Another Billion-Dollar US Company Just Moved Across The Pond

[Hatz]

Really.

 

Clinton had mainly a democrat controlled house and senate during his presidency. After 2007, Bush had a democrat majority.

 

Don't let the facts confuse a good storyline though.

 

What, in the first sentence above is true?

 

What do you call the last sentence?

 

Even by your own statement in that post the quotas were raised in '96, '97 and '00 - All times when Congress was NOT controlled by the Democrats as you assert at the end of your post.

[doomer]

Even by your own statement in that post the quotas were raised in '96, '97 and '00 - All times when Congress was NOT controlled by the Democrats as you assert at the end of your post.

 

The seeds for that meltdown were sown in the mid-nineties during the Clinton administration BTW.

 

Effective in January 1993, the 1992 housing bill required Fannie and Freddie to make 30% of their mortgage purchases affordable-housing loans. The quota was raised to 40% in 1996, 42% in 1997, and in 2000 the Department of Housing and Urban Development ordered the quota raised to 50%. The Bush administration continued to raise the affordable-housing goals. Freddie and Fannie dutifully met those goals each and every year until the subprime crisis erupted. By 2008, when both government-sponsored enterprises collapsed, the quota had reached 56%. An internal Fannie document made public after the financial crisis ("HUD Housing Goals," March 2003) clearly shows that by 2002 Fannie officials knew perfectly well that these quotas were promoting irresponsible policy: "The challenge freaked out the business side of the house [Fannie] . . . the tenseness around meeting the goals meant that we . . . did deals at risks and prices we would not have otherwise done."

 

Phil Gramm and Michael Solon: The Clinton-Era Roots of the Financial Crisis - WSJ

 

 

Clinton had mainly a democrat controlled house and senate during his presidency. After 2007, Bush had a democrat majority.

 

Don't let the facts confuse a good storyline though.

 

Here is my post. It responds to another poster linking the 2008 meltdown only to the Bush presidency. I have read it several times, and it seems to adequately clarify the beginning of the issues that allowed for the meltdown. I have not argued any later posters who add that the practice of supporting subprime loans continued on both sides of the aisle for more than a decade.

 

I have trouble understanding what point you try to make.

[75center]

Even by your own statement in that post the quotas were raised in '96, '97 and '00 - All times when Congress was NOT controlled by the Democrats as you assert at the end of your post.

 

Who raised the quotas? I'm really not sure if i'ts a congress action or a department action. If it's a congress action those are all on the republicans, if it's a department action that's all on Clinton.

[75center]

Who raised the quotas? I'm really not sure if i'ts a congress action or a department action. If it's a congress action those are all on the republicans, if it's a department action that's all on Clinton.

 

Went and looked it up, the quotas were established by the democrat congress led by Barney Frank in 1992 under Bush 1. Then HUD was given authority to administer quotas and they were raised from 30 to 50% under Clinton and Bush took them to 55%. As I said, bi-partisan effort on this one.

[Hatz]

The seeds for that meltdown were sown in the mid-nineties during the Clinton administration BTW.

 

Effective in January 1993, the 1992 housing bill required Fannie and Freddie to make 30% of their mortgage purchases affordable-housing loans. The quota was raised to 40% in 1996, 42% in 1997, and in 2000 the Department of Housing and Urban Development ordered the quota raised to 50%. The Bush administration continued to raise the affordable-housing goals. Freddie and Fannie dutifully met those goals each and every year until the subprime crisis erupted. By 2008, when both government-sponsored enterprises collapsed, the quota had reached 56%. An internal Fannie document made public after the financial crisis ("HUD Housing Goals," March 2003) clearly shows that by 2002 Fannie officials knew perfectly well that these quotas were promoting irresponsible policy: "The challenge freaked out the business side of the house [Fannie] . . . the tenseness around meeting the goals meant that we . . . did deals at risks and prices we would not have otherwise done."

 

Phil Gramm and Michael Solon: The Clinton-Era Roots of the Financial Crisis - WSJ

 

 

Clinton had mainly a democrat controlled house and senate during his presidency. After 2007, Bush had a democrat majority.

 

Don't let the facts confuse a good storyline though.

 

Here is my post. It responds to another poster linking the 2008 meltdown only to the Bush presidency. I have read it several times, and it seems to adequately clarify the beginning of the issues that allowed for the meltdown. I have not argued any later posters who add that the practice of supporting subprime loans continued on both sides of the aisle for more than a decade.

 

I have trouble understanding what point you try to make.

 

Clinton had mainly a democrat controlled house and senate during his presidency.

 

The last part of your post was not a quote. And if you are trying to argue where the quotas came from, why mention the above sentence at all unless you are looking for placing blame. The statement is not only false, it has no bearing to the above.

[Bluegrasscard]

It was a party when it came to housing. Everyone was making money and getting political points (rate of home ownership that even Bush bragged about early in his time as President.)

 

Even I was going to join the party after building a house in 2006 and saving money GCing it. I was going to fund it via HELOC. The nice bank was willing to loan out a HELOC equal to 100% of (probably artificially high looking back) appraised value. Thus it was possible to use your house to .... become a builder and build another house or 2. Luckily I procrastinated long enough to not get caught in the 2008 fun. But that is how loose lending was back then.

 

As with sports - winning (or in this case making money) covers a lot of sins. Until the winning stops or the making money stops. Had it just been the loose real estate money we still would have a housing bubble and a pretty sever housing correction. But it would have been a more normal boom/bust cycle. The addition of derivatives and hedge funds made it far worse. And the SEC was way behind on regulating these new things - again when the party is going why slow it down.

 

Things were real good during the Clinton years, and after the shock of 9/11 wore off the party was going again under Bush. The Fed was created to keep this from happening - it didn't. Sarbanes-Oxley was supposed to help stop this - it didn't. TBTF banks were supposed to be responsible enough to stop this - they were not. Seems all the financial policies of the last century failed. But who benefits from the policies? The answer is probably on the logos in your wallet - BofA, Chase, etc. That is where more of the 'blame' should be directed. And these people have deep hooks into both parties.

[Getslow]

^ Great stuff. Absolutely agree.

 

To paraphrase Hayek: it's not the bust, but the boom you should fear.

[UKMustangFan]

Whenever people complain about the taxes (or lack there of) paid by corporations, I like to ask them if they itemize on their individual returns. If they do, I forever ignore them as hypocrites.

[doomer]

Clinton had mainly a democrat controlled house and senate during his presidency.

 

The last part of your post was not a quote. And if you are trying to argue where the quotas came from, why mention the above sentence at all unless you are looking for placing blame. The statement is not only false, it has no bearing to the above.

 

You are right, during the majority of Clinton's presidency, there was a republican majority in the house in senate. In 1993 to 1995, when this practice first became allowable, it was a democrat majority. I mention that ONLY to dispel the liberal myth that loves to blame the economic crisis of 2008-9 only on the administration at that time which is overly simplistic and incorrect IMO.

 

Bill Clinton was the 42nd president of the united states. This period was 1993 through to 2001. Apart from 1993 to 1995 which was controlled by the democrats, the republicans controlled the house and senate till 2001.

What political party controlled the house and senate during the Clinton years

 

I guess if you are a black/white kind of person, if I defend the Republicans, as I did, then I am blaming the Democrats? Sorry, I don't see things that way.

 

And actually, my recollection of the Clinton years is that the fact that there was not a consensus of democrats in the executive and legislative branches for most of his administration prevented us from making a bigger mess of things. Wasn't Hillary put in charge of national health care during his reign?