Frank's Fannie

The roots of this crisis go back to the Carter administration. That was when government officials, egged on by left-wing activists, began accusing mortgage lenders of racism and "redlining" because urban blacks were being denied mortgages at a higher rate than suburban whites.

The pressure to make more loans to minorities (read: to borrowers with weak credit histories) became relentless. Congress passed the Community Reinvestment Act, empowering regulators to punish banks that failed to "meet the credit needs" of "low-income, minority, and distressed neighborhoods." Lenders responded by loosening their underwriting standards and making increasingly shoddy loans. The two government-chartered mortgage finance firms, Fannie Mae and Freddie Mac, encouraged this "subprime" lending by authorizing ever more "flexible" criteria by which high-risk borrowers could be qualified for home loans, and then buying up the questionable mortgages that ensued.

Time and time again, Frank insisted that Fannie Mae and Freddie Mac were in good shape. Five years ago, for example, when the Bush administration proposed much tighter regulation of the two companies, Frank was adamant that "these two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis." When the White House warned of "systemic risk for our financial system" unless the mortgage giants were curbed, Frank complained that the administration was more concerned about financial safety than about housing.

Full Boston.com Story

Mr. H:

Not going to attempt to debate you, Mike, Jonathan and Pacman. I'm outnumbered here and will not tackle all of you on this. Just will say that while you all are accusing Barney Frank, Obama and just the Democratic side of the aisle, please be open-minded enough to include some of your Republican friends in these accusations. While I have no doubt that the accusations that you present are based on facts, there have been Republicans that have been involved also along the way. Perhaps you could mention them in your posts also as the posts seem to place all the blame on one party. Fair enough? Open- minded enough?

Vet:

"I suggest Fricker's, or the location of your choice.  I'll buy the beer!"

Pacman- Regarding the McCain information- just one question- McCain mentions the American Homeownership Resurgence Act-in the sixth paragraph, he mentions that "the Resurgence Plan will purchase the mortgages directly from homeowners and mortgage servicers and replace them with manageable fixed rate mortgages" etc.etc. He does not explain where this money will come from or who will provide the financing for this program. Can you explain in more detail how McCain will accomplish this and if it will cost more money to do so? IF, it costs the taxpayer more money, won't this add to the pot of taxpayer money that everyone is screaming about now? (ie.- the $700 billion + $140 billion pork added on)Is he saying he wants to spend more money on mortgage bailouts for homeowners that signed high risk loans? Why does he and others want to bail out these people with some of this money being paid in by people who DIDN't screw up and applied for legitimate loans that they could handle? Why give these irresponsible people a second chance to own a home and the financial lending places a second chance to make more bad loans and then, add insult to injury by asking the responsible people to help foot the bill?   

Vet, I am hearing about this for the first time today as you are.  I understand he mentioned this last night in the debate which I did not watch as I am personally campaigned out by both parties.

This all STINKS!!!

Pac:

Funny how the right thing to do is now perceived as the wrong thing.