SEC: Ex-Fannie And Freddie CEOs Misled Investors by Jim Zarroli
The only thing missing from this discussion is that the reason Fannie May and Freddie Mac got into the sub-prime mortgages, which was a social justice program by the Democratic Party called the Community Reinvestment Act that encouraged/required banks to make risky loans, which led to Fannie May and Freddie Mac guaranteeing these risky loans.
Many would like to blame Republicans and Capitalism for the Economic Disaster of 2008, but the facts confirm the problem was produced by Democrats and Socialism.
---------------------------------------
SEC: Ex-Fannie And Freddie CEOs Misled Investors by Jim Zarroli
http://www.npr.org/2011/12/17/143877335/sec-ex-fannie-and-freddie-ceos-mislead-investors?ps=cprs
December 17, 2011
Ever since Fannie Mae and Freddie Mac were taken over by the government in 2008, questions have swirled over who was responsible for the collapse. Friday, the Securities and Exchange Commission weighed in, filing fraud charges against former Fannie Mae CEO Daniel Mudd, Richard Syron — ex-chief executive at Freddie Mac — and four other former executives.
Federal officials say the companies lied to investors about the number of subprime loans they had on their books at the height of the credit boom. They also say the executives knew what was happening and even encouraged the deception.
The SEC says both companies loaded up their balance sheets with many billions of dollars in risky subprime mortgages. By 2007, investors were starting to ask questions, says Guy Cecala, publisher of Inside Mortgage Finance.
"If investors knew that Fannie Mae and Freddie Mac were effectively engaging in risky behavior, they would have theoretically reduced their holdings of their stock," he says.
So, the SEC says, both companies took pains to conceal their holdings from the public. SEC enforcement director Robert Khuzami said Freddie Mac reported in its 2006 annual report that its subprime holdings were not significant.
"In fact, the company had $141 billion of subprime exposure to loans it internally described as 'subprime' or 'subprime-like,' representing 10 percent of its single-family portfolio as of Dec. 31, 2006," Khuzami said.
He said Syron and his two colleagues at the company were well aware of how risky its portfolio was.
"Despite this knowledge, our complaint asserts that these three executives gave speeches and statements to the investing public that boasted of Freddie Mac's low-risk mortgage loan portfolio," Khuzami said.
The SEC says both companies were selective about what they revealed to investors. Fannie Mae allegedly acknowledged a small number of subprime loans, but failed to tell investors it also held risky Alternative-A mortgages, which require little or no documentation of a borrower's income. SEC officials suggest that these executives had an incentive to mislead investors.
"They're basically saying that the senior executives at Fannie Mae and Freddie Mac during this period consciously withheld this information [from] shareholders because it would hurt the value of the company's stock and hurt the compensation that these executives received," Cecala says.
Mudd and lawyers for Syron issued statements criticizing the SEC. They noted that during their tenure, the companies had repeatedly issued disclosure statements that government regulators had signed off on.
The charges are certain to revive the debate about Fannie Mae and Freddie Mac's future. Critics have long complained about the hybrid nature of the enterprises, which were chartered by the government as independent companies. Since 2008, the government has assumed control of the companies, and taxpayers have had to pay out more than $150 billion to prop them up.
Susan Wachter is a professor of financial management at the University of Pennsylvania's Wharton School.
"So this has to be solved going forward. I think there's a lot of controversy and discussion about different solutions and how best to resolve the problem," she says, "but the model as it was out there — this is another indicator of how shaky that model was."
Still, Fannie and Freddie continue to play a vital role in the housing market, providing liquidity that makes it easier for banks to issue mortgages. As long as the housing market remains so weak, no one wants to tamper with that model.
Saturday, December 17, 2011
Friday, July 29, 2011
Fannie/Freddie regulator sues UBS on $900 million loss
Fannie/Freddie regulator sues UBS on $900 million loss
Now this is interesting. The heart of the question is who lied first.
I still believe the problem was created by the Community Reinvestment Act, a piece of Social Justice legislation by Democrats that encouraged/forced banks to make sub prime loans.
Too often, people will let a lie stand, so long as they get a benefit from the lie. It takes a big man to expose a lie even if they do get a benefit from the lie.
Everyone was benefitting from the housing bubble, but now everyone is hurting from the housing market bubble.
---------------------------------------------------------
Fannie/Freddie regulator sues UBS on $900 million loss
ReutersBy Jonathan Stempel | Reuters – Wed, Jul 27, 2011
http://news.yahoo.com/ubs-sued-over-900-mln-fannie-freddie-loss-173400491.html
NEW YORK (Reuters) - The regulator for Fannie Mae and Freddie Mac sued UBS AG to recover more than $900 million of losses after the Swiss bank misled the housing agencies into buying $4.5 billion of risky mortgage debt.
In announcing Wednesday's lawsuit, the U.S. Federal Housing Finance Agency said it also plans more lawsuits to recover additional losses by Fannie Mae and Freddie Mac from investments in private-label debt.
Last July, the FHFA issued 64 subpoenas to banks, seeking details about subprime and other mortgage debt that Fannie Mae and Freddie Mac bought when the housing market was healthy.
The UBS case is part of a push by Washington to hold banks responsible for the nation's housing problems. It is also the latest effort to prop up the government-sponsored enterprises (GSEs), whose September 2008 federal seizure has so far cost taxpayers more than $135 billion.
"From the issuance of 64 subpoenas last year to the filing of this lawsuit and further actions to come, we continue to seek redress for the losses suffered," FHFA Acting Director Edward DeMarco said in a statement.
The GSEs remain crucial to the housing market, having in 2010 guaranteed 70 percent of single-family mortgage-backed securities that were issued, and provided $1.03 trillion of market liquidity, an FHFA report to Congress last month shows.
UBS spokesman Peter McKillop had no immediate comment. FHFA spokeswoman Corinne Russell declined further comment.
In May, the government filed a fraud lawsuit accusing Deutsche Bank AG of misleading the Federal Housing Administration into believing many low-quality mortgages issued by the German bank's MortgageIT unit qualified for insurance. Deutsche Bank is seeking to dismiss that case.
According to the UBS complaint, Fannie Mae and Freddie Mac lost more than 20 percent of their investment in over $4.5 billion of residential mortgage-backed securities that the bank sold in 16 securitizations from September 2005 to August 2007.
Filed in the U.S. District Court in Manhattan, the complaint also said UBS failed to do adequate due diligence, and hid or misstated the quality of the underlying loans and underwriting, as well as borrowers' ability to make payments.
Many of the loans were issued by lenders that later failed or went bankrupt, including American Home Mortgage Investment Corp, IndyMac Bancorp Inc and New Century Financial Corp.
According to the complaint, a review of 966 randomly chosen loans from two "triple-A" rated securitizations in 2006 and 2007 found that 78 percent were not underwritten properly.
By May 2011, the complaint said, these securitizations were rated "CCC" by Standard & Poor's and "Ca" by Moody's Investors Service, among the lowest junk grades.
"Fannie Mae and Freddie Mac did not know of the untruths and omissions," the complaint said. "If the GSEs would have known of those untruths and omissions, they would not have purchased the GSE certificates."
The lawsuit seeks to recoup Fannie Mae's and Freddie Mac's losses and undo the purchases, among other remedies.
Other banks including Bank of America Corp and its Countrywide unit have faced lawsuits by investors who claim to have lost money on mortgage-backed debt.
Republican lawmakers in Washington have been trying to reduce taxpayer support for Fannie Mae and Freddie Mac and attract more private capital to the $10.6 trillion residential mortgage market. The Treasury Department pledged in December 2009 to provide unlimited aid to the GSEs through 2012.
The case is Federal Housing Finance Agency v. UBS Americas Inc et al, U.S. District Court, Southern District of New York, No. 11-05201.
(Reporting by Jonathan Stempel; Editing by Gerald E. McCormick, Richard Chang and Matthew Lewis)
Now this is interesting. The heart of the question is who lied first.
I still believe the problem was created by the Community Reinvestment Act, a piece of Social Justice legislation by Democrats that encouraged/forced banks to make sub prime loans.
Too often, people will let a lie stand, so long as they get a benefit from the lie. It takes a big man to expose a lie even if they do get a benefit from the lie.
Everyone was benefitting from the housing bubble, but now everyone is hurting from the housing market bubble.
---------------------------------------------------------
Fannie/Freddie regulator sues UBS on $900 million loss
ReutersBy Jonathan Stempel | Reuters – Wed, Jul 27, 2011
http://news.yahoo.com/ubs-sued-over-900-mln-fannie-freddie-loss-173400491.html
NEW YORK (Reuters) - The regulator for Fannie Mae and Freddie Mac sued UBS AG to recover more than $900 million of losses after the Swiss bank misled the housing agencies into buying $4.5 billion of risky mortgage debt.
In announcing Wednesday's lawsuit, the U.S. Federal Housing Finance Agency said it also plans more lawsuits to recover additional losses by Fannie Mae and Freddie Mac from investments in private-label debt.
Last July, the FHFA issued 64 subpoenas to banks, seeking details about subprime and other mortgage debt that Fannie Mae and Freddie Mac bought when the housing market was healthy.
The UBS case is part of a push by Washington to hold banks responsible for the nation's housing problems. It is also the latest effort to prop up the government-sponsored enterprises (GSEs), whose September 2008 federal seizure has so far cost taxpayers more than $135 billion.
"From the issuance of 64 subpoenas last year to the filing of this lawsuit and further actions to come, we continue to seek redress for the losses suffered," FHFA Acting Director Edward DeMarco said in a statement.
The GSEs remain crucial to the housing market, having in 2010 guaranteed 70 percent of single-family mortgage-backed securities that were issued, and provided $1.03 trillion of market liquidity, an FHFA report to Congress last month shows.
UBS spokesman Peter McKillop had no immediate comment. FHFA spokeswoman Corinne Russell declined further comment.
In May, the government filed a fraud lawsuit accusing Deutsche Bank AG of misleading the Federal Housing Administration into believing many low-quality mortgages issued by the German bank's MortgageIT unit qualified for insurance. Deutsche Bank is seeking to dismiss that case.
According to the UBS complaint, Fannie Mae and Freddie Mac lost more than 20 percent of their investment in over $4.5 billion of residential mortgage-backed securities that the bank sold in 16 securitizations from September 2005 to August 2007.
Filed in the U.S. District Court in Manhattan, the complaint also said UBS failed to do adequate due diligence, and hid or misstated the quality of the underlying loans and underwriting, as well as borrowers' ability to make payments.
Many of the loans were issued by lenders that later failed or went bankrupt, including American Home Mortgage Investment Corp, IndyMac Bancorp Inc and New Century Financial Corp.
According to the complaint, a review of 966 randomly chosen loans from two "triple-A" rated securitizations in 2006 and 2007 found that 78 percent were not underwritten properly.
By May 2011, the complaint said, these securitizations were rated "CCC" by Standard & Poor's and "Ca" by Moody's Investors Service, among the lowest junk grades.
"Fannie Mae and Freddie Mac did not know of the untruths and omissions," the complaint said. "If the GSEs would have known of those untruths and omissions, they would not have purchased the GSE certificates."
The lawsuit seeks to recoup Fannie Mae's and Freddie Mac's losses and undo the purchases, among other remedies.
Other banks including Bank of America Corp and its Countrywide unit have faced lawsuits by investors who claim to have lost money on mortgage-backed debt.
Republican lawmakers in Washington have been trying to reduce taxpayer support for Fannie Mae and Freddie Mac and attract more private capital to the $10.6 trillion residential mortgage market. The Treasury Department pledged in December 2009 to provide unlimited aid to the GSEs through 2012.
The case is Federal Housing Finance Agency v. UBS Americas Inc et al, U.S. District Court, Southern District of New York, No. 11-05201.
(Reporting by Jonathan Stempel; Editing by Gerald E. McCormick, Richard Chang and Matthew Lewis)
Wednesday, July 27, 2011
S&P involvement with Financial Disaster of 2008
The following statements are the first time I had seen S&P involvement in Financial Disaster of 2008. It would appear the whole financial industry was involved.
The threat of a downgrade has made Standard & Poor's a target for critics chafing at demands from a company that blessed the mortgage-backed securities that led to the financial crisis.
S&P Hill Critics
An April report by Senator Carl Levin, a Michigan Democrat, and Senator Tom Coburn, an Oklahoma Republican, concluded the credit agencies "weakened their standards as each competed to provide the most favorable rating to win business and greater market share. The result was a race to the bottom."
Stock Market is Really Just a Gambling Hall
A long time ago, I learned the stock market was just a legalized gambling hall, where the house (stock brokers) had the advantage.
I made a little money, but the big money was made by the stock brokerage companies.
The question is how to reduce the power of the investment organizations, but not kill the investment engine that creates prosperity. Obama tried to take on Wall Street and lost.
The problem is that Wall Street can manipulate both Democrats and Republicans so that Wall Street wins.
-----------------------------------------
U.S. Credit Rating Rides on S&P's London View of Politics on Capitol Hill
By Brian Faler - Jul 27, 2011 12:01 AM ET
http://www.bloomberg.com/news/2011-07-27/u-s-credit-rating-rests-on-s-p-s-london-view-of-washington.html
David Beers may be the most influential political commentator in the U.S. right now, even though he's hardly a household name, that isn't technically his job and he's only visiting.
As the London-based managing director of sovereign credit ratings at Standard & Poor's, Beers will help determine whether the U.S. government's credit rating will be downgraded as a result of the battle over raising the debt limit.
His company has gone beyond competing credit rating agencies to say that it isn't enough for lawmakers to agree to lift the government's $14.3 trillion debt ceiling. Congress and the White House also must agree to a deficit-reduction package to avoid a downgrade in the government's AAA credit rating.
In an interview this week at Union Station, just blocks from the U.S. Capitol, Beers said he views the debt limit fight as a test of lawmakers' willingness to tackle the deficit.
"For us, the issue is not the debt limit -- it's the underlying fiscal dynamics," said Beers, who has been rating governments for the company for 20 years. "It's not obvious to us that this political divide that is proving so difficult to bridge is going to be any more bridgeable three months from now or six months from now or a year from now."
He said he didn't know when an S&P committee would decide whether to cut the credit rating. "Depends on events," he said.
Downgrade Impact
A decision to cut the government's credit rating would likely increase Treasury rates by 60 to 70 basis points over the "medium term," raising the nation's borrowing costs by $100 billion a year, JPMorgan Chase & Co.'s Terry Belton said. It could also hurt the rest of the economy by increasing the cost of mortgages, auto loans and other types of lending tied to the interest rates paid on treasuries.
Yesterday, the markets showed little debt ceiling concerns, as seen in 10-year Treasury note yields hovering around 3 percent, below the average of 4.05 percent over the last decade, and the average of 5.48 percent when the country was running budget surpluses between 1998 and 2001.
On Capitol Hill, House and Senate leaders were trying to advance deficit reduction packages that would clear the way for a vote on the debt ceiling increase that the Treasury Department says must come by Aug 2.
The threat of a downgrade has made Standard & Poor's a target for critics chafing at demands from a company that blessed the mortgage-backed securities that led to the financial crisis.
S&P Hill Critics
An April report by Senator Carl Levin, a Michigan Democrat, and Senator Tom Coburn, an Oklahoma Republican, concluded the credit agencies "weakened their standards as each competed to provide the most favorable rating to win business and greater market share. The result was a race to the bottom."
In an interview, Levin said he views those faults as conflicts of interest issues that are separate from the S&P's sovereign ratings work, which he declined to criticize. "My gut tells me that they're calling it as they see it and, hopefully, they're not impacted by their previous failures to call them as they should have seen it," Levin said.
Senate Majority Leader Harry Reid, a Nevada Democrat, took a different view. "I wish they had made a few demands when Wall Street was collapsing," said Reid. "They were silent then. Maybe they're trying to get more energized."
July Warning
At issue is a warning the company issued July 14 that there is a 50 percent chance S&P would downgrade the government's credit rating within three months if lawmakers didn't approve a "credible" deficit reduction package as part of a plan to raise the debt cap.
It was the latest in a series of demands from the company over the past year. In April, S&P said there was a one-in-three chance it would downgrade the government within two years; in October, it said lawmakers had as many as five years to address long-term deficits.
In its July report, the company said, "We believe that an inability to reach an agreement now could indicate that an agreement will not be reached for several more years."
Critics say the company is misreading the political dynamics in Washington and that it shouldn't engage in political prognosticating at all.
"If we fail to increase the debt ceiling, they have every right to take the U.S. down as many notches as they want," said Jared Bernstein, former economic advisor to Vice President Joe Biden. "I don't look to S&P for political analysis" and "their job is not to try to do political crystal-ball gazing. Their job is to assess the reliability of U.S. debt."
U.S. Can Meet Obligations
Bernstein said, "Nothing fundamental has changed in the ability of the U.S. government to fully meet its debt obligations."
IHS Global Insight Chief Economist Nariman Behravesh said S&P has unrealistic demands because lawmakers are unlikely to agree to a major deficit reduction package until after next year's elections. "If they really think there is going to be a comprehensive solution before 2012, they are grossly mistaken," he said.
Where Beers sees ominous gridlock over the debt, Behravesh sees progress. "Think about where we were six months ago: We were talking about stimulus," he said. "The good news is U.S. politicians are talking" about trillion-dollar budget cuts.
He said S&P is "itching to pull the trigger" on a credit downgrade, saying "it's almost like they're overreacting in the other direction" in order "to make up for past errors."
Former Congressional Budget Office Director Doug Holtz- Eakin, who advised the 2010 Republican presidential campaign of John McCain, said S&P is right to question the political will in Congress to address the deficit because it's the central question surrounding the debt.
Political Wherewithal
"There is no question that the U.S. economy remains the largest, strongest on the globe and it has the financial wherewithal to pay its debts," he said. "The question is, is that financial wherewithal matched by political wherewithal? And that's what they're trying to find out."
Beers said critics of the company's record during the housing crisis "know nothing about our sovereign ratings, which have an excellent track record." He said it's impossible to assess a government's credit rating without making judgments about its politics.
"Economic policy is part of a political process," he said. "Every government has to make choices, and it has to do it in some political context, and we have to look at that and decide how plausible that is."
‘Sheer Difficulty'
The gridlock over the debt limit "highlights the sheer difficulty" lawmakers are having coming to agreement, he said, which has prompted S&P to shorten the timeframe over which it wants to see major cuts. He is skeptical that next year's election will be "that decisive on this issue."
U.S. lawmakers are lagging behind other similarly rated governments that have also faced debt challenges, he said, pointing to countries such as Britain that are implementing plans to tighten budgets.
"This whole issue of finding common ground has been on the table since March and it's not as if people aren't trying," he said. "You have to make judgments about these sorts of things."
To contact the reporter on this story: Brian Faler in Washington at bfaler@bloomberg.net
The following statements are the first time I had seen S&P involvement in Financial Disaster of 2008. It would appear the whole financial industry was involved.
The threat of a downgrade has made Standard & Poor's a target for critics chafing at demands from a company that blessed the mortgage-backed securities that led to the financial crisis.
S&P Hill Critics
An April report by Senator Carl Levin, a Michigan Democrat, and Senator Tom Coburn, an Oklahoma Republican, concluded the credit agencies "weakened their standards as each competed to provide the most favorable rating to win business and greater market share. The result was a race to the bottom."
Stock Market is Really Just a Gambling Hall
A long time ago, I learned the stock market was just a legalized gambling hall, where the house (stock brokers) had the advantage.
I made a little money, but the big money was made by the stock brokerage companies.
The question is how to reduce the power of the investment organizations, but not kill the investment engine that creates prosperity. Obama tried to take on Wall Street and lost.
The problem is that Wall Street can manipulate both Democrats and Republicans so that Wall Street wins.
-----------------------------------------
U.S. Credit Rating Rides on S&P's London View of Politics on Capitol Hill
By Brian Faler - Jul 27, 2011 12:01 AM ET
http://www.bloomberg.com/news/2011-07-27/u-s-credit-rating-rests-on-s-p-s-london-view-of-washington.html
David Beers may be the most influential political commentator in the U.S. right now, even though he's hardly a household name, that isn't technically his job and he's only visiting.
As the London-based managing director of sovereign credit ratings at Standard & Poor's, Beers will help determine whether the U.S. government's credit rating will be downgraded as a result of the battle over raising the debt limit.
His company has gone beyond competing credit rating agencies to say that it isn't enough for lawmakers to agree to lift the government's $14.3 trillion debt ceiling. Congress and the White House also must agree to a deficit-reduction package to avoid a downgrade in the government's AAA credit rating.
In an interview this week at Union Station, just blocks from the U.S. Capitol, Beers said he views the debt limit fight as a test of lawmakers' willingness to tackle the deficit.
"For us, the issue is not the debt limit -- it's the underlying fiscal dynamics," said Beers, who has been rating governments for the company for 20 years. "It's not obvious to us that this political divide that is proving so difficult to bridge is going to be any more bridgeable three months from now or six months from now or a year from now."
He said he didn't know when an S&P committee would decide whether to cut the credit rating. "Depends on events," he said.
Downgrade Impact
A decision to cut the government's credit rating would likely increase Treasury rates by 60 to 70 basis points over the "medium term," raising the nation's borrowing costs by $100 billion a year, JPMorgan Chase & Co.'s Terry Belton said. It could also hurt the rest of the economy by increasing the cost of mortgages, auto loans and other types of lending tied to the interest rates paid on treasuries.
Yesterday, the markets showed little debt ceiling concerns, as seen in 10-year Treasury note yields hovering around 3 percent, below the average of 4.05 percent over the last decade, and the average of 5.48 percent when the country was running budget surpluses between 1998 and 2001.
On Capitol Hill, House and Senate leaders were trying to advance deficit reduction packages that would clear the way for a vote on the debt ceiling increase that the Treasury Department says must come by Aug 2.
The threat of a downgrade has made Standard & Poor's a target for critics chafing at demands from a company that blessed the mortgage-backed securities that led to the financial crisis.
S&P Hill Critics
An April report by Senator Carl Levin, a Michigan Democrat, and Senator Tom Coburn, an Oklahoma Republican, concluded the credit agencies "weakened their standards as each competed to provide the most favorable rating to win business and greater market share. The result was a race to the bottom."
In an interview, Levin said he views those faults as conflicts of interest issues that are separate from the S&P's sovereign ratings work, which he declined to criticize. "My gut tells me that they're calling it as they see it and, hopefully, they're not impacted by their previous failures to call them as they should have seen it," Levin said.
Senate Majority Leader Harry Reid, a Nevada Democrat, took a different view. "I wish they had made a few demands when Wall Street was collapsing," said Reid. "They were silent then. Maybe they're trying to get more energized."
July Warning
At issue is a warning the company issued July 14 that there is a 50 percent chance S&P would downgrade the government's credit rating within three months if lawmakers didn't approve a "credible" deficit reduction package as part of a plan to raise the debt cap.
It was the latest in a series of demands from the company over the past year. In April, S&P said there was a one-in-three chance it would downgrade the government within two years; in October, it said lawmakers had as many as five years to address long-term deficits.
In its July report, the company said, "We believe that an inability to reach an agreement now could indicate that an agreement will not be reached for several more years."
Critics say the company is misreading the political dynamics in Washington and that it shouldn't engage in political prognosticating at all.
"If we fail to increase the debt ceiling, they have every right to take the U.S. down as many notches as they want," said Jared Bernstein, former economic advisor to Vice President Joe Biden. "I don't look to S&P for political analysis" and "their job is not to try to do political crystal-ball gazing. Their job is to assess the reliability of U.S. debt."
U.S. Can Meet Obligations
Bernstein said, "Nothing fundamental has changed in the ability of the U.S. government to fully meet its debt obligations."
IHS Global Insight Chief Economist Nariman Behravesh said S&P has unrealistic demands because lawmakers are unlikely to agree to a major deficit reduction package until after next year's elections. "If they really think there is going to be a comprehensive solution before 2012, they are grossly mistaken," he said.
Where Beers sees ominous gridlock over the debt, Behravesh sees progress. "Think about where we were six months ago: We were talking about stimulus," he said. "The good news is U.S. politicians are talking" about trillion-dollar budget cuts.
He said S&P is "itching to pull the trigger" on a credit downgrade, saying "it's almost like they're overreacting in the other direction" in order "to make up for past errors."
Former Congressional Budget Office Director Doug Holtz- Eakin, who advised the 2010 Republican presidential campaign of John McCain, said S&P is right to question the political will in Congress to address the deficit because it's the central question surrounding the debt.
Political Wherewithal
"There is no question that the U.S. economy remains the largest, strongest on the globe and it has the financial wherewithal to pay its debts," he said. "The question is, is that financial wherewithal matched by political wherewithal? And that's what they're trying to find out."
Beers said critics of the company's record during the housing crisis "know nothing about our sovereign ratings, which have an excellent track record." He said it's impossible to assess a government's credit rating without making judgments about its politics.
"Economic policy is part of a political process," he said. "Every government has to make choices, and it has to do it in some political context, and we have to look at that and decide how plausible that is."
‘Sheer Difficulty'
The gridlock over the debt limit "highlights the sheer difficulty" lawmakers are having coming to agreement, he said, which has prompted S&P to shorten the timeframe over which it wants to see major cuts. He is skeptical that next year's election will be "that decisive on this issue."
U.S. lawmakers are lagging behind other similarly rated governments that have also faced debt challenges, he said, pointing to countries such as Britain that are implementing plans to tighten budgets.
"This whole issue of finding common ground has been on the table since March and it's not as if people aren't trying," he said. "You have to make judgments about these sorts of things."
To contact the reporter on this story: Brian Faler in Washington at bfaler@bloomberg.net
Thursday, May 12, 2011
Discrimination on Basis of Ability to Pay is Just
Discrimination on Basis of Ability to Pay is Just
Discrimination of the bases of ability to pay back a loan should be legal. Democrats are dumber than dirt when they think hope people that do not quality for loans will pay back the loans.
This is not a Civil Rights issue but rather a economics issue.
Democrats loan money to people they hope will pay back the money and Republicans loan money to people they expect will pay back the money. Big Difference.
The Economic Disaster of 2008 was proof that sub prime loans are very very bad. The 1977 Community Reinvestment Act (CRA) started under the Carter Administration and was strengthened under the Clinton Administration. Every American has suffered because of this lousily piece of legislation that was created by democrats to buy black votes.
The Democrats can spin this issue as a discrimination issue, but they need to be called stupid and never ever be allowed to have control of the government.
------------------------------------
A Renewed Crackdown on Redlining
In the wake of the subprime implosion, the Obama Administration has stepped up its scrutiny of disadvantaged neighborhoods' credit access
By Clea Benson
BW Magazine
May 9, 2011
Community activists in St. Louis became concerned a couple of years ago that local banks weren't offering credit to the city's poor and African American residents. So they formed a group called the St. Louis Equal Housing and Community Reinvestment Alliance and began writing complaint letters to federal regulators.
Apparently, someone in Washington took notice. The Federal Reserve has cited one of the group's targets, Midwest BankCentre, a small bank that has been operating in St. Louis's predominantly white, middle-class suburbs for over a century, for failing to issue home mortgages or open branches in disadvantaged areas. Although executives at the bank say they don't discriminate, Midwest BankCentre's latest annual report says it is in the process of negotiating a settlement with the U.S. Justice Dept. over its lending practices.
The 1977 Community Reinvestment Act (CRA) requires banks to make loans in all the areas they serve, not just the wealthy ones. A Bloomberg analysis found the percentage of banks earning negative ratings from regulators on CRA exams has risen from 1.45 percent in 2007 to more than 6 percent in the first quarter of this year.
Discrimination of the bases of ability to pay back a loan should be legal. Democrats are dumber than dirt when they think hope people that do not quality for loans will pay back the loans.
This is not a Civil Rights issue but rather a economics issue.
Democrats loan money to people they hope will pay back the money and Republicans loan money to people they expect will pay back the money. Big Difference.
The Economic Disaster of 2008 was proof that sub prime loans are very very bad. The 1977 Community Reinvestment Act (CRA) started under the Carter Administration and was strengthened under the Clinton Administration. Every American has suffered because of this lousily piece of legislation that was created by democrats to buy black votes.
The Democrats can spin this issue as a discrimination issue, but they need to be called stupid and never ever be allowed to have control of the government.
------------------------------------
A Renewed Crackdown on Redlining
In the wake of the subprime implosion, the Obama Administration has stepped up its scrutiny of disadvantaged neighborhoods' credit access
By Clea Benson
BW Magazine
May 9, 2011
Community activists in St. Louis became concerned a couple of years ago that local banks weren't offering credit to the city's poor and African American residents. So they formed a group called the St. Louis Equal Housing and Community Reinvestment Alliance and began writing complaint letters to federal regulators.
Apparently, someone in Washington took notice. The Federal Reserve has cited one of the group's targets, Midwest BankCentre, a small bank that has been operating in St. Louis's predominantly white, middle-class suburbs for over a century, for failing to issue home mortgages or open branches in disadvantaged areas. Although executives at the bank say they don't discriminate, Midwest BankCentre's latest annual report says it is in the process of negotiating a settlement with the U.S. Justice Dept. over its lending practices.
The 1977 Community Reinvestment Act (CRA) requires banks to make loans in all the areas they serve, not just the wealthy ones. A Bloomberg analysis found the percentage of banks earning negative ratings from regulators on CRA exams has risen from 1.45 percent in 2007 to more than 6 percent in the first quarter of this year.
Subscribe to:
Posts (Atom)