GOP claim : Dems 'forced' banks to give risky customers mortgages and credit cards. Anyone have proof of this?

Did government also force banks to not keep sufficient reserves to cover the risk? If not, then what is the excuse for failing to keep suffiecient reserves? Were these folks to dumb to understand that riskier loans call for greater, not lesser, reserves? Or too dumb to know that the loans were risky? Either way, what the heck are such dummies doing running big banks?





Sorry, but even it is somehow the fault of Democrats that risky loans were made, failure to keep adequate cash reserves to cover such risk is due all the de-regulation that the GOP was so proud of. You know, government getting out of the way so that banks can make money so that all boats will rise with the rising tide of prosperity.GOP claim : Dems 'forced' banks to give risky customers mortgages and credit cards. Anyone have proof of this?
Yes. There are many statutes which are tedious to understand, name and explain, but the point is that we federally backed subprime loans to the tune of several hundred billion dollars. Honestly, if you dont know this, then use your friend google. There were innumerable programs that gave risky mortgages federal backing, and there still are.GOP claim : Dems 'forced' banks to give risky customers mortgages and credit cards. Anyone have proof of this?
No.





The bulk of risky loans weren't covered by the CRA. I could add that Bush signed an order making down payments on homes for the poor as part of his ';Ownership Society'; initiative if we wanted to pick on such things, but that wasn't the problem either.





Even the bad risky loans were only a tiny bit of the problem





The bigger problem is the folks commoditizing those loans were borrowing up to 70-to-1 (1.4% down, so borrowing up to 98.6%) to purchase those loans, so that magnified the problem by a large multiple (average about 28 times what home owners borrowed).





Perspective is healthy.





Ask yourself this. Is there a CRA for commercial real estate?


Were there subprime loans for commercial real estate?





Then why are banks, mortgage companies and investment banks (now mostly bank holding companies) taking trillion dollar hits on commercial real estate? Could it be they were over leveraged?
The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA ';protest'; is issued by a ';community group.'; This can cost banks great sums of money, and the ';community groups'; understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities
No, this is just one of our GOP false talking points for our GOP base. The vast majority of toxic loans were NOT under the CRA- Community Reinvestment Act. More than 80% of all toxic loans were made by PRIVATE financial institutions not covered by the CRA. Most of the toxic loans did NOT go to the poor, but went to finance fairly well to do peoples automobiles and McMansions.





Our GOP spins this talking point the way we do to rile up the blatant racism and socioeconomic bigotry within our base. We lie to them and get them whipped up into a liar's rage.
They are generally referring to the Community Reinvestment Act I believe as well as discrimination laws and groups which bring lawsuits when not enough people of color receive loans (despite people of color being statistically more likely to be economically disadvantaged). Basically a group of laws with the intention of bringing equality and home ownership to minorities but after execution caused a lot of risky loans.
I HAVE PROOF THAT IT IS ABSOLUTELY FALSE





(I don't see ANY mention oF Democrats when Bush took the credit for this plan)





AND---This plan was AFTER McCain supposedly WARNED CONGRESS that Fannie Mae and freddie Mac were not solvent





so what did Bush do to these unsolvent enities





SADDLED THEM WITH MORE DEBT

















The following is President George W Bush





More Americans than ever own their own homes, but we must continue to work hard so that every family has an opportunity to realize the American Dream. In 2002, I announced a goal to add 5.5 million new minority homeowners by the end of the decade. Since then, we have added 2.3 million new minority households. My Administration has also set a goal of adding 7 million new affordable homes to the market within the next 10 years. In my FY 2006 budget, I proposed a single family housing tax credit and two mortgage programs -- the Zero Downpayment mortgage and the Payment Incentives program -- to help more families achieve homeownership. In 2003, I signed the American Dream Downpayment Act, and I have proposed more than $200 million to continue the American Dream Downpayment Initiative to provide downpayment assistance to thousands of American families. By promoting initiatives such as financial literacy, tax incentives for building affordable homes, voucher programs, and Individual Development Accounts, we are strengthening our communities and improving citizens' lives.





NOW, THEREFORE, I, GEORGE W. BUSH, President of the United States of America, by virtue of the authority vested in me by the Constitution and laws of the United States, do hereby proclaim June 2005 as National Homeownership Month. I call upon the people of the United States to observe this month with appropriate ceremonies and activities recognizing the importance of homeownership.





http://www.whitehouse.gov/news/releases/鈥?/a>
I don't know about that. But I DO know that what really busted the system was NINA loans. No Income No Asset loans. Nothing.. you could get a house with no money down and no job. This happened in 2003 when the conservatives were supposed to be watching the store.





Read this and weep for all Americans (except mortgage brokers and bankers who sold the mortgage backed securities)





http://uspolitics.about.com/b/2008/09/21/208640.htm
Actually Wall Street begged congress to do it. After Wall Street was deregulated, they figured out how to make sub prime mortgages look like AAA loans by using derivatives. They could then sell these loans at top dollar. It was genius. Face it all of congress is in Wall Streets pocket.
Everyone in congress allowed the banks to give out these predictor loans they all though it was a good idea at the time because it made a lot of their special interest friends rich . But they didn't factor in the bubble that would follow if a recession hit this country as it did.
What party did the president who signed the Community Reinvestment Act march with? DEMOCRAT!





What party did Barney Franks march with when he said Fannie Mae and Freddie Mac were solvent? DEMOCRAT!





What party was in the majority in Congress during the last two years of the Bush administration and since? DEMOCRAT!





Next inane question?
Barney Frank (one of the highest liberal voting records) was the head of the House Finance Committee and forced banks to give out loans and credit cards to disadvantaged people AKA people who couldn't afford any of it.
Look into past actions by ACORN lawyers. Obama was even an ACORN lawyer. If risky borrowers were denied a loan, they could go to ACORN, who would return to the bank with lawyers and threaten a lawsuit if they denied the application.
banks were harangued if they didn't reach a certain quota of home loans in poor areas ie saying the banks were redlining against minorities.





I dont know if fines are levied or not, but I know redlining is considered a federal offense within


banking regulations.
Yes, just do a little research on the legislation proposed and passed on this subject. Public records are available...you can see just who and what led us to the banking fiasco...Chriss Dodd and Barney Frank led by B. Clinton.
I'll just point up at the answers above, and dare you to accept the facts. Hard for a lib to do, but you have access to this information for yourself.


Nice try though.
The Commuity Reinvestment Act which has been revamped a few times. It started during the Carter Administration.
No, they don't. None of the answers claiming this provide any proof, they just restate the claim.
It was legislated. Why do you think ACORN exists? Research the Community Reinvestment Act.
The question should be ';Anyone have proof of this being false';.
yes, it was done through Community Reinvestment Act, Fannie Mae and ACORN.
All time foreclose rates for one.Ask bend over Frank an Criss Dodd.