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And don’t forget the pressure the Department of Housing and Urban Development placed on lenders once the Clinton administration expanded the terms of the Community Reinvestment Act.
All this has been swept under the proverbial rug while busloads of MoveOn.org activists travel through exclusive neighborhoods in Fairfield County, Connecticut looking for people who got bonuses from AIG, bonuses that the Obama administration and the Democrats who control the Congress originally said it was okay
Anyway, they all have it wrong. Ross Perot years ago talked about a "giant sucking sound" but little did he know that it was only the beginning of a long intake so that one day the winds of change could blow.
Greedy people, incompetent legislation, incompetent oversight, voters, Republicans, Democrats, Corporations, stock market, lying buyers, lying mortgage companies.. IMO it is a combination of things and people that are to blame for the mess.
The focus of blame for the mess we are in remains on the Bush administration, A.I.G., Lehman Brothers and greedy CEOs.
Economists say the break didn’t cause the bubble, but creating tax-free windfalls alongside low interest rates and lax lending standards cultivated an environment ripe for over-speculation—with one study finding the tax cut alone increased sales 17% from 1997-2007.
Mr. Greenspan and other Fed officials repeatedly dismissed warnings about a speculative bubble in housing prices. In December 2004, the New York Fed issued a report bluntly declaring that “no bubble exists.” Mr. Greenspan predicted several times — incorrectly, it turned out — that housing declines would be local but almost certainly not nationwide.
With the support of Federal Reserve Chairman Alan Greenspan, President Bush pushed through a tax cut designed to benefit the richest Americans but not to lift the economy out of the recession that followed the collapse of the Internet bubble. Given that mistake, the Fed had little choice if it was to fulfill its mandate to maintain growth and employment: It had to lower interest rates, which it did in an unprecedented way -- all the way down to 1 percent.
Originally posted by justsomeboreddude
I would say this whole mess with the government is OUR fault.
Originally posted by plumranch
Who's REALLY to Blame for the Subprime Mess?
The 1999 Gramm-Leach-Bliley Act, however, put the parent holding company of each of the big American brokerages beyond SEC oversight. In order for the agreement to go ahead, the investment banks lobbied for a decision that would allow "voluntary" inspection of their parent and subsidiary holdings by the SEC.
During this repeal of the net capital rule, SEC Chairman William H. Donaldson agreed to the establishment of a risk management office that would monitor signs of future problems. This office was eventually dismantled by Chairman Christopher Cox, after discussions with Paulson.
The 1999 Gramm-Leach-Bliley Act, however, put the parent holding company of each of the big American brokerages beyond SEC oversight.
reply to post by Southern Guardian
Many on the right side of the ideological plain claimed it to be Clintons fault in that his tax break legislation was made into law in 1997. By this in the new legislation owners selling their homes will need not pay capital-gains taxes on profits up to $500,000.
That's not factual as far as I am aware. He worked as a lawyer for ACORN to make sure there was no discrimination from banks as to who they lent to. Unless you are equating the two?
So it is important that people be reminded of the facts. And Congress needs to look into the whole sorry mess, and in a way that is designed to get at the truth, not shield the wrongdoers. They could begin by looking at the establishment, in 1994, of the Home Loan Secondary Market Program by a group called the Self-Help Credit Union.