Conservatives like blaming black people.

"But you would think that amidst a bona fide emergency situation whose consequences threaten everyone's well-being that conservatives would try to pay some attention to what's actually going on."

Um, no, actually I wouldn't. I've seen them work before.

Yeah it'd be just like if after a major terrorist attack on our soil Republicans went after a country that had nothing to do with the attack...

"You expect a certain amount of dishonesty in politics. But you would think that amidst a bona fide emergency situation whose consequences threaten everyone's well-being that conservatives would try to pay some attention to what's actually going on."

Why do you guys keep giving these morons the benefit of the doubt, that they have operating frontal lobes?

Of course they're going to say whatever they can to promote their white supremacist world view and their vision of theocratic fascism.

In 2004, HUD pressured Fannie/Freddie to increase low income loans from 50% to 56%. In the housing credit market at that time, that necessarily meant more subprime loans. By buying some of these loans from other banks, it freed more capital to make even riskier loans, while using F&F as a garbage recepticle.

Come on, you expect Republicans to behave any differently? After 9/11 they didn't unify the country, they used the attacks as a wedge to further tax cuts and to futher demonize democrats.

Furthermore... Fannie/Freddie had rules against buying mortgages from lenders/brokers that had high loan-to-value ratio or met their definition of a "jumbo"-sized loan. It was the private market that was offering no-money-down, variable rate, balloon loans to people with "stated income".

The years of investigations necessary to bring those responsible for this collapse to the justice of that responsibility can only come about if the collapse either takes place or is successfullt prevented, which is why the don't-give-a-damn Bushylvanians---and their standard-bearing lackey McCain---are so desperately desperate to affix the blame where it least belongs, while doing absolutely nothing to fix the problem as they call for the rest of the financial world to "not be hasty" in effecting a solution.

Such is the case, when the bloodthirsty discover that the blood they smell in the water is their own. They suddenly develop an allergy to blood and water both.

Of the two options---successful prevention or permitting the collapse---I'm of the mind that the collapse should be permitted to occur, as it is the only recourse that will successfully change how the world conducts its financial business in the future, while guaranteeing the overt wrath that will force final justice to be meted out against those responsible for the profiteering crimes committed in the names of Capitalism and Free Enterprise.

Just watched Press the Meat, and it was rather infuriating.

Yes, they accurately pointed out that a majority of the country has been on a credit binge for the past seven years, and took the candidates to task for not lecturing us all on our poor impulse control.

What they didn't say is that a large portion of the people who are in over their heads got there by using credit to keep up with paying for basic necessities - food, clothing, gasoline, home heating, health care - which have all skyrocketed in price during the same period. Which we should note was a period in which we saw a 20% increase in productivity, while wages remained static or went down. Because of course a basic understanding of that fact would lead to the inescapable conclusion that one of the candidates has a tax and health care plan that addresses real economic issues, while the other does not.

Human Shield (from Fox News)

A carpet was laid down and Palin, dressed in a beige trench, walked on to the ice joined by her daughters Willow and Piper. The GOP Vice-Presidential nominee said at an earlier fundraiser that she would stop some of the booing from the rowdy Philadelphia fans by putting her seven year old daughter, Piper in a Flyers jersey. She said, “How dare they boo Piper!”

No it wasn't just Fanny and Freddy. It was also the investment dealers from blue-state New York and their international banker friends.

investment dealers from blue-state New York -Al

That's good, Al. And I guess the Wall Street Journal and Washington Times are liberal rags.

Al, blue state NY, had, until the previous election, a Republican governor, and republican controlled legislature. It still has a republican controlled legislature. So take your democratic blame and shove it. You think this is all the dems fault? Learn a little bit about local geographical political affiliation, it might help you make better arguments.

If you really want to get a sense of the scale of the leverage on CDOs and financial company debt (imho the real reason for the issues we're dealing with), check this out:

http://www.thedeal.com/servlet/Satellite?pagename=webreprint&c=TDDArticle&cid=1223252367230

"According to one estimate, the number of CDS contracts outstanding reference Lehman debt worth about $400 billion. That notional amount exceeds the $110.5 billion in senior unsecured notes, the $12.6 billion of subordinated unsecured notes and about $5 billion of junior subordinated notes Lehman had outstanding at the end of May, because buyers of CDS contracts don't have to own the underlying bonds, allowing the value of the contracts to multiply far beyond the value of the debt."

So there are 4x CDSs on the Lehman debt compared with the actual debt. This article also points out, indirectly, that come Monday some sellers of CDSs are going to have to come up with $350b to meet their obligations. Who beats whether they will or not?

Al, still the comedian grasping at staws. That titanic sure looked purdy when it left the port, eh?

Got my VW..I'm gonna drive up to NY and collect me all of those Democratic investment bankers and give both of them hell..just to please Al

can we now agree that the reason McCain and other repubs were pushing for more regulation of Fannie and Freddie was because they wanted to eliminate wall street's competition?

Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication. One reason is that Fannie and Freddie were subject to tougher standards than many of the unregulated players in the private sector who weakened lending standards, most of whom have gone bankrupt or are now in deep trouble.

more regulation for fannie and freddie would have meant greater market share for wall street banks that weren't subject to regulation.

in that sense, the Repubs' push back against Fannie and Freddie is doubly brilliant. they weren't warning about the GSEs because they wanted LESS subprime lending. they were warning against them because they thought they had an unfair competitive edge against the unregulated players on wall street.

Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 -mercurino

True, and yet F&F bought $81B in subprime loand in 2003, $175B in '04 (44%), $169B in '05 (33%) and $90B in '06 (20%). It would be interesting to see what these numbers would have been had HUD not required an increase in the percentage,/b> of low income loans.

It was also the investment dealers from blue-state New York and their international banker friends.
Al

A simple rewrite gives us this:

Germany was defeated from within by the profiteers, the Communists, and the international Jewish community.
Adolf Hitler, Mein Kampf.

Sell it elsewhere, allie m'boy. We thrashed your type into the mud in 1944/45---and we'll most certainly do it again, if and when the time comes.

One thing that is suspicious to me is that Republicans were unable to "regulate" Fannie & Freddie. Why would they want to do that, and why did they fail? Is it possible that they just wanted to stomp their feet a little at a "government" agency, or maybe even knee-cap the competition? I'm not sure we know the story behind this effort.

There is a Federal Reserve Bank of Boston report from this past spring that makes the same case. (The McClatchy writers don't say so, but it sounds as if this might be one of their sources.) The lion's share of sub-primes went to borrowers with FICO scores above 620, or the level at which one ordinarily qualifies for a prime loan.

The paper's authors also note that a large percentage of those loans were for "investment," "rental," or "flip" properties -- in other words, properties held by owners of other property and, therefore, the ones most likely to walk away in the event (as happened) of declining property values.

And they note that a good-sized percentage were from refinancing activities (i.e., not first-time "unqualified" borrowers, per the conservative hate talking point).

Everybody knows that the financial meltdown is because democrats forced banks to loan money to n*gg*rs & sp*cs!

Why do you dumbocrap mouthpieces continue to promote class warfare against the wealthy who are the economy of our country? Fortunately, our respected republican leaders and their centrist allies in the dumbocrat party understand that our economy can afford to let the poor and the working poor fail economically. What we cannot afford is to let the wealthy lose too much or our economy will completely tank. Your hero Bill Clinton understands this - why can't you?

Why do you mealy mouthed jerks attack Sarah & John for pointing out that 'his arrogance' is a n*gg*r who supports domestic terrorists? Your worship of the terrorist affiliated elitist is disgusting!

It is not too late for you to repent! Abandon your terrorist supporting ways and join the McCain bandwagon as good white Americans take back control of our government from the commies Pelosi & Reid.

Join your local 'SWW for McCain' organization and work to save our country!!!

Its also true that many people had good enough credit scores and didnt need a sub-prime loan and were guided to the high interest loans by realtors and mortgage lenders. Quite a few made the mistake of walking into the wrong [sub-prime] office.

And since many mortgages are now underwater people [which arent sub prime] are walking away from their homes.

OK, Steve W has already covered this but I can't leave it alone - New Yorkers and their international banker friends? Yeah. Is this really the strategic feint you want to make, Al? "IT'S THE BLACKS. WAIT I MEAN IT'S THE JEWS."

But back in the real world, I don't think this is working. The economic pain is too wide and deep for people to be suckered into thinking the sole cause of the problem is that there are those funny looking people over there.

One thing that is suspicious to me is that Republicans were unable to "regulate" Fannie & Freddie. Why would they want to do that, and why did they fail? Is it possible that they just wanted to stomp their feet a little at a "government" agency, or maybe even knee-cap the competition? I'm not sure we know the story behind this effort.--tomj

this is what i want to know as well. somehow i don't think repubs' issues with fannie and freddie were driven by concerns that they were buying questionable loans. rather, i think the problem was that their implicit government guarantee gave them a competitive edge against the wall street banks who were securitizing subprime loans. does anyone doubt that lobbyists for wall street firms were pushing repubs in congress to eliminate the "unfair" competition of the GSEs?

Republicans have to fight this reality to their very last fiber. What do they have left?

Republicans are poor at governing - look at the deficit, look at our infrastructure.

Republicans cannot win wars or defend the country - where is OBL? How is Afghanistan, Iraq?

Republicans are bad at business - the world economy was driven off a cliff by Republicans.

So what's left?

Republicans tell big lies.

True, and yet F&F bought $81B in subprime loand in 2003, $175B in '04 (44%), $169B in '05 (33%) and $90B in '06 (20%). It would be interesting to see what these numbers would have been had HUD not required an increase in the percentage,/b> of low income loans.--danp

one question one comment:

1. where did you get this data?
2. there's a difference between "low income" and "subprime" loans. the interest rate is what determines whether a loan is "prime" or "subprime"; high income earners can get "subprime" loans and low income earners can get "prime" loans. this is a crucial point. the mcclatchy article makes this explicit:

In a book on the sub-prime lending collapse published in June 2007, the late Federal Reserve Governor Ed Gramlich wrote that only one-third of all CRA loans had interest rates high enough to be considered sub-prime and that to the pleasant surprise of commercial banks there were low default rates. Banks that participated in CRA lending had found, he wrote, "that this new lending is good business."

high rates of default are occurring on subprime loans. this doesn't meant that the people defaulting on the loans are "low income."

I lost any hope long ago that right winge Republicans are willing to change their minds based on FACTS.

While I enjoyed the McClatchy article, (not that it matters, but I worked on Wall Street until recently and it's accurate), let's not fool ourselves that it changes things in any way.

Fox, Limbaugh, Savage, Hannity et al will continue to peddle the "Acorn/scary black/brown people caused the meltdown" until it suits them to change it to "ACLU/communists/yellow people" caused it.

Haven't we learned after 8 years of Bush that facts don't matter to Republicans?

This is just amazing! What stupid analysis. This just shows how you can make any argument it you a liberal aimed with the internet and statistics. Because 84% of the loans issued in 2006, its not a fault of CRA or Fannie and Freddie.

Look, before the expansion of the CRA and the guarantees of Fannie and Freddie, no one would make these loans. Then the expansion of the CRA came along and opened the sub-prime market.

What a surprise, private lending institutions had to come into the market. People have to compete in the world that the market makes. When an unfair advantage is created by guaranteeing sub-prime loans, private lending institutions have no choice but to compete. I'll try to make it simple.

Institution A ( a regulated bank ) makes guaranteed subprime loans. It has a much bigger field to give loans to. Flush with cash from guaranteed subprime loans, it can offer all kind of incentives for more capital to be given to it. Private lending institutions capital dries up because the investors are going for the subprime boom. Can't you see its a lousy expectation for the market not to become flush with subprime lenders. Are democrats really dumb enough to believe they can offer their secret little well regulated programs without effecting the rest of the market.

The blame is to those who
1. set up the subprime market.
2. continued looking the other way so the subprime market could dominate.

I used to have respect for Yglesias, but he has been really ignorant about this.

Earlier this decade Ron Susskind warned all of us about the Republican penchant for viewing facts as falsehood and falsehood as facts, with Republicans (not of the "reality-based community) living in their own La La Land.

We have all seen and borne the bitter fruit of this insane Republican mindset.

I could make a long, long list of all the insanity our nation has been subjected to by BushCo and the Republicans (going back decades, peaking in the past eight years), but the sub-prime lending meltdown ranks right up there with the 9/11 attacks, the Iraq War, Hurricane Katrina and the Republican stealing of elections.

The Republicans wanted to build-up their partisan Republican voter base (to assure a permanent Republican majority) so they hit upon the strategy of artificially increasing home ownership...based on the premise that home owners tend to be more conservative and would likely vote for Republicans once they had a long-term mortgage.

So, Bush starts talking up an "ownership society" in 2001. Then, the Republicans both in the Bush administration and on Wall Street start relaxing long-established lending rules, opening the door to a whole lot of risky home ownership loans, which were then rebundled into investment packages which were then sold to unsuspecting investors around the world.

So, like everything that has happened over the past eight years, this market meltdown is directly attributable to this alternative, corrupt, devious, greedy Republican mindset, in which our country isn't first, but last in their evil, selfish, partisan calculations.

This is just amazing! What stupid analysis.

No, THIS is stupid analysis:

This economy is going really well, and only those who want to find some reason to not think that worry that the supper rich are getting richer.

Posted by: John Hansen on October 29, 2006 at 1:13 AM | PERMALINK

The feeling of pessimism in the country is due to a overwhelmingly liberal press which irrespective of the true statistics seeks to downgrade the economic news when a Republican is in office - something conservatives are against.

Posted by: John Hansen on April 28, 2006 at 12:03 PM | PERMALINK

You are a thoroughly discredited jackass. Toddle off now.

Good job trex, don't address the argument, attack the person, can you say ad hominem.

I stand by those statements as the country looked in 2006. Now do you really want to address my arguments or do you just want to hurl insults.

John, see Mercurino 1:02PM. Poor people in previously redlined districts did not drive the housing bubble. Unless you can provide evidence showing that previously redlined urban areas experienced proportionately larger increases in home prices on the way up and proportionately higher default rates on the way down as a result of lending by CRA-regulated commercial banks, then you would have an argument. Right now you just have claims.

Almost every report I've seen places the blame for the mortgage meltdown totally on deregulation and sub-prime loans.

What I don't read is with the 2 million job losses in the last twelve months, is how many people lost their home not because they borrowed more than they could afford at the time, but because the company they worked for closed and the pay from the replacement jobs they had to take doesn't pay enough to pay the bills.

I stand by those statements as the country looked in 2006

Any person with an ounce of self-awareness and integrity would say: "Man, you liberals have been proven right, and in a big way. You looked at the data and saw it coming and I was simply too dim to connect the dots. You have me dead to rights."

You stand by your analysis in 2006?!? What a joke! People have been warning since 2004 that housing was going to melt down. All you had to do was LOOK AT THE FACTS and not be a partisan brown shirt to see it. Do you not understand the part where, when you've been proven empirically wrong and others have been proven empirically correct using the same data that own up to it, not "stand by" it?!?

Want my 2006 analysis? Read this thread where I point out contra Greenspan that due to lack of equity and falling prices the housing market is in serious trouble, using actual data instead an unnatural love for George Bush. Read Atrios or Krugman who've been explaining for years why this was going to come apart. Read Eliot Spitzer on behalf of the attorneys general of the states who tried to stop predatory subprime lending -- and were unlawfully stopped by the Bush administration, who were were propping up housing using any means possible to keep themselves in office.

You were wrong on this issue to such a grave degree that it's impossible to measure. You were wrong because you're dumb, and you were wrong because your drooling partisanship prevents you from seeing the truth about much at all.

Your "argument" upthread is nothing more than your typical knee-jerk defending conservetardism supplied by your underworked ganglia and doesn't deserve to be addressed. Post hoc propter hoc? That's seriously your argument? Well for starters, since non-profit organizations who were lending to low-income and minorities DON'T HAVE THE SAME PROBLEM WITH DEFAULTS AS THE PRIVATE BANKS clearly the problem is not CRA, it's greedy lenders and the complicit anti-regulation parties in the Republican party - you miserable racist turd.

If you're too stupid to take responsibility for your sheer idiocy to date, you're too stupid to understand any new arguments. That much is painfully clear.

And for the record, I do want to hurl invective because at this point that's all you deserve. You're partly responsible for the disaster that's being visited upon this country due to your support of criminally negligent leaders when smart people have been trying to persuade you otherwise for years. You're partly responsible for the terrible economic suffering that's beginning, and because of that you deserve nothing but shame and humiliation.

John Hansen wrote: Good job trex, don't address the argument, attack the person

How about I do both?

First of all, you're completely wrong, as usual, about your claim that Fannie, Freddie, and minority-targeted loans are responsible for the housing meltdown. (If you want to point fingers, in fact, let's start with Alan Greenspan's holding the Fed rate at historically low levels in order to create the illusion that Bush's tax cuts led to prosperity -- but I digress.)

Second of all, Hansen, you're wrong as usual and in general for repeating the bullshit you read on right-wing blogs. That you come in here on your high horse and lecture your betters on such easily -- and repeatedly -- debunked right-wing bullshit reveals that you're critically lackign in critical thinking ability, that you're terminally dishonest -- that you lie, while claimingto be a Christian! -- that the cognitive dissonace caused by the constant and conspicuous failure in the faith you place in your loathsome little right-wing belief system has permantly twisted your mind, or some toxic combination of them all.

You do not argue here in good faith, Hansen. You're consntantly proved wrong -- like now, for example -- and yet never acknowledge it. No one mistakes you for an honest commentator; just someone who spouts his erroneous right-wing articles of faith in a particularly high-handed and obnoxious manner. You have no credibility remaining, Hansen, and trex is quite right to point that out.

Jackass.

By the way, Hansen, you can take your "due to a overwhelmingly liberal press which irrespective of the true statistics seeks to downgrade the economic news" and shove it.