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Politics Central An archive of discussions of a political nature that took place here.

 
 
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  #1  
Old 17 Feb 09, 04:23
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Video Not Allowed To Be Shown In America

This video shows that George Bush tried to warn Congress in 2002 that this economic crisis was coming, if something was not done. But congress refused to listen, along with Barney Frank. This video says it all.

Also that the liberal AMERICAN media did not want this video on You Tube, so they had Time Warner threaten a law suit (proprietary rights) if it was not taken off. This link is of the same video but is routed through Canada . Everyone in America needs to see this!



I apologize if this is old news for anyone, I hadn't seen it.
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  #2  
Old 17 Feb 09, 04:51
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Agreed. The Bush administration did try to put through legislation through in regards to F and F after the Clinton administrations liberal obsession with getting lower paid and ethnic minorities home loans. I believe and her name escapes me he had some San Francisco lobbyist on the case who said the Banks lending criteria was institutionally racist.
However and Mr Greenspan's got a cheek in this video because his and the Feds meddling in the interest rate and money supply created this enormous credit bubble which fuelled that housing boom that F and F then financed, a credit bubble that then went way beyond the housing market.
  #3  
Old 17 Feb 09, 09:37
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Banks traditionally did NOT lend to people that the bank did not believe would repay the loan according to the contract. (Even with that caveat, banks expected a 1-3% loss rate, which is/was "priced" into everyone elses' loans.) (See, you CAN'T escape paying for no-loads, one way or the other.)

If, as the Lobbiest mentioned above stated, that was institutionally racist, it was only in the mind of the lobbiest. What COULD be stated is that banks are reluctant to lend to those whose application, credit history and work history indicate that they are poor credit risks. If, at any given branch, the majority of applications that are rejected, under the criteria for "sound lending", happen to be those of black people, in the minds of the "PPSG" (Poor People Support Groupies) it is RACIST. No other explaination is acceptable.

Since the entire world is against "racism", this suddenly turns from being merely a sound business decision (landing standards) into a social "problem". Therefore...... we (Congress) will legislate and support every effort to insure that "racism" is removed from lending criteria. (i.e. you banks WILL lend to the "poor".)

Hence we get "credit scores" as the only criteria for lending. Employers are most reluctant to verify information requests on employees (it violates their privacy). Garden industries purporting to "help" you improve your "credit scores" emerge. (If you want to point some fingers at "preditors", start there, IMHO.) Couple that with Congressional pressure to make the loan to the poor......

Well, I'll let you connect the dots.

How do I know these things? I was a lending officer at the beginning of this mess. I had been tasked to do a study on our "branches" to determine, 1) How our branch by branch deposits matched up with competitors' deposits in various neighborhoods, and 2) quantify our loan portfolio to each "nieghborhood". All this to insure that we were adhering to the spirit of the Community Reinvestment Act.

After the study was taken to the "decision makers", policy was "remade" to insure that loans were "forced" into those "neighborhoods" that were "lacking" in loan levels. (Which, incidently, just happened to be the poorest neighborhoods. DUH!)

You can see where that would lead. (Well, at least a good "tea leaf reader" could.)

For me, it became a matter of honor. Persons who are in a position of fudiciary responsibility are honor bound to treat other people's money (i.e. investors' and depositors') as if it was their own. I could not, under that criteria, make loans to the people I was being forced to do so. That, amongst other reasons, is why I left the banking industry.

Apparently there were other "lending officers" who were willing to prostitute themselves otherwise...... a LOT of them.

If the banks had just protested, rallied around a mutual point of fiducial responsibility, done anything to turn this "tide"...... but no, protesting on the grounds of fudiciary responsibility to Congress is rather like trying to give a lecture on the "value of human of life" to a serial killer.

We have just reaped what we have sown. ....and I accuse Congress of doing the sowing.

GG
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Last edited by Grognard Gunny; 17 Feb 09 at 12:04..
  #4  
Old 17 Feb 09, 09:51
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Quote:
Originally Posted by Grognard Gunny View Post
If, as the Lobbiest mentioned above stated, that was institutionally racist, it was only in the mind of the lobbiest.
GG
Of this I have no doubt. I cant find who it was. The Community Re-investment Act now that rings a bell.Basically the lefties said as you say the strict( sensible) lending criteria was engineered against the poor and particularly ethnic minorities. They then went after the banks very heavily under the Clinton Administration and cajoled with them with all kinds of ear bending. Bet she (it was a she I just cant remember who. It was in the Spectator Magazine) never thought she'd help ruin the economy.

Your are right Congress (all our governemnts basically) have a lot to answer for and I will keep screaming this till I'm blue in the face everytime the entire mess is entirely levelled at the Free Market System by idiots to try and bail said governments out of their own mess.

Last edited by copenhagen; 17 Feb 09 at 09:57..
  #5  
Old 17 Feb 09, 10:13
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Congress is most certainly to blame for some of it, but the predatory practices of the lending institutions cannot be laid off onto Congress. There is a story about a WWII vet in foreclosure on this morning's news that reads like the poster guy for evil banking victims.

It seems quite obvious from just Gunny's remarks that the lenders wanted this "forced" expansion under the umbrella of "the government made us do it", and that there was no shortage of employees willing to proceed into lending areas sorely lacking in integrity, ethics and honesty.

I salute you, Gunny, for living up to your standards. It's a real pity the rest of the industry couldn't meet those same standards.

The question uppermost in my mind at the moment, however, is how any of that predatory banking and lending will change under Obama? I don't see him bringing reality to the poor by making them follow the same lending standards as the rest of us, so I expect the "saved" lending industry to go right back into the same rotten line of work - "open under new management".
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Last edited by Mountain Man; 17 Feb 09 at 10:16..
  #6  
Old 17 Feb 09, 10:53
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It is natural to assume that anyone "hired" to do a job will do their damnedest to insure that the "Job" continues it's existance and that they will do the job. Note the sequence here..... it IS exact.

We then get "jobs" created to do a certain task. Let's say you are hired as a spokesperson for a group dedicated to insuring that "racism" is eradicated from the face of the Earth. Under the first paragraph's observations, it comes to follow that to insure the "job" remains intact, there MUST be racism to decry....... if there is none (Oh Oh!) we better find some quick or the "job" will dissappear! Once we find some "racism" we have to decry it loud and long..... it IS part of the job, you understand.

It is termed "preserving one's rice bowl". (I have long contended that fully half of EVERY Government beauracracy is just folks "preserving their rice bowls" and looking "busy" when they think anyone is watching.)

A couple of examples: When "Darlin' Jimmy Carter took office, one of the things he did was to require everyone in the various Government Agencies to "write up" what might be termed "job justification" reviews. (The objective was to reduce superfluous Government jobs.) Just from the small segment of what I could observe where I was at the time, in a mostly civilian Intelligence Agency, I can truthfully extrapolate, without exaggeration (too much) that in Washington DC alone, at least half a million man hours, twenty thousand "meetings" and a river of sweat was expended by various and assorted beaurocrats in the effort to "justify their rice bowls". We won't even go into the reams of paper, ink, "steno" time wasted also. (Even that was a waste, Government employees grew under Jimmy, like it always does.)

In the early 70's, when the civil rights movement was really getting into gear, a populist named Jesse Jackson gave a highly intelligent speech, directed to the black community. The thrust of the speech was that now that "equality" had been quaranteed, it was the time for the black community (Men in particular.) to come together, solidify their famlies, show some responsibility and (basically) get up and DO! (i.e. work)

I remember it well, for it was one of the times I could agree with some of the stuff Jackson was peddling. The counter blast at Jackson from newspapers, TV and radio commmentary in the Washington DC area was astonishing! He was accused of everyting from "Unca Tommin' " to being a "Honkie" in disguise. Such viciousness toward one of their won, I had not seen before.

The fact was, it WAS a justified observation on Jackson's part and the idea, from his point of view, was to point this out to the black community. It was the wrong answer as far as the black community was concerned. (My first exposure to Political Correctness.) Fearing for his support amongst his "constituency" (... and his "rice bowl"), Jackson backed down and, as far as I know, has never again uttered such heresy. (At least in public.)

GG
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  #7  
Old 17 Feb 09, 11:07
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Quote:
Originally Posted by Mountain Man View Post
Congress is most certainly to blame for some of it, but the predatory practices of the lending institutions cannot be laid off onto Congress. There is a story about a WWII vet in foreclosure on this morning's news that reads like the poster guy for evil banking victims.

It seems quite obvious from just Gunny's remarks that the lenders wanted this "forced" expansion under the umbrella of "the government made us do it", and that there was no shortage of employees willing to proceed into lending areas sorely lacking in integrity, ethics and honesty.

I salute you, Gunny, for living up to your standards. It's a real pity the rest of the industry couldn't meet those same standards.

The question uppermost in my mind at the moment, however, is how any of that predatory banking and lending will change under Obama? I don't see him bringing reality to the poor by making them follow the same lending standards as the rest of us, so I expect the "saved" lending industry to go right back into the same rotten line of work - "open under new management".
... and therein lies the point. If we try to reestablish the conditions leading up to this mess, we will, inevitably, repeat the mess.

.... and THAT leads us to what I have been preaching ever since I started posting in these threads, ALL of Amereica needs to readdress our committment to a solid work ethic (instead of Government dependancy), our apparent lack of business ethics (instead of anything goes) and the simple understanding that there are things in life that we cannot afford and stacking up obscene levels of personal debt to obtain them anyway is eventually gonna bite you on the behind.

Government might take these needed lessons to heart also.

GG
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  #8  
Old 17 Feb 09, 11:56
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MM: I AM somewhat interested in what you consider "predatory lending".

I keep hearing that term, but to me, it means "forcing" persons to buy into the terms of a contract. Since most banks do not operate under the auspices of "arm twisting" rules.... I AM in a quandry as to acertain your "take" on it.

As for my righteousness in my attitude, don't place too much into it. I could not debase my self centered sence of honor, it was true..... but, if I had not the self confidence to believe that I could find work if I "quit" the industry I had spent a great deal of my College time preparing for.... I would have become a prostitute, just like 95% of the bankers, and succomed to the edicts and resultant bank policies put on us by Congressional interference. (I say interference, because that is exactly what it was.)

For the bankers... it was a matter of making the best out of a bad situation. We must remember, despite Congress' willingness to weaken sound lending in favor of the uncreditworthy, the banks STILL had to make a profit if they wished to remain in business to satisfy their investors, owners and depositors. For those "senior bankers" it was a considerable effort to find ways to acceed to Congress' demands AND to keep the risk to a minimum. REALLY a matter of a rock and a hard place. (That it went a bit too far as it concerns inventiveness, I hold to be self evident. Bundled Mortgages, of high risk...... but.... somebody bought into them, did they not? Credit Swaps? PURE speculation. Very shakey. I fault the regulatory and "investment grading" agencies on that oversight failure.)

For me..... maybe it was just a case of cowardice. I wasn't senior enough to "make policy". I wasn't well connected enough to lead a bankers' revolt against the apparent wishes of Congress. I wasn't willing to lower my standards of fiduciary responsibility. I wasn't clever enough to invent all those esoteric loan types that would reduce bank risk and, at the same time, allow one to lend to shakey borrowers. Maybe I was the only one who was willing to project the (to me, anyway) obvious outcome of this into the future. So I got out of it. (Also known as "cut and run".)

.... and ALL of this would have been prevented if Congress had not been so eager to promote "social welfare" by interfering with sound lending practices AND (the other side of the coin) promoting the attitude of "easy credit" to keep the economy highly "heated" and (incidently) leveraged.

"Credit! One man's trust in another man." If that level of trust cannot be maintained, the system breaks.

We have a credit crunch? You bet, the banks have lost their trust in their borrowers..... Congress keeps changing the rules. Congress is "going to help" the troubled borrowers we keep hearing. Hasn't happened yet, except for some efforts to stop foreclosures. (Banks are not going to protest that too much, they already have a nice inventory of property to try to recoup their money on as it is. The LAST thing they want on their hands.)

The best thing Congress can do right now is to set the rules, finalize them and let the market decide how it is going to interpret those new rules. The market, efficient as always if let alone, will find a way. So, too, with business, so, too, with the banks.

But.....first of all, that mutual trust, bank to borrower, has to be reinvented. Congress can't legislate trust.

GG
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Last edited by Grognard Gunny; 17 Feb 09 at 12:14..
  #9  
Old 17 Feb 09, 12:18
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..... I am halfway through "Allas Shrugged", astonishing.

Change some of the "trappings" of the time line and incorporate the technological advances of today and it would be just as pertinent now as it was when written (1957).

Strongly recommended for Consevatives and Capitalists. Even more recommended for Socialists (you might learn something).

GG
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  #10  
Old 17 Feb 09, 17:54
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Not hearing from any of the die-hard argumentative libs on this one .......... wonder why?
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  #11  
Old 17 Feb 09, 21:02
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Quote:
Originally Posted by Grognard Gunny View Post
..... I am halfway through "Allas Shrugged", astonishing.

Change some of the "trappings" of the time line and incorporate the technological advances of today and it would be just as pertinent now as it was when written (1957).

Strongly recommended for Consevatives and Capitalists. Even more recommended for Socialists (you might learn something).

GG
I had quite a few chuckles to myself while reading it.

Here's some nastalgia:
http://query.nytimes.com/gst/fullpag...5AC0A96F958260

Quote:
''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''
http://query.nytimes.com/gst/fullpag...y%20mae&st=cse

I had Barney's quote as a signature awhile back. That's just a classic. It's almost as good as: “I will not send American boys to south east Asia to fight a war that Southeast Asian boys should be fighting..”-Lyndon B. Johnson
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  #12  
Old 18 Feb 09, 11:50
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Quote:
Originally Posted by Grognard Gunny View Post
MM: I AM somewhat interested in what you consider "predatory lending".

I keep hearing that term, but to me, it means "forcing" persons to buy into the terms of a contract. Since most banks do not operate under the auspices of "arm twisting" rules.... I AM in a quandry as to acertain your "take" on it.

As for my righteousness in my attitude, don't place too much into it. I could not debase my self centered sence of honor, it was true..... but, if I had not the self confidence to believe that I could find work if I "quit" the industry I had spent a great deal of my College time preparing for.... I would have become a prostitute, just like 95% of the bankers, and succomed to the edicts and resultant bank policies put on us by Congressional interference. (I say interference, because that is exactly what it was.)

For the bankers... it was a matter of making the best out of a bad situation. We must remember, despite Congress' willingness to weaken sound lending in favor of the uncreditworthy, the banks STILL had to make a profit if they wished to remain in business to satisfy their investors, owners and depositors. For those "senior bankers" it was a considerable effort to find ways to acceed to Congress' demands AND to keep the risk to a minimum. REALLY a matter of a rock and a hard place. (That it went a bit too far as it concerns inventiveness, I hold to be self evident. Bundled Mortgages, of high risk...... but.... somebody bought into them, did they not? Credit Swaps? PURE speculation. Very shakey. I fault the regulatory and "investment grading" agencies on that oversight failure.)

For me..... maybe it was just a case of cowardice. I wasn't senior enough to "make policy". I wasn't well connected enough to lead a bankers' revolt against the apparent wishes of Congress. I wasn't willing to lower my standards of fiduciary responsibility. I wasn't clever enough to invent all those esoteric loan types that would reduce bank risk and, at the same time, allow one to lend to shakey borrowers. Maybe I was the only one who was willing to project the (to me, anyway) obvious outcome of this into the future. So I got out of it. (Also known as "cut and run".)

.... and ALL of this would have been prevented if Congress had not been so eager to promote "social welfare" by interfering with sound lending practices AND (the other side of the coin) promoting the attitude of "easy credit" to keep the economy highly "heated" and (incidently) leveraged.

"Credit! One man's trust in another man." If that level of trust cannot be maintained, the system breaks.

We have a credit crunch? You bet, the banks have lost their trust in their borrowers..... Congress keeps changing the rules. Congress is "going to help" the troubled borrowers we keep hearing. Hasn't happened yet, except for some efforts to stop foreclosures. (Banks are not going to protest that too much, they already have a nice inventory of property to try to recoup their money on as it is. The LAST thing they want on their hands.)

The best thing Congress can do right now is to set the rules, finalize them and let the market decide how it is going to interpret those new rules. The market, efficient as always if let alone, will find a way. So, too, with business, so, too, with the banks.

But.....first of all, that mutual trust, bank to borrower, has to be reinvented. Congress can't legislate trust.

GG
Predatory lending, IMHO, is the practice of enticing people into loans using whatever means at hand, with total disregard for sound business practices, ethics, morals, scruples or anything else. The sole and total objective is to make the loan, and turn the fallout into an advantage as well. Something along the lines of a loan from one of the Sopranos. One way or another, the customer will be the only loser.

The explosive expansion of the credit and mortgage industries onto the market of poorly qualified or non-qualified buyers was clearly not for the benefit of the customers, since the house or other "durable goods" was always held hostage, and the interest is always collected first, thus coming under my personal definition of "predatory lending".

A better analogy might be to compare predatory lending to proper lending as one would compare "boiler room" stock sales to the legitimate stock market, or the practices of a dubious used car salesman to those of a reputable car dealer.

Like the old analogy about the prostitute and the politician, it all depends on who gets screwed when the money changes hands.
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  #13  
Old 18 Feb 09, 12:23
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slick_miester slick_miester is offline
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Originally Posted by Mountain Man View Post
The explosive expansion of the credit and mortgage industries onto the market of poorly qualified or non-qualified buyers was clearly not for the benefit of the customers, since the house or other "durable goods" was always held hostage, and the interest is always collected first, thus coming under my personal definition of "predatory lending".

A better analogy might be to compare predatory lending to proper lending as one would compare "boiler room" stock sales to the legitimate stock market, or the practices of a dubious used car salesman to those of a reputable car dealer.
I would submit that that is a poor analogy, since while not everyone can be expected to be expert in the fields of securities or automobiles, everyone should be expert in his or her own personal finances. It shouldn't take a doctorate in international finance or macroeconomics to figure out one's revenue, one's regular expenses, and whether or not added debt and interest payments can fit into that budget. In other words, even if the world's slickest real estate and mortgage brokers (which I'll gladly concede rank among the planet's lowest life forms) is working overtime to sink his hooks into you, if you're only grossing $40k/yr, then you've got to know that you can in no way afford a $400,000 home. It's just that simple.
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Old 18 Feb 09, 12:28
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Originally Posted by slick_miester View Post
I would submit that that is a poor analogy, since while not everyone can be expected to be expert in the fields of securities or automobiles, everyone should be expert in his or her own personal finances. It shouldn't take a doctorate in international finance or macroeconomics to figure out one's revenue, one's regular expenses, and whether or not added debt and interest payments can fit into that budget. In other words, even if the world's slickest real estate and mortgage brokers (which I'll gladly concede rank among the planet's lowest life forms) is working overtime to sink his hooks into you, if you're only grossing $40k/yr, then you've got to know that you can in no way afford a $400,000 home. It's just that simple.

I once went to an alumni meeting of my university for people working in the financial services industry. I talked to people in investment banking and well paid ones at that. I couldnt believe how little most of them knew about things as simple such how to use diversification of assets in terms of their own finances for example. Could hedge a multi million pound deal but not a clue about how to use fixed term investments for their own medium term savings.

Last edited by copenhagen; 18 Feb 09 at 12:30..
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Old 19 Feb 09, 12:31
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Quote:
Originally Posted by Grognard Gunny View Post
..... I am halfway through "Allas Shrugged", astonishing.

Change some of the "trappings" of the time line and incorporate the technological advances of today and it would be just as pertinent now as it was when written (1957).

Strongly recommended for Consevatives and Capitalists. Even more recommended for Socialists (you might learn something).

GG
how is Atlas Shrugged? I read Athem and thought it was pretty good
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