

Originally Posted by oklavol

I wonder who's idea it was to increase low income loans from 80 billion in 1999 to 600 billion in 2003? It wouldn't have anything to do with Bush running for relection in 2004 on an economic platform of increasing home ownership would it?

Of course that was a contributing factor, but not the cause.

As a matter of fact many American's did indeed become home owners and still reside in the homes they bought.

Rather than blame Bush (and I'm not particularly fond of Bush for several reasons), why not place the blame on those really responsible. I.E.; those who perverted the system through fraud, those taking advantage of the system in order to create a crisis and for legislators who enabled certain groups to overload the system on purpose, borrowers who had no intention of ever paying off loans and some lenders who did give a rat's ... as long as they got their commission for making ill advised loans???????

Originally Posted by BigPapaVol

Again, pretending there is a single culprit here is retarded.

Well put!!

[oklavol]

Originally Posted by BigPapaVol

Because the average life of a mortgage is 7 years, hence the vast majority are inside of 5 years old. That, coupled with the extremely low rates leading up to 2005, drove an enormous refi boom.

Again, pretending there is a single culprit here is retarded.

God forbid we might actually blame the people in charge for anything.

[KB5252]

Originally Posted by oklavol

God forbid we might actually blame the people in charge for anything.

Who was on the chair responsible for oversight? Certainly Bush warrants some blame but what about everyone else involved?

[BigPapaVol]

Originally Posted by oklavol

God forbid we might actually blame the people in charge for anything.

why don't you walk me through how Bush is in charge of anything remotely related to the mortgage industry?

[gsvol]

Originally Posted by oklavol

God forbid we might actually blame the people in charge for anything.

Would you care to discuss the Federal Reserve Board and the Bank of International Settlements???

[oklavol]

Originally Posted by BigPapaVol

why don't you walk me through how Bush is in charge of anything remotely related to the mortgage industry?

Bush names the Fed chairman, the Fed chairman sets interest rate that money is loaned to banks, banks sets interest rates to the consumers. When rates are lows consumers then respond by making loans.

[BigPapaVol]

Originally Posted by oklavol

Bush names the Fed chairman, the Fed chairman sets interest rate that money is loaned to banks, banks sets interest rates consumers. When rates are lows consumers then respond by making loans.

Consumers don't ever make loans. The Fed chairman moves interest rates for any one of a number of reasons and rarely for the purpose of generating consumer and home loans.

By the way, mortgage loans move entirely independently of the Fed Funds rate. You do realize this, right? Mortgage lending is about rates investors at which investors are willing to buy mortgages.

[oklavol]

Originally Posted by BigPapaVol

Consumers don't ever make loans. The Fed chairman moves interest rates for any one of a number of reasons and rarely for the purpose of generating consumer and home loans.

By the way, mortgage loans move entirely independently of the Fed Funds rate. You do realize this, right? Mortgage lending is about rates investors at which investors are willing to buy mortgages.

The Fed chairman sets the rate money is loaned to banks, when the rate is lowered, the banks then in turn lower the rate they loan money to consumers.

So it becomes cheaper to buy a house because your house payment becomes lower because the interest rate on your home loan is lower.

Which is what Bush and his appointee the Fed Chairmen did, to stimulate home buying and home loans. They've had the rate so low for so long, they have it next to zero now and it has no effect. Which is part of the mess we have now, they can't stimulate the economy anymore with low interest rates because they have no where to go.