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The leading private securitizers were Investment Banks that had always been Investment Banks; they hadn't combined with commercial banks. The leading Investment Banks weren't operating as commercial banks.
Quite true. The private label securitizers that processed so much of the mortgage product that ultimately failed had been built out by the Wall Street "Big Five" for the express purpose of providing a standards-free bypass around the limits and minimums that characterized the GSE's, creating thereby a way for pretty much anything at all to get into the secondary markets. Some legit commercial banks did commission sketchy brokers who then palmed off piles of non-conforming paper through Wall Street, but that's about the extent of that.
Last edited by Reynard32; 09-26-2015 at 01:00 PM..
It was Fannie and Freddie, initiators of the high LTV mortgages and severely reduced lending standards to meet ridiculously ill-advised HUD "affordable lending" mandates, that needed a multi-hundred billion dollar bailout.
Those would be "targets", not "mandates," and from the days of Bush-41 through 2000, those goals were set in line with what the GSEs had already been accomplishing. You are simply awash in a sea of hard-right corporatist propaganda.
The GSEs specifically sought to buy loans made to those who had no credit history whatsoever from Countrywide and their other best lenders." I already posted the Fannie Mae document.
No, the non-conforming garbage that Countrywide et al. could not get through Desktop Underwriter and under consideration by Fannie Mae, all went off to the private label shops on Wall Street where seldom was heard a discouraging word, and even the worst sort of slop went straight into securirtization.
FCIC members were never given copies of this and his other research to consider as causes for the mortgage meltdown and subsequent financial crisis. In other words, the FCIC was manipulated into issuing an erroneous predetermined outcome.
And as we all know former Dem Congressman Barney Frank already admitted the truth communicated in the paper linked above, on C-Span. Of course, that was after Frank had already resigned.
Those would be "targets", not "mandates," and from the days of Bush-41 through 2000, those goals were set in line with what the GSEs had already been accomplishing. You are simply awash in a sea of hard-right corporatist propaganda.
So why did the GSEs need a multi-hundred billion dollar bailout if there was nothing wrong with the loans they bought?
LOL! Edward Pinto is an umitigated right-wing hack. He was a young functionary at Fannie Mae in the 1980's. When Republicans dragged him before Congress 20 years later to testify in regard to his Great Recession magnum opus, he could not produce any of his alleged data (claiming it had been taken down from the internet, but really was out there at one time even though no one else apparently saw it), and had to admit that he wrote his paper during slow periods at his real job as an estate planner.
These are the sorts of carnival dolls that the right-wing is so regularly forced to turn to. As if people might one day run out of softballs to knock them over with...
Hi! My name is Edward
Last edited by Reynard32; 09-26-2015 at 02:29 PM..
So why did the GSEs need a multi-hundred billion dollar bailout if there was nothing wrong with the loans they bought?
I'm not surprised you would need to ask. The GSE's were put into conservatorship as a means of protecting them from further damage in the private sector. Remember that the people you admire so much had at the time expertly plunged the world into the worst economic collapse since the Great Depression. Private brokers had abused credit markets to unheard of degrees, producing massive volumes of mortgage-related paper that they knew full well when they wrote it would ultimately fail, then passing that slop off into secondary markets via Wall Street's no-standards private-label securitizers. Just a game of strip off the profit, then sell off the risk. Eventually these folks poisoned enough of the well that trust evaporated and the opaque tendrils of systemic risk brought the financial system to a near standstill. Great work by you guys.
LOL! Edward Pinto is an umitigated right-wing hack.
His credentials at Fannie Mae are:
1985-1987: Fannie Mae's Senior Vice President for Marketing and Product Management, with responsibility for single- and multi-family lending and affordable housing
1987-1989 Fannie Mae's Executive Vice President and Chief Credit Officer
He researched and published his findings from the perspective of someone who knows how the GSEs operate from the inside
Furthermore, Fannie Mae reports (on page 2) that 77 percent of its book of single-family mortgage guarantees has been acquired since the start of 2009. What happened to all the loans they guaranteed before that?
In 2007: $2.9 trillion
In 2013: about the same, $2.9 trillion - 77% of which was acquired since 2009.
So what happened to the $2.23 trillion in mortgages that Fannie Mae suddenly didn't guarantee in 2008, just one year later?
Coincidentally, the Federal Reserve has about that much in agency MBS and debt on its books, bought with taxpayer money (Treasury-issued debt to the public) since 2009.
Last edited by InformedConsent; 09-26-2015 at 02:51 PM..
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