Whos fault is the subprime market meltdown?

[Squeelr]

The Republicans. Plain and simple.

Why?

Read below.

Predatory Lenders' Partner in Crime
How the Bush Administration Stopped the States From Stepping In to Help Consumers

By Eliot Spitzer
Thursday, February 14, 2008; Page A25

Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets.

Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers.

Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices.

What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no.

Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.

Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules.

But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.

Throughout our battles with the OCC and the banks, the mantra of the banks and their defenders was that efforts to curb predatory lending would deny access to credit to the very consumers the states were trying to protect. But the curbs we sought on predatory and unfair lending would have in no way jeopardized access to the legitimate credit market for appropriately priced loans. Instead, they would have stopped the scourge of predatory lending practices that have resulted in countless thousands of consumers losing their homes and put our economy in a precarious position.

When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably. The tale is still unfolding, but when the dust settles, it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits. So willing, in fact, that it used the power of the federal government in an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers.
Eliot Spitzer - Predatory Lenders' Partner in Crime - washingtonpost.com

[Black Power]

Duh.

Everything is the Republicans fault.

Didn't you know Bush blew up the WTC himself? He was holding the detonator, those planes were an optical illusion.

They also rigged the elections of 2000 and 2004. They probably rigged a lot more than that too.

Oh yeah, they started the war in Iraq because it would make Bush a billionaire...yeah...billionaire....And he's the antichrist too by the way.

Yawwwwwwwwwwwwwn.

[IEATV8S]

Originally Posted by Black Power

Duh.

Everything is the Republicans fault.

Didn't you know Bush blew up the WTC himself? He was holding the detonator, those planes were an optical illusion.

They also rigged the elections of 2000 and 2004. They probably rigged a lot more than that too.

Oh yeah, they started the war in Iraq because it would make Bush a billionaire...yeah...billionaire....And he's the antichrist too by the way.

Yawwwwwwwwwwwwwn.

Will, did you CATCH who wrote that BS article? It's ELIOT SPITZER, you know the DEFROCKED GOVERNOR of NEW YORK, the GENIUS that was paying $4000+ a night for a tramp hooker! The one currently under FEDERAL INVESTIGATION for MONEY LAUNDERING!!!!!


Looks like Eliot got caught with some MUFF hair going down hard!!!! LOL!!!

What a RELIABLE SOURCE!!!! SQUEEKY is getting all upset with you guys bustin' his bubble! Maybe he doesn't like the fact that Larry is letting out all of Squeeky's SEX SECRETS??? Damn how STUPID do you have to be to post an article by a PRESUMED FELON!!!!

[Black Power]

Originally Posted by IEATV8S

Will, did you CATCH who wrote that BS article? It's ELIOT SPITZER, you know the DEFROCKED GOVERNOR of NEW YORK, the GENIUS that was paying $4000+ a night for a tramp hooker! The one currently under FEDERAL INVESTIGATION for MONEY LAUNDERING!!!!!


Looks like Eliot got caught with some MUFF hair going down hard!!!! LOL!!!

What a RELIABLE SOURCE!!!! SQUEEKY is getting all upset with you guys bustin' his bubble! Maybe he doesn't like the fact that Larry is letting out all of Squeeky's SEX SECRETS??? Damn how STUPID do you have to be to post an article by a PRESUMED FELON!!!!

Actually Roy I didn't read a damn thing. I figured it would be a bunch of slanted garbage and I did see the washington post mentioned at the end so I knew that I did well to skip reading it.

Good old Elliot. Maybe he can be John Edwards' VP in the 2012 Presidential Race. Nothing like cheering for the guy that cheated on his "dying of cancer" wife and the guy that laundered money so he could pay for some high dollar poon tang in order to cheat on his wife.

Whorehouses would have gone out of business by now if not for Democrap politicians.

[Squeelr]

Originally Posted by Black Power

Actually Roy I didn't read a damn thing. I figured it would be a bunch of slanted garbage and I did see the washington post mentioned at the end so I knew that I did well to skip reading it.

Good old Elliot. Maybe he can be John Edwards' VP in the 2012 Presidential Race. Nothing like cheering for the guy that cheated on his "dying of cancer" wife and the guy that laundered money so he could pay for some high dollar poon tang in order to cheat on his wife.

Whorehouses would have gone out of business by now if not for Democrap politicians.

Yeah...I figured you didn't read any of this. Nor do you guys know what you're talking about. Which is usually par for the course with you conservative types.

But let me give you a real education since you have no clue of what really happened.

Ever hear of the Glass-Steagal act of 1932? I'm sure you haven't.

Well...if you did, you'd know that back after the stock market crash of the 30s', the Glass-Steagal act was put in place to create a wall of separation between the banking industry and wall street.
What Was The Glass-Steagall Act?
Glass-Steagall Act - Wikipedia, the free encyclopedia

Why you ask? So you didn't have the intermingling that happened from 1999-2006 that caused the subprime market meltdown.

Now...I'm sure you'll ask me how this happened if there were regulations in place that kept this co-mingling of banks and wall street.

Well, then there were 3 Republicans in 1999 that created a bill, signed into law by Clinton called the Gramm-Leach-Bliley act which basically repealed the Steagall-glass act of the 30's and removed the regulations that were put in place to protect the consumer and our financial markets at large.
Gramm-Leach-Bliley Act - Wikipedia, the free encyclopedia

Oh wait! And it gets better! This is the same Phil Gramm that just called this country "a bunch of winers" over the subprime market!! Can you believe this POS!!!???

The very guy who's to blame along with his other co-conspirators, who's made money hand over fist since he left congress to go work at UBS Investment Bank (a financial services company based in Switzerland) as vice-chairman.
Phil Gramm - Wikipedia, the free encyclopedia

On April 1st, 2008 UBS announced—and it was writing down a further $19 billion on its investments in American subprime and other mortgages, as part of an unexpected SFr12 billion projected loss in the first quarter. The Swiss bank also said it would call on its shareholders to supply SFr15 billion in additional funds to shore up its depleted reserves of capital. That means shareholders face dilution, and UBS's sovereign-wealth backers may add to the potential losses (albeit paper ones) they have suffered since December.
UBS AG - Wikipedia, the free encyclopedia

Gee? I wonder who recommended UBS buy all that junk paper from the U.S.? Hmmm???

Not to forget either that Phil Gramm just left John McCains campaign as a financial advisor after this information went public.

McCain guru linked to subprime crisis

The general co-chairman of John McCain’s presidential campaign, former Sen. Phil Gramm (R-Texas), led the charge in 1999 to repeal a Depression-era banking regulation law that Democrat Barack Obama claimed on Thursday contributed significantly to today’s economic turmoil.

“A regulatory structure set up for banks in the 1930s needed to change because the nature of business had changed,” the Illinois senator running for president said in a New York economic speech. “But by the time [it] was repealed in 1999, the $300 million lobbying effort that drove deregulation was more about facilitating mergers than creating an efficient regulatory framework.”

Gramm’s role in the swift and dramatic recent restructuring of the nation’s investment houses and practices didn’t stop there.McCain guru linked to subprime crisis - Lisa Lerer - Politico.com

Republican filthy money grubbing scumbags that should be dragged by a rope behind a trailer and left in the desert as buzzard food.

[UNGN]

Originally Posted by Squeelr

Oh wait! And it gets better! This is the same Phil Gramm that just called this country "a bunch of winers" over the subprime market!! Can you believe this POS!!!???

No wait it gets even Better, Jim Leach endorsed Obama and will probably have a place in an Obama administration, while McLame told Gramm to take a hike.

[BLACK6PACK]

So, Clinton signed the bill into law? Sounds like its all clintons fault!

Its GB's fault we all know. It couldn't be the lenders that were greedy or the stupid home owners that knew they couldn't pay.

I qualified for a $350k mortgage when I was looking for a house. I bought a $112k house that I knew I could make the payments on. But you want to blame it on GB since he didn't have his finger on the pulse of the millions of things that could go wrong in this country. You can't fathom blaming it on the 2 people who are really responsible, the lenders and the borrowers.

[IEATV8S]

Gosh, you guys nailed the Squeelr again! I can here him all the way in N.Y. as he runs away from you!!!!! Guess he has to look to Weepster to SUCKLE on!!!

SOOOOOOO....EEEEEeeeeeeeeee!!!!!!

[SGRIM]

The only people to blame for the subprime lending problem is the greedy azz investors that kept pouring money to fund the loans. I am in the finance business, I can smell a BS application a mile away. They knew what they were buying were crap loans. They had high yield and the debtors "were" paying the mortgages. Soon as the gas and food went up, all that extra income these people had was gone....

It was actually "smart " short term wise to go borrow money at 4% from the bank and invest it in one of the major brokerage firms at 8%+ yield...


If they did a simple debt to income ratio before lending the money, most of this wouldn't happen.....

I could sale and finance 150+ cars a month, if I didn't care if the people could actually pay me back or not

Predatory lending laws have a place, I agree. Bottom line is if the customer and the lendor would take a few minutes and be honest and decide if the customer can actually pay or not there would not be a need for them....

[henschman]

Sqeelr, while i believe people need to be protected, i only believe that they need to be protected from other people who threaten their rights to life, liberty or property. People should NEVER be protected from themselves or the consequences of their own actions. that goes for consumers as well as businesses. it is just part of basic freedom to be able to contract freely with other people and enjoy/suffer the consequences of doing so.

your assertion basically rests on the idea that the people of this country are too stupid to know when and under what terms they should or shouldn't contract to borrow money, and that lenders are too stupid to know when they should or shouldn't loan money to someone at a given interest rate, and furthermore (this is the part I can't go along with), that it is the job of the geniuses in government to tell them under what conditions they can and can't contract with each other.

we live in a nation of adults who are treated like little children -- as if their own liberty is a threat to their well-being -- and the central planners in our government apparently believe that they are gifted with such superior wisdom that they should place themselves in charge of everyone else's life, since they can run it better than that person could run it himself.

i don't believe it is anybody else's place to tell me how i and another individual can voluntarily associate ourselves with each other. i believe in a concept of natural, inalienable rights, and freedom of association is a big part of them.

[quickerthanmost]

So it's Buyer beware. So by your account:

Cars should/ can be built that are dangerous and don't meet minimum standards and it should be left up to the consumer to determine their safety?!
I am not saying many people who live /bought beyond their means should suffer the consequences, but why should PREDATORY LENDING PRACTICES be allowed by Our Goverment?

All you are doing is condoning corporate SOCIALISM. Allowing Big Corporations to make $$$ off of the public in possibly Illegal, immoral ways!

[BLACK6PACK]

Your example is way off the mark. More like, the salesman tries to sell you a CTS-V for $65k and you can only make $400 a month payments. If the deal is done both you and the salesman/dealership are at fault.

Crappy construction is a totally different animal and doesn't even relate as an example.

[quickerthanmost]

The total deregulation of the banking industry, led to no oversight and the ability of bankers to construct these crazy ( defective) loans that are difficult to comprehend for many americans. Caveat Emptor to some degree but the purchase of a home should not be like the wild west with consumers being defrauded by a lack of legal knowledge. You advise a total adverserial position between banker/ consumer when shopping for a home loan?
Who does that benefit?