Housing emerges as economic bright spot after years in the dark | Page 2 | TigerDroppings.com

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EthanL
LSU Fan
Auburn,AL
Member since Oct 2011
3306 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

I just bought a house. 3.25% fixed. No balloon, no nothing.


I know of two people at work that just did this.

I need to refinance by i am too damn lazy.

Shite






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Mike da Tigah
St. Denham Rougeville
Member since Feb 2005
41277 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

How can you say people are responsible when it was the banks who were approving them. The banks were taking the risks (and generally reaping the rewards) - so they take the responsibility.


I will never forget a good friend of mine encouraging me at a party we were at to look into these ARM loans, and how "Man Mike, you can get in that big house down the street with no problem at all." I thought then as I do now, if it sounds too good to be true, it is, and it turns out that I was right again. I listened to my better judgement rather than my desire to upgrade and I'm much better off than those who went swimming.

This does get back to the individual, and Barney as well as the banks are responsible as well. We all knew better than this, but we did it anyway. Why? Because we wanted to, and here we are.








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BugAC
LSU Fan
Baton Rouge
Member since Oct 2007
18852 posts

re: Housing emerges as economic bright spot after years in the dark


Barney Frank

quote:

Congressman Frank replied in 2003 that critics "exaggerate a threat of safety" and "conjure up the possibility of serious financial losses to the Treasury, which I do not see." Far from being reluctant to promote risky practices, Barney Frank said, "I want to roll the dice a little bit more in this situation."


quote:

In 2004 he said: "I believe that we, as the Federal Government, have probably done too little rather than too much to push them to meet the goals of affordable housing." He went further: "I would like to get Fannie and Freddie more deeply into helping low-income housing."


quote:

Fast forward now to 2008, after the risky mortgages had led to huge numbers of defaults, dragging down Fannie Mae, Freddie Mac and the financial markets in general — and with them the whole economy. Barney Frank was all over the media, pointing the finger of blame at everybody else. When financial analyst Maria Bartiromo asked Congressman Frank who was responsible for the financial crisis, he said, "right-wing Republicans." It so happens that conservatives were the loudest critics who had warned for years against the policies that Barney Frank pushed, but why let facts get in the way? Ms. Bartiromo did not just accept whatever Barney Frank said. She said: "With all due respect, congressman, I saw videotapes of you saying in the past: 'Oh, let's open up the lending. The housing market is fine.'" His reply? "No, you didn't see any such tapes."


LINK

quote:

REP. BARNEY FRANK, D-MASS.: I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They're not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward. They're in a housing market. I do think their prospects going forward are very solid. And in fact, we're going to do some things that are going to improve them.


LINK






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BigBoyTiger
LSU Fan
Chicago
Member since Aug 2005
8751 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

Did government force financial institutions to repackage risky loans as AAA?


Aren't they suppose to monitor these things, a-hole? And secondly, no one forced investors to buy these securities. Maybe they should do some due diligence. But you Liberals don't think people are smart enough to think for themselves.

By the way, I work in banking. We were heavily regulated before this shite went down and continue to be more regulated.

What other good news is there? The consensus that the economy is going to grow another 2% this year? Or that absent pumping trillions of ficticious money into the system we would be totally screwed? That we continue to grow the government dole? That we have $16 trillion in debt that continues to grow with no sign of repayment? That Social Security and Medicare are about to go bust in 20 years?

Tell me what the good news is, a-hole. I'll hang up and listen.

Such a hack.







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a want
LSU Fan
North America
Member since Oct 2010
9984 posts

re: Housing emerges as economic bright spot after years in the dark


Did Barney Frank force financial institution to ignore data showing that up to 60% of those mortgages could be fraudulent and repackage them risky loans as AAA?

Who accepted the risk? Who profited from this (up until around 2007)? Why are they responsible when they are making money, but it's somebody else's fault when their risk turn out bad? THE BANKS APPROVED LOANS THEY KNEW WERE FRAUDULENT. PERIOD. Congress had nothing to do with that.






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a want
LSU Fan
North America
Member since Oct 2010
9984 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

Lsut81




A new low. C'mon, man.






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BugAC
LSU Fan
Baton Rouge
Member since Oct 2007
18852 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

How can you say people are responsible when it was the banks who were approving them. The banks were taking the risks (and generally reaping the rewards) - so they take the responsibility.


Ever heard of the Community Reinvestment Act?

LINK

quote:

United States federal law designed to encourage commercial banks and savings associations to help meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods.[1][2][3] Congress passed the Act in 1977 to reduce discriminatory credit practices against low-income neighborhoods, a practice known as redlining.[4][5]



quote:

"But they were the ones who pushed Fannie and Freddie to make a bunch of loans that were imprudent, if you will. They were the ones that pushed the banks to loan to everybody. And now we want to go vilify the banks because it's one target, it's easy to blame them and congress certainly isn't going to blame themselves. At the same time, Congress is trying to pressure banks to loosen their lending standards to make more loans. This is exactly the same speech they criticized them for."


LINK






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Taxing Authority
LSU Fan
Houston
Member since Feb 2010
22966 posts
 Online 

re: Housing emerges as economic bright spot after years in the dark


quote:

Did government force financial institutions to repackage risky loans as AAA? ... How can you say people are responsible when it was the banks who were approving them.
They certainly incentivised it. The government threatened lenders to write more loans to marginally approveable borrowers. Do you think the banks that reluctantly underwrote those loans wanted to hold the paper, when they could dump it? You'd want to get rid of it too.






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lsuroadie
LSU Fan
South LA
Member since Oct 2007
5658 posts
 Online 

re: Housing emerges as economic bright spot after years in the dark


quote:

THE BANKS APPROVED LOANS THEY KNEW WERE FRAUDULENT. PERIOD



your fail is so monumental and i want to jump in badly but everyone else is doing a good job of checking you so I'll bug out.







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BigBoyTiger
LSU Fan
Chicago
Member since Aug 2005
8751 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

Who accepted the risk? The fricking investors did. Maybe they should do some due diligence before purchasing.

Who profited from this (up until around 2007)? The government (FHA), the Banks, investors, people owning homes. Everybody was in on it.

Why are they responsible when they are making money, but it's somebody else's fault when their risk turn out bad? Everybody was responsible. I actually blame the people who don't know basic finance and purchase homes they KNOWINGLY CAN'T AFFORD. You are just like half of this country that votes blue. It's always someone else's fault. You all fail to look in the mirror.

THE BANKS APPROVED LOANS THEY KNEW WERE FRAUDULENT. PERIOD. Congress had nothing to do with that. .... Oh frick you, Congress knew what was going on. You don't think they knew what was going on at Freddie and Fannie? Congress and the Federal Government is one of the parties responsible for the shite that happened.








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a want
LSU Fan
North America
Member since Oct 2010
9984 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

They certainly incentivised it. The government threatened lenders to write more loans to marginally approveable borrowers. Do you think the banks that reluctantly underwrote those loans wanted to hold the paper, when they could dump it? You'd want to get rid of it too.


But the government NEVER incisiveness approving fraudulent loans. The government never forced "self reporting" as opposed to legitimate credit checks at banks.






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Lsut81
USA Fan
Member since Jun 2005
64974 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

A new low. C'mon, man.



Trust me, I can go much lower.... I have 0 respect for the politicians in Washington.



And ftr, I love the gays... Some of my best friends are gay and they would think that previous comment was funny






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BugAC
LSU Fan
Baton Rouge
Member since Oct 2007
18852 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

a want


LINK

quote:

Fannie Mae and Freddie Mac were two government-sponsored enterrises (GSEs) that created, and remain highly involved in, the secondary market for mortgage-backed securities. Before the subprime mortgage crisis, they owned or guaranteed $1.4 trillion, or 40%, of all U.S. mortgages.


quote:

They only held $168 billion in subprime mortgages -- but it was enough to capsize the two. Find out how the two GSEs supported the secondary market, which helped American families realize the dream of homeownership, and how that turned into the nightmare of the subprime mortgage crisis.


quote:

The first warning that there was a problem with subprime mortgages came in August 2007. That's when Fannie Mae announced it would skip a benchmark debt offering for the first time since May 2006. This meant that even the highly-rated mortgage-backed securities offered by the government-sponsored entities were being rejected by the secondary market. At that time it was thought that Fannie had enough cash to enable it to wait until the market improved. However, by November 2007. Fannie declared a $1.4 billion quarterly loss and announced it would seek $500 million in new funds. Freddie then disclosed a $2 billion loss, sending its stock price down 23%.


quote:

On March 23, 2008, Federal regulators agreed to let Fannie Mae and Freddie Mac take on another $200 billion in subprime mortgage debt. This was despite the fact that the the two GSEs were already up to their armpits in alligators trying to raise enough cash to keep themselves solvent. It also points out how everyone at the time thought the subprime crisis was restricted to real estate, and it would correct itself soon. Perhaps they didn't realize how derivatives had exported the subprime mortgage defaults throughout the entire financial world. As it turned out, this was another $200 billion the government had to bail out later that year.


And here you go a want, here are your banks.

quote:

The Federal Housing Finance Board agreed to let the regional Federal Home Loan Banks take an extra $100 billion in mortgage-backed securities for the next two years. These loans were also guaranteed by Fannie and Freddie. In just a week, the two GSEs had $300 billion in bad loans added to their already-shaky balance sheet.


quote:

March 25, 2008 - The Federal Housing Finance Board agreed to let the regional Federal Home Loan Banks take an extra $100 billion in mortgage-backed securities for the next two years. These loans were also guaranteed by Fannie and Freddie. In just a week, the two GSEs had $300 billion in bad loans added to their already-shaky balance sheet. This was also after the Federal Reserve agreed to take on $200 billion in bad loans from dealers (actually, hedge funds and investment banks) in exchange for Treasury notes. Last, but certainly not least, the Fed had already pumped $200 billion into banks through its Term Auction Facility. In other words, the Federal government had guaranteed $730 billion in subprime mortgages, and the bank bailouts were just getting started.


quote:

On July 22, 2008, U.S. Treasury Secretary Henry Paulson asked Congress to approve a bill allowing the Treasury Department to guarantee as much as $25 billion in subprime mortgages held by Fannie and Freddie. The two GSEs held or guaranteed more than $5 trillion, or half, of the nation's mortgages. However, the $25 billion guarantee was more to reassure investors -- and it didn't work for long.Wall Street investors continued to pummel the GSEs stock prices, to the point that they couldn't raise the cash needed to pay off the loan guarantees they held. Wall Street was savvy enough to realize that a $25 billion infusion by the Federal government wasn't going to be enough. Stockholders wanted out -- before Fannie and Freddie were nationalized and their investments equaled zero.


I don't see how, you can sit there and say government was not the problem. They are Public Enemy #1 in the mortgage crisis. The banks and the idiot lendees are ancillary contributions to the problem.



This post was edited on 1/29 at 9:09 am


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buddhavista
Member since Jul 2012
3543 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

1) Government forcing banks to give out risky loans to unqualified applicants. Frank/Dodd


most of the toxic loans from 2005-08 were originated by organizations not covered by gov't regulation. So the gov't didn't force them to do shite.

Now the gov't did enable them by buying up all sorts of garbage, but even FNE/FRE wouldn't touch the crazy toxic stuff. Those were sold to private investors.






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BigBoyTiger
LSU Fan
Chicago
Member since Aug 2005
8751 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

But the government NEVER incisiveness approving fraudulent loans.


Riiiiggghhhtttt.. Politicians used Freddie and Fannie to push "affordable" loans to those not making much money.

They were all in on it, you fricking dolt.






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BigBoyTiger
LSU Fan
Chicago
Member since Aug 2005
8751 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

Now the gov't did enable them by buying up all sorts of garbage, but even FNE/FRE wouldn't touch the crazy toxic stuff.


Flat out incorrect. You couldn't be more incorrect.

Freddie and Fannie were mandated to take more risk around 2005. They did this by purchasing a bunch of crazy, poorly structured, poorly underwritten mortgages.






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a want
LSU Fan
North America
Member since Oct 2010
9984 posts

re: Housing emerges as economic bright spot after years in the dark


BugAC. I know what you saying. I'm familiar with the Community reinvestment act and some of the problems it caused. But the problems coming from it pale in comparison to the problems caused by the number of risky loans that were approved by banks. The problems pale in comparison the number of financial institutions that repackaged these loans as AAA when they KNEW they were garbage b/c their own internal reviews told the so.

It's long, but if you get an opportunity, watch this:

LINK







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WildTchoupitoulas
112 posts
Member since Jan 2010
15845 posts
 Online 

re: Housing emerges as economic bright spot after years in the dark


quote:

These are the reasons we are in this mess

You obviously haven't bought a house in the last 15 years.






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SoulGlo
LSU Fan
Shinin' Through
Member since Dec 2011
3609 posts
 Online 

re: Housing emerges as economic bright spot after years in the dark


quote:

More good news



It would be good news if it wasn't a continuation of government handouts that led to the mess the first time.






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buddhavista
Member since Jul 2012
3543 posts

re: Housing emerges as economic bright spot after years in the dark


quote:

Freddie and Fannie were mandated to take more risk around 2005. They did this by purchasing a bunch of crazy, poorly structured, poorly underwritten mortgages.

I am not defending FNM/FRE, they are horrible. But they laid off the worst stuff, b.c it didn't mean their funding guidelines. And if they did accept the loans, the low doc requirements by originators would be a no go with FNM/FRE, as they required proof of income.

in 2006, 84% of all sub prime loans were originated by private lending institutions.
LINK

They were not governed by the same rules as banks per CRA. And in 2006, FNM / FRE only held 24% of the sub prime loans







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