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The D-word


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#16 pstall

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Posted 03 March 2009 - 10:58 AM

If everyone keeps saying it is and keeps thinking about it..guess what..?
Contrarian is the way to go.
If you guys want to buy into the d word media spin, by all means.

#17 Jase

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Posted 03 March 2009 - 11:08 AM

If everyone keeps saying it is and keeps thinking about it..guess what..?
Contrarian is the way to go.
If you guys want to buy into the d word media spin, by all means.


:iamwithstupid:

#18 Htar

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Posted 03 March 2009 - 12:49 PM

Again, HTAR proves its poor people who somehow make the rest of us suffer.


Wasn't blaming anyone...merely pointing out a significant piece of legislation that is probably ground zero....Home ownership is a good thing, for anybody who CAN AFFORD it. Am I wrong?

#19 cookinwithgas

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Posted 03 March 2009 - 02:06 PM

In this case, yes. You may be getting your terms confused - the Fairness in Lending Act was useful when attacking Obama during the campaign as it was an Illinois deal.

If you are referring to the Community Reinvestment Act of 1977. Here are some helpful links for you

http://www.businessw...nity_reinv.html

http://en.wikipedia....inancial_crisis

Some economists, politicians and other commentators have charged that the CRA contributed in part to the 2008 financial crisis by encouraging banks to make unsafe loans. Others however, including the economists from the Federal Reserve and the FDIC, dispute this contention. The Federal Reserve and the FDIC holds that empirical research has not validated any relationship between the CRA and the 2008 financial crisis.[59][60]

Economist Stan Liebowitz wrote in the New York Post that a strengthening of the CRA in the 1990s encouraged a loosening of lending standards throughout the banking industry. He also charges the Federal Reserve with ignoring the negative impact of the CRA.[51] In a commentary for CNN, Congressman Ron Paul, who serves on the United States House Committee on Financial Services, charged the CRA with "forcing banks to lend to people who normally would be rejected as bad credit risks."[61] In a Wall Street Journal opinion piece, Austrian school economist Russell Roberts wrote that the CRA subsidized low-income housing by pressuring banks to serve poor borrowers and poor regions of the country.[62] Jeffrey A. Miron, a senior lecturer in economics at Harvard University, in an opinion piece for CNN, calls for “getting rid” of Fannie Mae and Freddie Mac, as well as policies like the Community Reinvestment Act that “pressure banks into subprime lending.”[63]

However, others dispute the involvement of the CRA in the crisis. San Francisco Federal Reserve Bank Governor Randall Kroszner has stated that no empirical evidence had been presented to support the claim that "the law pushed banking institutions to undertake high-risk mortgage lending".[59] In a Bank for International Settlements ("BIS") working paper, economist Luci Ellis concluded that "there is no evidence that the Community Reinvestment Act was responsible for encouraging the subprime lending boom and subsequent housing bust," relying partly on evidence that the housing bust has been a largely exurban event.[64] Others have also concluded that the CRA did not contribute to the current financial crisis, for example, FDIC Chairman Sheila Bair,[65] Comptroller of the Currency John C. Dugan,[66] Tim Westrich of the Center for American Progress,[67] Robert Gordon of the American Prospect,[68] Daniel Gross of Slate, and Aaron Pressman from BusinessWeek.[69]

Some legal and financial experts note that CRA regulated loans tend to be safe and profitable, and that subprime excesses came mainly from institutions not regulated by the CRA. In the February 2008 House hearing, law professor Michael S. Barr, a Treasury Department official under President Clinton,[70][34] stated that a Federal Reserve survey showed that affected institutions considered CRA loans profitable and not overly risky. He noted that approximately 50% of the subprime loans were made by independent mortgage companies that were not regulated by the CRA, and another 25% to 30% came from only partially CRA regulated bank subsidiaries and affiliates. Barr noted that institutions fully regulated by CRA made "perhaps one in four" sub-prime loans, and that "the worst and most widespread abuses occurred in the institutions with the least federal oversight".[71] According to Janet L. Yellen, President of the Federal Reserve Bank of San Francisco, independent mortgage companies made risky "high-priced loans" at more than twice the rate of the banks and thrifts; most CRA loans were responsibly made, and were not the higher-priced loans that have contributed to the current crisis.[72] A 2008 study by Traiger & Hinckley LLP, a law firm that counsels financial institutions on CRA compliance, found that CRA regulated institutions were less likely to make subprime loans, and when they did the interest rates were lower. CRA banks were also half as likely to resell the loans.[73] Emre Ergungor of the Federal Reserve Bank of Cleveland found that there was no statistical difference in foreclosure rates between regulated and less-regulated banks, although a local bank presence resulted in fewer foreclosures.[74]

During a 2008 House Committee on Oversight and Government Reform hearing on the role of Fannie Mae and Freddie Mac in the financial crisis, including in relation to the Community Reinvestment Act, asked if the CRA provided the “fuel” for increasing subprime loans, former Fannie Mae CEO Franklin Raines said it might have been a catalyst encouraging bad behavior, but it was difficult to know. Raines also cited information that only a small percentage of risky loans originated as a result of the CRA. Bob McTeer, president of the Dallas Federal Reserve Bank from 1991 to 2004, said “There was a lot of pressure from Congress and generally everywhere to make homeownership affordable for poor and low-income people. Some mortgages were made that would not have ordinarily been made.” He also said “When a bank made a decision to purchase mortgaged-backed securities, they would somehow determine if some of them were in zip codes covered by the CRA, and therefore they could get CRA credit.”[75][76]



#20 shinner

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Posted 03 March 2009 - 04:05 PM

Well, there was some good news today. Consumer spending and wages were actually up in January for the first time in 8 months.

I knew Obama would turn it around....and in only 5 weeks. Amazin'!

#21 SCP

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Posted 03 March 2009 - 04:28 PM

Conservatives are hoping we get there so they can point fingers. They hate America.


Enjoy.


:confused: Somebody is all pissy because the guy they voted for is not the demigod he promoted himself to be....that must be such a huge buzz kill. I can't believe he used a teleprompter when he announced Kathleen Sebelius. lolz

I love the hypocrisy of liberal patriotism. :patriot:

#22 Panthro

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Posted 03 March 2009 - 04:29 PM

You hate america like you hate pilates

#23 SCP

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Posted 03 March 2009 - 04:31 PM

I hate pilates like I hate candy corn.

I love 'merica.

#24 Panthro

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Posted 03 March 2009 - 04:38 PM

But yet you hate America's Team...interesting

#25 SCP

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Posted 03 March 2009 - 04:50 PM

But yet you hate America's Team...interesting


Hate is not a strong enough word. I loathe America's team and their fan base.

#26 LiQuiD

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Posted 04 March 2009 - 12:45 PM

If everyone keeps saying it is and keeps thinking about it..guess what..?
Contrarian is the way to go.
If you guys want to buy into the d word media spin, by all means.


And pretending we're not heading that way very quickly is just ignorant as hell. But enjoy your bliss while it lasts.:out:

Click your heels three times and get us out of this mess, Dorothy.


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