patrick.net

E-man says

I watched the hearing today. Our Senators are so stupid that they make Goldman Executives look good. I couldn’t believe we voted for these clowns to run our country, or maybe, just maybe, Goldman is running our country behind the scene :o)

The hearing was an example once again, that Congress, over populated with lawyers, is clueless regarding how finance and US business work. Goldman with their short showed they were not going to be teamplayers with governments failing housing policy any longer. That is what the hearing was about.

You might as well have Maxine Waters threating corporate CEOs with nationalization if they dont follow governments left wing social agenda.

CSC says

For that matter, why did bloggers know about GOldman years ago but the media’s acting like it just happened? Corporations have way too much control of both govt and media. The American people are mostly in the dark, and corporate powers are at work to make the internet as dumbed down as TV as we speak. I hope this pattern can be broken before the last bastion of free flowing information is also destroyed.

The media is full of anti-corporate types anyway. Did it ever occur to you that it wasnt corporations controlling media but many in the media itself and government with a social political agenda pushing on banks to make risky loans. If they didnt follow the government agenda on housing policies they get hit with boycotts and government anti-disrimination lawsuits. Isnt that what we been seeing since the mid 90s?

thomas.wong1986 says

The media is full of anti-corporate types anyway. Did it ever occur to you that it wasnt corporations controlling media but many in the media itself and government with a social political agenda pushing on banks to make risky loans. If they didnt follow the government agenda on housing policies they get hit with boycotts and government anti-disrimination lawsuits. Isnt that what we been seeing since the mid 90s?

Actually, no it's not. This theory has been completely debunked here on several other threads.

I watched the Senate hearings on C-SPAN3 last night. At first I was against GS, but after listening to our Senators doing their on-the-air politics, I supported GS. I think the government should be more worried about Fannie and Freddie.

thomas.wong1986 says

CSC says

For that matter, why did bloggers know about GOldman years ago but the media’s acting like it just happened? Corporations have way too much control of both govt and media. The American people are mostly in the dark, and corporate powers are at work to make the internet as dumbed down as TV as we speak. I hope this pattern can be broken before the last bastion of free flowing information is also destroyed.

The media is full of anti-corporate types anyway. Did it ever occur to you that it wasnt corporations controlling media but many in the media itself and government with a social political agenda pushing on banks to make risky loans. If they didnt follow the government agenda on housing policies they get hit with boycotts and government anti-disrimination lawsuits. Isnt that what we been seeing since the mid 90s?

How many anti-discrimination have there been? I've only seen a couple, which were wisely (the banks were clearly redlining) settled. Was this really a pervasive problem? Why were the biggest RE booms in the upscale area's least affected by the community reinvestment act if this were true?

I seem to remember the media playing up the financial industry when the party was in full swing. King's of finance, the new economy, and all that stuff. I think the media is full of story of the day people who just jump on the current trend, whatever it is.

tatupu70 says

Actually, no it’s not. This theory has been completely debunked here on several other threads.

Oh really! Does very little in the real world buddy! The media is run by idiots chasing stupid stories only soccer moms are interested in.

jvolstad says

I watched the Senate hearings on C-SPAN3 last night. At first I was against GS, but after listening to our Senators doing their on-the-air politics, I supported GS. I think the government should be more worried about Fannie and Freddie.

The government largely ignored any and all problems at the GSEs back some years ago.
But see for yourself.... http://www.youtube.com/watch?v=_MGT_cSi7Rs

bob2356 says

Why were the biggest RE booms in the upscale area’s least affected by the community reinvestment act if this were true?

Define upscale and regions ?

thomas.wong1986 says

Oh really! Does very little in the real world buddy! The media is run by idiots chasing stupid stories only soccer moms are interested in.

huh? I'm not sure what you are trying to say there Thomas. The media caters to the general public. In a free market, they provide what people will buy.

But what does that have to do with your inaccurate post about the government pressuring lending institutions to make risky loans?

tatupu70 says

But what does that have to do with your inaccurate post about the government pressuring lending institutions to make risky loans?

http://www.youtube.com/watch?v=iW5qKYfqALE&feature=related.

Fannie Mae Eases Credit To Aid Mortgage Lending
By STEVEN A. HOLMES New York Times
Published: September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets — including the New York metropolitan region — will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates — anywhere from three to four percentage points higher than conventional loans.

”Fannie Mae has expanded home ownership for millions of families in the 1990’s by reducing down payment requirements,” said Franklin D. Raines, Fannie Mae’s chairman and chief executive officer. ”Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.”

Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 per cent of loans in the conventional loan market.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.

”From the perspective of many people, including me, this is another thrift industry growing up around us,” said Peter Wallison a resident fellow at the American Enterprise Institute. ”If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.”

Under Fannie Mae’s pilot program, consumers who qualify can secure a mortgage with an interest rate one percentage point above that of a conventional, 30-year fixed rate mortgage of less than $240,000 — a rate that currently averages about 7.76 per cent. If the borrower makes his or her monthly payments on time for two years, the one percentage point premium is dropped.

Fannie Mae, the nation’s biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.

Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites.

Home ownership has, in fact, exploded among minorities during the economic boom of the 1990’s. The number of mortgages extended to Hispanic applicants jumped by 87.2 per cent from 1993 to 1998, according to Harvard University’s Joint Center for Housing Studies. During that same period the number of African Americans who got mortgages to buy a home increased by 71.9 per cent and the number of Asian Americans by 46.3 per cent.

In contrast, the number of non-Hispanic whites who received loans for homes increased by 31.2 per cent.

Despite these gains, home ownership rates for minorities continue to lag behind non-Hispanic whites, in part because blacks and Hispanics in particular tend to have on average worse credit ratings.

@thomas

Have you followed any of the previous threads on this issue? I don't want to delve into the details again, but it has been shown pretty conclusively that this theory is wrong. And what does a link to Barney Frank have to do with your contention at all?