Inside the financial meltdown

[yrguide]

Tonight on PBS, Frontline ran a 1 hour special mapping out the financial meltdown and circumstances of the bailout.

For those of you not particularly dialed into the circumstances that caused the bailout I highly encourage you to watch it.

For those of you who are, it's still a very interesting program and you may learn quite a few things you didnt know.

There are various politicians interviewed, some democrats, some republicans, as well as other economists, financial analysts, etc.

The full program is available online here:

http://www.pbs.org/wgbh/pages/frontline/meltdown/view/

[secular]

I am sitting down to watch it now.

[LindaK]

free market -- RIP

[hort1]

I couldn't see it last night, but I hope to see it over the weekend. I hope it's still availaible, and that everyone takes the time to watch it.


Did they address this whole "Chuck Schumer and George Soros conspired to sneak attack the economy" bit?

http://www.dailykos.com/storyonly/2009/2/17/112148/557/204/698493

Hayworth got off to a good start, but he should have worked in the Acorn and poor people forcing banks to give them loans bits as well.

That would have sewed up all the threads nicely.

[dmbsituation]

free market -- RIP

It's been dead for years... maybe never really alive.

[secular]

free market -- RIP

WOW - no doubt. What an eye opener.

[jamicanprincess]

I watched this tonight. Great piece !

[daisy3600]

Yup, "risky" loans i.e. Democrats denying Fannie Mae and Freddie Mac had any problems under the 'outstanding' leadership of Raines as late as 2004-2005.
Raines said the morgages were almost riskless. All roads lead back to poor management of Freddie and Fannie because of mortgages given to people who could not make their payments and were allowed to either take seperate loans for a down payment so they could avoid private mortgage insurance or have no downpayment at all.
http://www.youtube.com/watch?v=hN31-nKndg8

[yrguide]

Yup, "risky" loans i.e. Democrats denying Fannie Mae and Freddie Mac had any problems under the 'outstanding' leadership of Raines as late as 2004-2005.
Raines said the morgages were almost riskless. All roads lead back to poor management of Freddie and Fannie because of mortgages given to people who could not make their payments and were allowed to either take seperate loans for a down payment so they could avoid private mortgage insurance or have no downpayment at all.
http://www.youtube.com/watch?v=hN31-nKndg8

You do realize that fannie and freddie are responsible for less than 20% of those risky loans, they were responsible for 16% of the sub prime loans. The remainder were underwritten by everyone else. It's a bit disingenuous to suggest that fannie and freddie were responsible for this mess when 84% of those failed loans were written by many of the banks being bailed out dont you?

http://www.mcclatchydc.com/251/story/53802.html

[daisy3600]

You're right. It wasn't just Fannie and Freddie. Don't forget the 1994 rewrite of Community Reinvestment Act of 1977 under Clinton which ‘encouraged’ banks to make loans to people with not-so-good credit. If banks didn't have so many 'sub-prime' loans they faced federal penalties. They would give loans, not because people met the down payment or credit standards, but because they fit the demographic criteria needed to receive a favorable CRA rating.
Of course, if Democrats had listened to the regulators’ warnings about Fannie and Freddie, that might have saved us billions in bail-out money.

[yrguide]

You're right. It wasn't just Fannie and Freddie. Don't forget the 1994 rewrite of Community Reinvestment Act of 1977 under Clinton which ‘encouraged’ banks to make loans to people with not-so-good credit. If banks didn't have so many 'sub-prime' loans they faced federal penalties. They would give loans, not because people met the down payment or credit standards, but because they fit the demographic criteria needed to receive a favorable CRA rating.
Of course, if Democrats had listened to the regulators’ warnings about Fannie and Freddie, that might have saved us billions in bail-out money.

You should read the article. They were private lenders that underwrote these loans that were not subject to the many government restrictions and didnt fall under CRA.

Go read the article and drop back by.

What's more, only commercial banks and thrifts must follow CRA rules. The investment banks don't, nor did the now-bankrupt non-bank lenders such as New Century Financial Corp. and Ameriquest that underwrote most of the subprime loans.

These private non-bank lenders enjoyed a regulatory gap, allowing them to be regulated by 50 different state banking supervisors instead of the federal government. And mortgage brokers, who also weren't subject to federal regulation or the CRA, originated most of the subprime loans.

[KISSaholic4life]

You're right. It wasn't just Fannie and Freddie. Don't forget the 1994 rewrite of Community Reinvestment Act of 1977 under Clinton which ‘encouraged’ banks to make loans to people with not-so-good credit. If banks didn't have so many 'sub-prime' loans they faced federal penalties. They would give loans, not because people met the down payment or credit standards, but because they fit the demographic criteria needed to receive a favorable CRA rating.
Of course, if Democrats had listened to the regulators’ warnings about Fannie and Freddie, that might have saved us billions in bail-out money.

And don't forget the 8 years that Bush did NOTHING to stop the meltdown.

[daisy3600]

If Bush had said one word about bad loans to 'poor communities' he would have been called a racist till the cows came home. That's all we would have heard. How Bush wanted poor people to be forced to live on the streets and Bush is racist and Bush doesn't want minorities to be home owners, blah, blah, blah.
Of course he didn't do anything to stop these poor practices. The democrats wanted them. They turned a blind eye to the problem. Let them correct their own mistakes. If a Republican even looks cross-eyed at a program that has anything to do with minorities (good program or bad program) the cry of racist is made from the every mountain, valley, hill and house.

[KISSaholic4life]

If Bush had said one word about bad loans to 'poor communities' he would have been called a racist till the cows came home.


BS!


That's all we would have heard. How Bush wanted poor people to be forced to live on the streets and Bush is racist and Bush doesn't want minorities to be home owners, blah, blah, blah.

BS!



Of course he didn't do anything to stop these poor practices. The democrats wanted them. They turned a blind eye to the problem. Let them correct their own mistakes. If a Republican even looks cross-eyed at a program that has anything to do with minorities (good program or bad program) the cry of racist is made from the every mountain, valley, hill and house.

Bush had 8 years to change the laws to prevent a meltdown - he didn't do a damn thing.

[LastLaugh]

If Bush had said one word about bad loans to 'poor communities' he would have been called a racist till the cows came home. That's all we would have heard. How Bush wanted poor people to be forced to live on the streets and Bush is racist and Bush doesn't want minorities to be home owners, blah, blah, blah.
Of course he didn't do anything to stop these poor practices. The democrats wanted them. They turned a blind eye to the problem. Let them correct their own mistakes. If a Republican even looks cross-eyed at a program that has anything to do with minorities (good program or bad program) the cry of racist is made from the every mountain, valley, hill and house.
If your viewpoint is correct then that makes Bush a coward.

[NetworkSweeper]

If Bush had said one word about bad loans to 'poor communities' he would have been called a racist till the cows came home. That's all we would have heard. How Bush wanted poor people to be forced to live on the streets and Bush is racist and Bush doesn't want minorities to be home owners, blah, blah, blah.
Of course he didn't do anything to stop these poor practices. The democrats wanted them. They turned a blind eye to the problem. Let them correct their own mistakes. If a Republican even looks cross-eyed at a program that has anything to do with minorities (good program or bad program) the cry of racist is made from the every mountain, valley, hill and house.

Your right there.

Without blaming anyone, we should regulate back to home buyers having good credit (700+) a steady job and 20 percent down. Home ownership should be earned for those that are ready for the responsibility.

[daisy3600]

If your viewpoint is correct then that makes Bush a coward.

So Bush is a coward because he let the Democrats have their way? Bush is the coward, not Waters or Frank?

[yrguide]

Your right there.

Without blaming anyone, we should regulate back to home buyers having good credit (700+) a steady job and 20 percent down. Home ownership should be earned for those that are ready for the responsibility.

Well, speak to the private lending institutions who saw writing loans as an additional way to make proceeds by selling mortgage backed securities rather than putting homeowners through a full analysis.

Fannie and Freddie werent writing no doc loans. They werent because they were regulated and held to higher standards. The private sector did not have the same restrictions in place and wrote 84% of the sub prime loans.

[LastLaugh]

So Bush is a coward because he let the Democrats have their way? Bush is the coward, not Waters or Frank?
Waters and Frank had their own agendas, how would pushing that agenda make them cowardly? There is a difference between being stupid and venal and being a coward.

[daisy3600]

Waters and Frank had their own agendas, how would pushing that agenda make them cowardly? There is a difference between being stupid and venal and being a coward.


Amen to that. The problem is the stupid and venal politicians are still in office and affecting policy.

[LindaK]

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