Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
False. They, too, had to buy loans, or loan-based investment products, from loan originators that had to meet HUD quotas or face federal lawsuits or other regulator restrictions. That's why Barney Frank made this startling admission:
From the same C-Span broadcast I already posted...
Frank blurted out: "No more goals, no more telling the private sector" how to invest in the housing market."
"...telling the private sector..."
Telling the private sector how to invest in the housing market. Let that sink in...
Investment Banks like Merrill Lynch who were not under any government ordered housing mandate were entering and engaging in subprime lending because they thought it would make them lots of profit.
Barny Franks comment would not apply to the Investment Banks, because the Investment Banks were never told to do it.
Merrill Lynch & Co. said Tuesday that it agreed to buy National City Corp.'s First Franklin Financial Corp. unit for $1.3 billion to expand in sub-prime mortgage lending.
The purchase is thelatest of several mergers involving sub-prime lenders, which offer loans to less creditworthy borrowers, as volumes fall and margins are squeezed.
Merrill also wants to add profit from securitizations, the packaging of mortgages into bonds that are sold to investors, and better compete with Wall Street rivals such as Bear Stearns Cos. and Lehman Bros. Holdings Inc. "They're thinking strategically in buying a business when it's out of season," said Bill Fries, a portfolio manager at Thornburg Investment Management Co.
...
Dow Kim, Merrill's president of global markets and investment banking, said the transaction adds scale and creates "meaningful synergies" in securitization and trading.
The purchase is the latest of a mortgage company by a major investment bank.
Last month, Morgan Stanley agreed to pay $706 million for residential lender Saxon Capital Inc. Barclays and Deutsche Bank both announced mortgage servicing acquisitions this year.
"Strategically, this isn't a surprise becauseMerrill wanted to add an asset generator," said Jeff Harte, an analyst at Sandler O'Neill & Partners. "The price is a challenge to get my arms around. Exactly what earnings stream they bought is difficult to determine."
Merrill Lynch and the other Investment Banks were not forced into the subprime business by the Federal Government. They thought it would be profitable. They also didn't care about the GSE underwriting standards.
That's not the free market, that's crony capitalism. We don't lower standards nothing else happens
We don't lower standards, none of this happens. Treat the cause not the symptom.
The mortgage industry, left to their own standards, made a ton of money using conservative lending standards, and never failed as a whole. But you know better, right? pfffttt
LMAO I know what the cause is, you're reacting to symptoms. Keep chasing rainbows.
LMAO! You actually think the private sector has not been in bed with the government! That's adorable you actually believe in the "free market". Sometimes you just have to grow up and learn history. Crony capitalism or whatever you want to call in each human era has always been around in some form.
the last bubble had burst in 89/90...at least here in NY
housing started rising again (new bubble) in 94/95 once rules were relaxed
I saw it happen in real life...in 1992 my parents were thinking of selling their house...realtor told them they would be LUCKY to get 125k..they looked again in 1996 and it had already increased to 190k....they sold in late 04...for 460k(as is)....the same small house with a 30 year old furnace and old style leaky doublehung windows..... over triple in a matter of 13 years
You're talking about local conditions, I'm talking nationally.
Hahaha whoops. That wasn't enough alone to cause it. When you figure out why the most toxic loans originated under bush jr then you will understand.
Indeed.
Quote:
“We can put light where there’s darkness, and hope where there’s despondency in this country.
And part of it is working together as a nation to encourage folks to own their own home.”
(President Bush, Oct. 15, 2002)
Quote:
“The Bush administration took a lot of pride that homeownership had reached historic highs,” Mr. Snow said in an interview.
“But what we forgot in the process was that it has to be done in the context of people being able to afford their house. We now realize there was a high cost.”
For much of the Bush presidency, the White House was preoccupied by terrorism and war; on the economic front, its pressing concerns were cutting taxes and privatizing Social Security.
The housing market was a bright spot: ever-rising home values kept the economy humming, as owners drew down on their equity to buy consumer goods and pack their children off to college.
Investment Banks like Merrill Lynch who were not under any government ordered housing mandate were entering and engaging in subprime lending because they thought it would make them lots of profit.
Which lending standards were they going by? Oh, yeah, the GSEs we'll loan to anyone with 3%-down and tarnished credit standards via Clinton's Admin.
In our example, we have 13,000 people entering the labor force every year due to turning 18, 8,000 people leaving the labor force every year due to retirement, and 4,000 retired people passing away.
In Year 0, there are 493,500 people in the labor force and 120,000 not in the labor force. In our example, that would mean that 120000/613500, or 19.6% of the population, is not in the labor force.
In Year 10, given the criteria I laid out, there would be 493,500 + 13,000*10 - 8,000*10 = 543,500 people in the labor force, and 120,000 + 8,000*10 - 4,000*10 = 160,000 people not in the labor force. Now, 160,000/703,500, or 22.7% of the population, is not in the labor force.
Note that both the labor force and the not in the labor force grew due to natural means. The latter, however, grew faster, thus increasing its percentage.
Source: U.S. Census Bureau, Saperston Companies, Bankrate
Research Date: 1.1.2014
Total Number of Americans who turn 65 per day............6,000
Retirement Statistics | Statistic Brain • Retirement Statistics | Statistic Brain
FACT: number of americans turning 65 daily.....6,000-8,000
number of americans turning 18 daily...... 13,000
with only 6k-8k of people being ELIGIBLE to retire, yet 13k are ELIGIBLE to COME IN TO the work force...the work force SHOULD be increasing...yet the politicians play with numbers....
and the "'millennials " are a BIGGER generation than the boomers
People retire at all ages, 45, 50, 55, 60, not just 65. Many have retired twice by the time they reach 65.
LMAO! You actually think the private sector has not been in bed with the government!
No that's your misguided perception because you cannot discuss the truth. So you make things up.
Quote:
Originally Posted by dv1033
That's adorable you actually believe in the "free market".
Of course I do. The mortgage industry, held to their own standards never failed as a whole.
Quote:
Originally Posted by dv1033
Sometimes you just have to grow up and learn history.
Except you don't learn from history. That's been proven by your childish, disconnected posts.
Quote:
Originally Posted by dv1033
Crony capitalism or whatever you want to call in each human era has always been around in some form.
Who says it wasn't?
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
