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Discussion Starter · #1 · (Edited)
Who is Responsible for the US Economic Disaster?

The Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.) is a United States federal law that requires banks and savings and loan associations to offer credit throughout their entire market area and prohibits them from targeting only wealthier neighborhoods with their services, a practice known as "redlining." The purpose of the CRA is to provide credit, including home ownership opportunities to under-served populations and commercial loans to small businesses. It has been subjected to important regulatory revisions.

Was it Jimmy Carter?

Original Act
The CRA was passed into law by the 95th United States Congress in 1977 as a result of national grassroots pressure for affordable housing, and despite considerable opposition from the mainstream banking community.[1] Only one banker, Ron Grzywinski from ShoreBank in Chicago, testified in favor of the act.[2] The CRA mandates that each banking institution be evaluated to determine if it has met the credit needs of its entire community. That record is taken into account when the federal government considers an institution's application for deposit facilities, including mergers and acquisitions. The CRA is enforced by the financial regulators (FDIC, OCC, OTS, and FRB). However, until 1995 the Act was laxly enforced and banks only were required to advertise in local minority newspapers or sit on the boards of local community groups.[3]
The bill encouraged mortgage lending through two government sponsored enterprises ("GSEs"). The Federal National Mortgage Association, commonly known as Fannie Mae, enables mortgage companies, savings and loans, commercial banks, credit unions, and state and local housing finance agencies to lend to home buyers. The Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac, buys mortgages on the secondary market and sell them as mortgage-backed securities on the open market.[4]

Was it Bill Clinton?

Clinton Administration Changes of 1995
In early 1993 President Bill Clinton ordered new regulations for the CRA which would increase access to mortgage credit for inner city and distressed rural communities.[5]
The new rules went into effect January 31, 1995 and featured: strictly numerical assessments to get a satisfactory CRA rating; using federal home-loan data broken down by neighborhood, income group, and race; encouraging community groups to complain when banks were not loaning enough to specified neighborhood, income group, and race; allowing community groups that marketed loans to target to groups to collect a fee from the banks (as of 2000 $9.5 billion had been paid to such nonprofit groups). The new rules, during a time when many banks were merging and needed to pass the CRA review process to do so, substantially increased the number and aggregate amount of loans to low- and moderate-income borrowers for home loans, some of which were "risky mortgages."[3] The number of CRA mortgage loans increased by 39 percent between 1993 and 1998, while other loans increased by only 17 percent.[6][7]
Related rule changes gave Fannie and Freddie extraordinary leverage, allowing them to hold just 2.5% of capital to back their investments, vs. 10% for banks. By 2007, Fannie and Freddie owned or guaranteed nearly half of the $12 trillion U.S. mortgage market.[4] Due to massive financial losses, on September 7, 2008 the Federal Housing Finance Agency (FHFA) put Fannie Mae and Freddie Mac under the conservatorship of the FHFA.[8]

Did the Democratic Congress prevent Bush from stopping it?

George W. Bush Administration Proposed Changes of 2003
In 2003, the Bush Administration recommended what the NY Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." The proposal was to move governmental supervision of two of the primary agents guaranteeing subprime loans, Fannie Mae and Freddie Mac under a new agency created within the Department of the Treasury. However, the proposal did not alter the implicit guarantee of a Washington funded bail out in case the companies ran into financial difficulties, a perception that enabled these institution to issue debt at significantly lower rates than their competitors. Congressional support was approximately split along Party lines and the proposal eventually failed. Representative Barney Frank (D-MA) claimed of the thrifts "These two entities—Fannie Mae and Freddie Mac—are not facing any kind of financial crisis, the more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." Representative Mel Watt (D-NC) added "I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing."
 

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Inglourious Basterd
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Let's not forget deregulation supported by McCain ,let's not forget the $72 million bonus recieved by the CEO of AIG last year and $100's of millions in bonuses that all the other douchebag CEO's of these failing banks gave their selves. Let's not forget the 2 million people that have lost their jobs in the last 8 years and can no longer pay their mortgages. Let's not forget the 125% equity loans given by these banks. There is plenty of blame to go around to everyone.
 

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Inglourious Basterd
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George W. Bush Administration Proposed Changes of 2003
In 2003, the Bush Administration recommended what the NY Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." The proposal was to move governmental supervision of two of the primary agents guaranteeing subprime loans, Fannie Mae and Freddie Mac under a new agency created within the Department of the Treasury. However, the proposal did not alter the implicit guarantee of a Washington funded bail out in case the companies ran into financial difficulties, a perception that enabled these institution to issue debt at significantly lower rates than their competitors. Congressional support was approximately split along Party lines and the proposal eventually failed.
In 2003 ,the repubs. had control of all 3 branches of government ,so let's put some blame there. It's funny how you rightwingers want to pretend like the current democrat majority congress has all the power in the world , but when the repubs. had the congress AND the senate AND the Whitehouse ,they were helpless ,against the democrat minority. JESUS
 

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Discussion Starter · #5 ·
IBD: Carter More to Blame for Financial Crisis Than Bush or McCain
By NOEL SHEPPARD,
Published 2008-09-20 14:15:19

Much as Bush-hating media members conveniently ignore historical events that led to the invasion of Iraq in March 2003, their current finger-pointing at the White House, John McCain, and all Republican politicians for the collapse of the financial services industry lacks any honest assessment of decades-old legislation that laid the groundwork for today's problems.

In particular, 1977's Community Reinvestment Act which required banks and savings institutions to make loans to the lower-income areas in the communities they served.

Despite how integrally tied the current crisis is to this bill enacted by a Democrat-controlled Congress and signed into law by Jimmy Carter, no major media outlet other than Investor's Business Daily and National Review Online mentioned it during last week's market meltdown.

Going against the grain was a highly-informative editorial by IBD Thursday (emphasis added, h/t NBer Gary Hall, photo courtesy About.com):

To hear today's Democrats, you'd think all this started in the last couple years. But the crisis began much earlier. The Carter-era Community Reinvestment Act forced banks to lend to uncreditworthy borrowers, mostly in minority areas.

Age-old standards of banking prudence got thrown out the window. In their place came harsh new regulations requiring banks not only to lend to uncreditworthy borrowers, but to do so on the basis of race.

These well-intended rules were supercharged in the early 1990s by President Clinton. Despite warnings from GOP members of Congress in 1992, Clinton pushed extensive changes to the rules requiring lenders to make questionable loans. [...]

Failure to comply meant your bank might not be allowed to expand lending, add new branches or merge with other companies. Banks were given a so-called "CRA rating" that graded how diverse their lending portfolio was. [...]

In the name of diversity, banks began making huge numbers of loans that they previously would not have. They opened branches in poor areas to lift their CRA ratings.

Meanwhile, Congress gave Fannie and Freddie the go-ahead to finance it all by buying loans from banks, then repackaging and securitizing them for resale on the open market.

That's how the contagion began.

With those changes, the subprime market took off. From a mere $35 billion in loans in 1994, it soared to $1 trillion by 2008.

Readers are strongly encouraged to review this entire fact-filled piece to not only better understand the roots of today's financial crisis, but also to get a sense as to just how absurd media accusations of this all being Bush and McCain's fault are.

That said, from 1989 through 1995, I managed branches for two savings and loans: Imperial Savings, which got taken over by the Resolution Trust Corporation during the S&L bailout, and; Great Western Bank which eventually was purchased by Washington Mutual.

The pressure to comply with CRA was astounding, especially at Great Western as it was expanding throughout the country. Its ability to acquire other institutions was directly related to its CRA rating.

With this in mind, IBD's views concerning this matter are spot on raising a very important question: if the role of news media is to inform the public, why does a LexisNexis search indicate that as this crisis came to a head last week, its connection to CRA, Jimmy Carter, and Bill Clinton was almost completely ignored?

Would such a revelation make it difficult for Obama-loving press outlets to point fingers at George W. Bush and, more importantly, John McCain?

Yes, that's a rhetorical question.
 

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Inglourious Basterd
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LMAO, let's go back 31 years and blame Jimmy Carter for the banking collapse in 2008 , let's go back to Abraham Lincoln while we're at it. This country is full of people that refuse to take blame for their own actions . These banks created this collapse on their own,through poor loaning practices ,greed ,and mismanagement by multimillionaire CEO's.
 

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I help enlighten folks
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I'd like to know the source of the original post. probably along the lines of anne coulter.
Fail.
 

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The end is near.
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How about we put the blame where it really belongs. The buck has to stop with 'We The People'. Every politician is an employee for 'We The People'. Therefore, 'We The People' are the boss and have to take the blame for this fiasco. The 'Boss' fell asleep at the wheel and the employees went wild, even working for other companies while they were working for us. And we allowed it.

Time to clean house, people. Get rid of these politicians who have committed treason by whoring themselves out to the large corporations instead of working for 'We The People'. We have to get educated and fast so we can make intelligent decisions about who we want working for us in the future.

If 'We The People' don't fix this and fast we're going to have to pay the price for our ignorance and lack of attention.
 

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Joe McCarthy was Right!
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How about we put the blame where it really belongs. The buck has to stop with 'We The People'. Every politician is an employee for 'We The People'. Therefore, 'We The People' are the boss and have to take the blame for this fiasco. The 'Boss' fell asleep at the wheel and the employees went wild, even working for other companies while they were working for us. And we allowed it.

Time to clean house, people. Get rid of these politicians who have committed treason by whoring themselves out to the large corporations instead of working for 'We The People'. We have to get educated and fast so we can make intelligent decisions about who we want working for us in the future.

If 'We The People' don't fix this and fast we're going to have to pay the price for our ignorance and lack of attention.


Wow, you have really touched on something here. the fualt lies with, ultimately, WE THE PEOPLE. thats right. It sucks but it is true. Anyone that ever voted for a crapy politician that promised more from the government, qualifies. wether it be for SSI, WIC, unemployemnt insurance, whatever..... WE THE PEOPLE have failed ourselves, in the 1700's if a politician was a piece of S... someone would offer to duel him and hopefully kill his ass. WE THE PEOPLE have become complacent, we have become soft, we have become dependant on the government. If WE THE PEOPLE could get back to supporting ourselves then WE THE PEOPLE could have a solid nation.

Unfortunately, WE THE PEOPLE have sold ourselves out.


Disclamer: yes I know we all havent voted for socialist programs, but WE THE PEOPLE represent the majority of the USA.
 

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Some of you are not going to like this but: I believe we need to stop taking money from other nations, send all non us citizens back to were they come from with thier money and demand the money we loaned and gave to other nations, send all as well as them south of the border folks, and take thier money there taking ours and sending it home to mexico, and let the stock market crash as well as the big banks crash, heres my example if you lose your job and cannot pay your bills or notes on housing or car payments what hapens to you? well I'll answer your screwd! same goes for them in washington and new york stock exchange. so now some one will say what about all those peoples jobs lives and families, well this country went through another depression well live through another, some of you will probably say you don't know what your taking about, well sorry I do I have lost everything house ,vehicles, and am having trouble getting food stamps simply because I'm white and not mexican, black, or what ever now, I am looking forward to the revolt that is comming, thaks to corproate greed, hate, ungodliness damn I am off the soap box now.
 

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Discussion Starter · #14 · (Edited)
LMAO, let's go back 31 years and blame Jimmy Carter for the banking collapse in 2008 , let's go back to Abraham Lincoln while we're at it. This country is full of people that refuse to take blame for their own actions . These banks created this collapse on their own,through poor loaning practices ,greed ,and mismanagement by multimillionaire CEO's.
Every Democrat has had a hand in the demise of the USA. But, Abraham Lincoln did only good, he was a Republican.
 

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Some of you are not going to like this but: I believe we need to stop taking money from other nations, send all non us citizens back to were they come from with thier money and demand the money we loaned and gave to other nations, send all as well as them south of the border folks, and take thier money there taking ours and sending it home to mexico, and let the stock market crash as well as the big banks crash, heres my example if you lose your job and cannot pay your bills or notes on housing or car payments what hapens to you? well I'll answer your screwd! same goes for them in washington and new york stock exchange. so now some one will say what about all those peoples jobs lives and families, well this country went through another depression well live through another, some of you will probably say you don't know what your taking about, well sorry I do I have lost everything house ,vehicles, and am having trouble getting food stamps simply because I'm white and not mexican, black, or what ever now, I am looking forward to the revolt that is comming, thaks to corproate greed, hate, ungodliness damn I am off the soap box now.
You have a GREAT point , which is very well said . ( so now comes the bad part )

PARAGRAPH'S AND SPELLING , ......PLEASE .

Pride should keep you from seeking food stamps , it did me .
 

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Joe McCarthy was Right!
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Every Democrat has had a hand the demise of the USA. But, Abraham Lincoln did only good, he was a Republican.


The problem is though, that it isnt a republican/democrat thing. They have devolved into the same thing. All they are concerned with is buying votes, and after a society gets to the point that they realize that they can vote themselves benefits, profiting from the government, then you have moved from liberty into communism. If you want liberty then you MUST accept the consequences of that liberty, meaning that failure is a possibility. AND WE MUST ALLOW PEOPLE TO FAIL. To do anything less leads us down the road to socialism. Our government has failed, and the founding fathers are rolling in thier graves Im sure.
 
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