Skip to comments.Forgetting History, Obama Administration Wants To Subsidize More Bad Loans
Posted on 04/04/2013 4:06:04 AM PDT by LD Jackson
History is an important thing. More than just days and the events that occurred, history helps us by giving examples of what happened in the past, why those things took place, and how we can best avoid repeating the same mistakes we have already made. History may be boring to many, but we would be smart to look back to 2008 to see why this next story is so important.
Remember 2008 and how the housing market went south in a hand basket? Because of that, credit dried up, almost completely. Much was said about how companies would be unable to meet their payrolls because their banks would not advance them the credit and the cash they needed to keep their operations rolling and their employees paid. This was all brought on because of the multitude of loans the banks had made to people who had no hope of paying them back. Those loans were made because the federal government had decided that more people should be able to buy their own homes. Never mind that their credit was in the tank. Never mind that their income was far below the requirements. It was good for America, or so we were told.
History tells us that was a crock. Those loans ultimately brought our housing market to its knees and as a result, America went into the worst recession in my lifetime. You should remember the recession because it's the one we are still trying to claw our way out of. One would think we would have learned our lesson from this bit of history, but one would evidently be wrong. The Obama administration wants us to go down that road again.
(The Washington Post) The Obama administration is engaged in a broad push to make more home loans available to people with weaker credit officials say they are working to get banks to lend to a wider range of borrowers by taking advantage of taxpayer-backed programs including those offered by the Federal Housing Administration that insure home loans against default. Housing officials are urging the Justice Department to provide assurances to banks, which have become increasingly cautious, that they will not face legal or financial recriminations if they make loans to riskier borrowers who meet government standards but later default.I can think of a lot of words to describe how stupid I believe this is. Throwing good money after bad, money down a rat hole, and pure idiocy are just a few. I could say I can not believe our government is this stupid, but after watching the Obama administration in action for the past four years, nothing they do surprises me. Here is how Dan Mitchell describes it.
(International Liberty) Lets assume you didnt understand how a garbage disposal worked and, for whatever reason, you decided to stick your arm in one and turn it on. You would do some serious injury to your hand.Even though this push by the Obama administration gives us ample opportunity to show exactly how they are repeating history and gives us plenty of topics to write about, I sincerely hope they will reconsider. The officials Obama has put in charge of this should stop and think about the direction they are going with this. The President himself should look at recent history and realize how this push is likely to end. Instead, I fully expect them to follow through and help the banks dig this hole as deep as they can. And when they are through and we can not see the light of day for the dirt over our heads, they will still be blaming someone else for the disaster they helped create. That's exactly what they did when the housing market collapsed in 2008 and history will almost certainly repeat itself by the time the Obama administration is done.
The rest of us would wonder what motivated you to stick your arm down the drain in the first place, but we would feel sympathy because you didnt realize bad things would happen.
But if you then told us that you were planning to do the same thing tomorrow, we would think you were crazy. Didnt you learn anything, we would ask?
Seems like a preposterous scenario, but something very similar is now happening in Washington. The Obama Administration is proposing to once again put the economy at risk by subsidizing banks to give mortgages to people with poor credit.
Obama does not care a wit.
The rule of holes
When you find yourself in a hole; stop digging.
The only history Omoslem cares about is (i) Making history for islam, and (ii) Making sure the USA “is history.”
Oh, now I understand.
If he wants to back toxic loans, open his own wallet.
After all by the time he gets out of office his few million will have multiplied exponentially.
It is about killing the economy. It is not about poor people.
After four years the author still has not figured out that this administration is not operating with the intention of making things better. He still believes they are "stupid"; in other words misguided. They are neither. They are evil. They are driving us to crisis so that the few checks on their power can be discarded.
stealing more $$$$$, “making it hurt”
They WANT to trash the system, "for social justice".
It’s all part of the Liberal agenda to reduce Americans to a bleeding pulp on the ground.
THEN the Liberals can step in and ‘save’ us with their f’d up Socialist plan...AS IF that kind of BS has EVER worked anywhere on earth!
“Forgetting History, Obama Administration Wants To Subsidize More Bad Loans”
Forgetting History my butt. Once again he, they, the Democrat Party are securing votes for their side using once again our money to do so. It’s S.O.P. for the bastards. It’s the old make us dig our own grave, and then shoot us suckers in the head trick.
The Congressional Hispanic Institute, Inc, is an entity organized by Cong Joe Baca (D-Cali) in his capacity as head of the Congressional Hispanic Caucus.
Cong Baca created "HOGAR" (Spanish for home) in 2003 to work with the mortgage industry, F/M, lenders, banks and latino community groups to increase mortgage lending to what savvy observers consider to be unqualified Latinos.
"HOGAR" colluded w/ Cong Baca in what was to become a massive bilking of taxpayers. Cong Baca calculatedly hyped the fact that the national Latino homeownership rate was 47%, compared with 68% for the overall population.
HOGAR was coached to call the figure "alarming," and to say "a concerted effort was required to ensure that by the end of the decade Latinos will share equally in the American Dream of home ownership."
HOGAR and Cong Baca conned the public, failing to note that most of the "dreamers" were illegals, citizens of Third World countries who had violated US borders.
Predictably, HOGAR colluded w/ co-conspirators which included:
(a) shaky mortgage companies that ran into big trouble;
(b) Fannie Mae and Freddie Mac, both now under federal control after billions in taxpayer bailouts;
(c) Countrywide Financial Corp., sold to Bank of America Corp;
(d) Washington Mutual Inc., taken over by the US government and sold to J.P. Morgan Chase & Co.; and,
(e) New Century Financial Corp. and Ameriquest Mortgage Corp, both now defunct, killed by defaulted subprime Latino mortgages.
HOGAR's ties to the subprime mortgage industry were substantial. Bribery and self-dealing were rampant:
<><> Companies that donated $150,000 to Cong Baca got the right to have their own research fellow who would conduct fraudulent studies, which were cunningly used by industry lobbyists to pump lending.
<><> Bribery and extortion in the form of $100,000 annual donations to Cong Baca, for which HOGAR provided phony news releases from Cong Baca's Hispanic Caucus promoting a lender's commercial products to the Latino market,
<><> The most shocking example of bribery well-substantitated by Hogar's literature..... HOGAR announced it worked with Freddie Mac on a self-serving two-year examination of Latino homeownership in 63 congressional districts.
The "study" found Hispanic ownership on the rise thanks to "new flexible mortgage loan products" that the industry was adopting at the urging of Cong Baca's collusive coterie.
<><> HOGAR conned lenders into even more lenient down-payment and underwriting standards.
<><> As the subprime debacle unfolded, HOGAR declined repeated requests for comment despite the economic havoc their activities precipitated.
The mortgage schemes demonstrated the criminal activities of border violators with multiple identities---perhaps violent, terrorist-connected foreigners---colluding and conspiring to defraud private companies and public entities. And mortgage racketeering enterprises which employed sub rosa finance and business practices to carry out deceptions and frauds.
The alleged ring of swindlers---a Congresman, individuals with multiple identities, banks, insurance companies, mortgage brokers--might be charged with cheating the US govt, taxpayers and bank share holders out of hundreds of millions of dollars via an elaborate web of mortgage and bank frauds.
The mortgage Dreamers used multiple phony identities, fraudulent Social Security numbers, purchased from identity forgers in order to obtain govt-subsidized benefits.
L/E will find that individuals with multiple identities obtained fraudulent mortgages then flipped the houses at ever-higher prices to family member who then absconded to foreign countries, sticking banks (and taxpayers) with hundreds of millions in fraudulent mortgages.
BACKGROUND A Wall Street Journal investigative report related that, according to the Federal Financial Institutions Examination Council examination of the borrowing spree, uncovered financial schemes by low-income housing groups, Hispanic lawmakers, a congressional Hispanic housing initiative, mortgage lenders and brokers, all colluding in fraduent schemes to increase homeownership among Latinos with forged documents which enabled massive fraud.
This was not simply the mortgage market at work. It was fueled by avarice, greed, and Congressional enabling fraudulent practices. In 2005 alone, mortgages to Hispanics jumped by 29%; Latinos with multiple fraudulent identities in low-paying jobs obtained subprime mortgages for prime properties---soaring to 169%.
(Research provided by Wall Street Journal. Some material excerpted from the NY Times).
This is an obvious absurdity. Forcing banks to make bad loans only rebuilds the house of cards, jeopardizing the banks. We do not need a “home” for everybody. They can rent. My grandfather never owned a home. Two of my uncles never owned a home. It’s utterly ridiculous.
Excerpt ...Ten years ago the typical conforming mortgage required a down payment of 10-20%, and low-down payment mortgages were considered too risky. But then we helped to standardize the 3-5% down payment loan, brought it to global capital markets, and made it available to lenders and communities nationwide. Now low-down payment loans are commonplace. And we just adopted a new variance in our underwriting standards that will make the $500 down payment loan widely available as well...
In 1994, we pledged to provide $1 trillion in capital to ten million underserved families by the end of 2000. Thanks to our housing and industry partners, we met that goal early.
Then in 2000, we launched our American Dream Commitment, a pledge to provide $2 trillion in capital to 18 million underserved families by the year 2010, including $400 billion targeted specifically for minority families (later raised to $700 billion in response to President Bushs Minority Homeownership Initiative). After four of the strongest years in housing and mortgage finance history, weve already surpassed the top-line goals of this commitment. But our work is far from complete.
So in January 2004, we announced our Expanded American Dream Commitment and pledged significant new resources to tackle Americas toughest housing challenges. Our new commitment has three main goals.
First, we will expand access to homeownership for six million first-time home buyers in the next ten years, including 1.8 million minority first-time home buyers.We also will help raise the national minority homeownership rate from 49 percent to 55 percent, with the ultimate goal of closing it entirely.
Second, we will help new and long-term homeowners stay in their homes through a series of initiatives, and commit $15 billion to preserve affordable rental housing and $1.5 billion to support the revitalization of public housing communities.
Third, we will increase the supply of affordable housing and support community development activities in at least 1,000 neighborhoods across the country through our American Communities Fund, and through targeted investments like Low-Income Housing Tax Credits that help finance affordable rental housing.
It is because of initiatives like our Trillion Dollar Commitment and our American Dream Commitment that we have exceeded our HUD affordable housing goals for ten consecutive years. (End Raines excerpt.) (NOTE Raines is a Clinton appointee)
FRANKLIN RAINES----THE BIG F/M FISH THAT GOT AWAY WITH A BUNDLE
The Office of Federal Housing Enterprise Oversights report says that F/M CEO Franklin Raines---a Clinton appointee---and other Fannie Mae bigwigs, deliberately and intentionally manipulated financial reports to artificially hit earnings targets in order to trigger multi-million dollar bonuses for senior F/M executives.
Ex-Fannie CEO Franklin Raines should be behind bars for life. He is a crook of the first order. This thief Raines cooked the FM books precipitating losses of $9B (that we know of) for the single purpose of creating bonuses for himself and other F/M insiders. The SEC said Raines broke accounting rules by playing with risky derivatives.
RAINES COOKS THE F/M BOOKS---WALKS AWAY A MULTI-MILLIONAIRE After Raines was fired and exposed as a fraudster for cooking the govt books, Raines walked away w/ $90 million dollars, a $26 million parachute, PLUS..... Raines gets a MONTHLY pension of $116,300 for life. Raines had already collected $4.87 million in "special performance" shares. Raines owns options giving him $5.8 million in net profit after redemptions, plus another $8.7 million in deferred compensation for his six years at the F/M helm. There's more.
Raines keeps $5 million of paid-up life insurance. He and his spouse get free medical and dental benefits for life, worth over $1 million. NOTE: Raines earned $20 million in salary, bonuses and stock awards (that we know of) in one year.
To keep Raines happy within philanthropic circles, Fannie Mae will match Raines' charitable contributions by $10,000 a year.
After he was fired, Raines told the F/M board that he's entitled to get paychecks until June 22 giving him another $600,000, which triggers a $2,000 monthly rais
Fannie/Freddie are centerpieces of the criminal enterprise called the Democrat Party-where Dem cronies and collaborators loot the organization, get cushy jobs, bonuses, and the like.
Fannie Maes political machine dispensed campaign contributions, gave jobs to friends and relatives of legislators, hired armies of lobbyists (even paying lobbyists not to lobby against it), paid academics who wrote papers validating the home ownership mania, and spread charitable contributions to housing advocates across the congressional map.
Fannie Mae serves as an industrial-sized patronage factory sharing profits with political allies, spreading taxpayer funds to voting blocslike ethnic groups-and doling out jobsto left-wing academics, Washington has-beens and back-scratching buddies.
Obama insider Fannie Mae exec Jim Johnson got sweetheart loans from shady subprime Countrywide. Pols raked in six-figure salaries as F/F engaged in Enron-style accounting, plunged into debt and helped usher in the subprime housing meltdown through cockamamie lending practices.
Bill Clinton appointed Franklin Raines, Daley and Rahm Emanuel just as the quasi-governmental F/M engaged in rampant book-cooking so that F/M insider could help themselves to massive bonuses.
The Chi/Tribune exposed how political whore Rahm Emanuels profitable stint was low-show w/ no work involved. Emanuel was not even assigned to committees, according to company proxy statements. Immediately upon joining the board, Emanuel and other insiders qualified for $380,000 in stock and options plus a $20,000 annual fee, public records indicate. W/ Wall Street Rahm Emanuel at F/M, accounting tricks were used to mislead shareholders about outsize profits F/M reaped from risky investments.
The goal was to cook the books to keep fraudulent earnings on the books, to make Freddie Mac look profitable on paper-AND to fraudulently obtain humongous annual bonuses for political insiders.
---SNIP---In 1993 President Bill Clinton appointed Andrew Cuomo to the Department of Housing and Urban Development (HUD) as Assistant Secretary. (NOTE Cuomo is now NY governor and prez wannabe---has $22 million warchest.)
In 1997 Cuomo took over as HUD chief replacing Clinton appointee Henry Cisneros. During Cisneros tenure he championed Clinton's goal of social engineering within the housing market forcing lenders to issue loans to those that would not financially qualify for the lending.
Cisneros left office in a scandal involving lying to the FBI over payouts to a mistress, Cisneros subsequently pleaded guilty to a misdemeanor and though never sent to prison received a pardon from Bill Clinton in 2001.
Andrew Cuomo took the HUD reins and not only furthered Cisneros and Clinton's policies but greatly expanded them.
Henry Cisneros moved the GSEs toward a requirement that 42 percent of their mortgages serve low and moderate income families. Andrew Cuomo raised that number to 50 percent and dramatically hiked GSE mandates to buy mortgages for the "very-low-income."
These bad loans were purchased and sold throughout the secondary market and the pyramid grew and the bottom collapsed resulting in the subprime crisis we are still reeling from today.
In 2008, the Village Voice published a compelling report detailing Andrew Cuomo's policy decisions "that gave birth to the country's current crisis."
The report touched on how Cuomo's 187-page rules "opened the door to abuse." The rules explicitly rejected the idea of imposing any new reporting requirements on the GSEs. In other words, HUD wanted Fannie and Freddie to buy risky loans, but the department didn't want to hear just how risky they were.
Many New York voters have been distracted by the gubernatorial candidate Carl Paladino's racist joke email forwards, what some are failing to see is the actual harm to the minority community directly caused by Cuomo's policies...and that is no laughing matter.
Cuomo's top aide said, "We believe that there are a lot of loans to black Americans that could be safely purchased by Fannie Mae and Freddie Mac if these companies were more flexible." Andrew Cuomo doubled down and had this to say about his HUD standards, "GSE presence in the subprime market could be of significant benefit to lower-income families, minorities, and families living in underserved areas."
How's that working out for the minority community, where foreclosures and unemployment rates have hit the hardest as a result of such failed policies and blatant social engineering?
SOURCE http://voices.yahoo.com/cuomos-social-engineering-as-hud-chief-contributed- 7077218.html
Almost as soon as the mortgage crisis started, you had politicians bemoaning the fact that people who couldn’t afford loans wouldn’t be able to get them.
I put these in the same category as those who bemoaned Islamaphobia within 2-3 weeks of 9/11.
Impeachment File on B. Hussein Obama, aka Barry Soetoro.
He’s ran out of criseses to cause now he has to use the old ones.
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