How Exactly Did Bush Cause This recession?

OK enlighten us. I have stated how unconstitutional Democrat social engineering and wealth distribution schemes added a huge amount of liquidity into the housing market creating the price bubble. I have listed chapter and verse. Freddie and Fannie once held 1 out of every 2 mortgages in the country. A lot of power for two unconstitutional Government Sponsored Entities. Tell us how "Repubs were responsible."

 

Your argument that the Founders could never have foreseen the changes in society so they could not have included such changes in the Constitution is illegitimate. The faulty argument suggests that the founders WOULD HAVE included Democrat violations of the Constitution if they only wrote the document today. That argument is ridiculous. The Founders sought to safeguard individual liberty, not the unlimited power of the State.

The Founders based the Constitution on history and human nature both of which repeat. They also knew times would change which is why they allowed the Constitution to become amended by following Article 5. Passing and ratifying amendments is difficult, but it has been done 27 times throughout our history. Of course each amendment MUST be passed by two-thirds of both houses of Congress, and two thirds of the states, or 34 states. Take Obamacare for example. Democrats could never get 34 states to agree to Obamacare since 27 states are actively suing the federal government to stop the legislation leaving only 23 that MIGHT decide to ratify any such amendment. I’m sure passing actual amendments to allow Social Security and other “entitlements” no one has a right to receive would also be equally as difficult especially since they are all going bankrupt and are well on their way to destroying this country economically.

Liberals don’t care about the law. They think they are smarter than the rest of us and certainly the Founders. They believe they are right, and therefore that belief or “faith” (“faith” in themselves, not God… )makes them believe they are above the law.

If something was necessary for the survival of the country an amendment to add that POWER to the Constitution would occur almost overnight; probably within hours. For example an “Air Force” is not technically constitutional. The Constitution allows Congress “To raise and support Armies,” and “To provide and maintain a Navy;” or to provide for land AND sea military forces. No need to provide for an Air Force since there was no such things as airplanes. If the Supreme Court suddenly ruled that the Air Force was unconstitutional I am quite sure Congress would pass a one or two sentence amendment in a few hours, and that amendment would be simultaneously ratified in all 50 States (after receiving the text via fax or email… ). The argument that the Constitution is outdated is incorrect. The Constitution just shows Liberal Anti-Constitutionalists don’t have the support to totally repel the Constitution.

 

Federal reserve and greenspan lowering rates caused recession...they blew up a bubble and then popped it by suddenly raising rates. Must be nice to have that kind of power. Wonder who benefited? Must be nice for the banks(largest wall street banks) to rake in the profits for themselves(privatizing profits) and passing off the losses to the taxpayers(bailouts).

Sounds like a rigged game to me.

Wait till the next bubble pops(US debt).....

Can't keep rates low for this long without dire consequences.

 

From Post #123

Ah, but the FED did not lower loan standards. Freddie and Fannie enticed banks to make risky loans for the bank's PROFIT! Also, Democrat Clinton changing the CRA enforcement FORCED banks to lower standards to make their needed numbers, and of course if banks did not make risky loans they would be sued by people like Obama working for groups like ACORN!

NEXT...

 

Google "Deregulation of Commercial Mortgage Backed Securities"

Let's see. No need to qualify for fed insurance when you can use credit swaps! Bundle 10,000 sub-prime mortgages together folks! Rated Triple A by Moody's! Because we wouldn't want one of those nasty federal agencies interefering with the private sector.
So even though CitiBank was found guilty of defrauding investors (not the 1%, they were advised to sell short like Citi did, while concurrently selling long to your mom and dad), it's not like deregulation is EVER a bad thing!
Well, except in the case of the CMBS market that was one of the biggest contributors to this recession.
Or the deregulation of the junk bond and Thrift & Loans that contributed to the previous recession.
Or the deregulation of those new stock thingies in the 20's. That led to something bad too...

 

Yea, that was done AFTER the banks were in possession of all that BAD mortgage paper unconstitutional Democrat wealth distribution and social engineering schemes FORCED them to issue. Once again NONE of those "casino investments" would have gone bad had people continued to pay their overpriced and inflated mortgages. Mortgages overpriced and inflated DUE to Democrat liquidity in the market trying to give away affordable mortgages to high risk low income borrowers who tend to vote Democrat!

Answer me this, if banks were so irresponsible and greedy, why did Democrat Clinton change the CRA enforcement? Seems to me banks were acting plenty responsible BEFORE Democrats FORCED them to act otherwise… Without the deregulation all the financial institutions would have just went bankrupt instead of spreading the Democrat FORCED misery throughout the world!

 

Okay right, I get it. All things Dem = Bad. All things Repub = Pure and good in every way. NM. Waste of time. Fine. Deregulating the CMBS market had no effect at all. Got it.

 

That is exactly right. We are talking about what facilitated the crash. The Commercial Mortgage Backed Securities market AGAIN, depended on the underlining mortgage. Had those mortgages been paid, and not defaulted on those investments would have done just fine.

Look at it this way. If there were not so much money in the mortgage "industry" or sector, the greedy banks and evil rich investors (looking to flip properties for profit in a free and capitalist country ) would not have gotten involved. Where did all that money initially come from if it not from unconstitutional Democrat wealth distribution and social engineering schemes that sought to give away affordable mortgages to those who vote Democrat? Real-estate was appreciating like 20 % a year because of all the market manipulations and the lowering of loans standards. It was all due not free market conditions, but due to an unconstitutional Democrat housing policy. Who wouldn’t have tried to make GUARANTEED money in a Democrat wealth distribution scheme?

 

I know. A nation built on profit seeking and Democrats act all surprised and angry when people actually try and make a profit!!

 

According to liberals, Pres Bush caused the destruction of the US economy simply by breathing

 

I thought it was more about the way he "magically" turned massive surpluses into massive deficits, without the use of hard working elves.

 

Fabricating again, are we?

Feel free to show the post by the liberal that said that.

 

There was an explosion in risky subprime lending and securitization, an unsustainable rise in housing prices, widespread reports of egregious and predatory lending practices, dramatic increases in household mortgage debt, and exponential growth in financial firms’ trading activities, unregulated derivatives, and short-term “repo” lending markets, among many other red
flags. Yet there was pervasive permissiveness; little meaningful action was taken to quell the threats in a timely manner.

The prime example is the Federal Reserve’s pivotal failure to stem the flow of toxic mortgages, which it could have done by setting prudent mortgage-lending standards. The Federal Reserve was the one entity empowered to do so and it did not.

This is a (*)(*)(*)(*)ing indictment of the Fed, and interestingly, not because of its money policy (as the Austrian school folks regularly claim) but in its regulatory power over banks.

I was not aware that the Fed had such power, and exclusive authority, over bank lending practices.

We conclude widespread failures in financial regulation and supervision
proved devastating to the stability of the nation’s financial markets. The sentries were not at their posts, in no small part due to the widely accepted faith in the selfcorrecting nature of the markets and the ability of financial institutions to effectively police themselves. More than 30 years of deregulation and reliance on self-regulation by financial institutions, championed by former Federal Reserve chairman Alan Greenspan and others, supported by successive administrations and Congresses, and actively pushed by the powerful financial industry at every turn, had stripped away
key safeguards, which could have helped avoid catastrophe. This approach had opened up gaps in oversight of critical areas with trillions of dollars at risk, such as the shadow banking system and over-the-counter derivatives markets. In addition, the government permitted financial firms to pick their preferred regulators in what became a race to the weakest supervisor.

Yet we do not accept the view that regulators lacked the power to protect the financial system. They had ample power in many arenas and they chose not to use it. To give just three examples: the Securities and Exchange Commission could have required more capital and halted risky practices at the big investment banks. It did not. The Federal Reserve Bank of New York and other regulators could have clamped down on Citigroup’s excesses in the run-up to the crisis. They did not. Policy makers and regulators could have stopped the runaway mortgage securitization train. They did not. In case after case after case, regulators continued to rate the institutions they oversaw as safe and sound even in the face of mounting troubles, often downgrading them just before their collapse. And where regulators lacked authority, they could have sought it. Too often, they lacked the political will—in a political and ideological environment that constrained it—as well as the fortitude to critically challenge the institutions and the entire system they were entrusted to oversee.


A (*)(*)(*)(*)ing indictment of the conservative philosophy of the past 30 years that industry can regulate itself.

Changes in the regulatory system occurred in many instances as financial markets evolved. But as the report will show, the financial industry itself played a key role in weakening regulatory constraints on institutions, markets, and products. It did not surprise the Commission that an industry of such wealth and power would exert pressure on policy makers and regulators. From 1999 to 2008 , the financial sector expended $2.7 billion in reported federal lobbying expenses; individuals and political action committees in the sector made more than $1 billion in campaign contributions. What troubled us was the extent to which the nation was deprived of the necessary strength and independence of the oversight necessary to safeguard financial stability.

And a (*)(*)(*)(*)ing indictment of a system that allows a system of corporate bribery which contributed to the regulatory failure.

The report also catalogs very private sector failures that contributed to the housing bubble and collapse as well.

Very interesting report. Everyone should read it.

 

Please show proof that banks were forced to make subprime loans that they did not want to make. Thanks!

 

YEAH!! How did Bush cause the recession. Heck, look at all he did as he saw the wheels coming off the tracks!!

Posted August 10, 2007 6:59 AM
With the stock market on a roller coaster, mortgages foreclosing, the housing market off and new questions being raised about the nation's infrastructure, President Bush is striving to assure Americans that the economy is "strong.''

9/20/2007 12:10:18 PM ET
WASHINGTON — President Bush on Thursday cited "some unsettling times" in the U.S. housing and credit markets as he sought to assure jittery Americans that the economy is holding up well despite worries about a recession.

"I say that the fundamentals of our nation's economy are strong," Bush told a White House news conference.

By Kristin Bateman - July 27, 2008, 4:19PM
Last week, the Bush Administration announced that the "fundamentals" of our nation's economy are "very strong," revealing yet again a lack of appreciation for the struggles middle class families are now facing.

 

Banks were FORCED to make CRA loans. Banks were also ENTICED to make subprime loans since Freddie and Fannie actively sought to buy such loans for political purposes enacting unconstitutional Democrat housing policy.

The plain truth is Democrat Masterminds simply ran out of qualified credit worthy low income borrowers who tend to vote Democrat, so standards were lowered, i.e. the very definition of "Sub Prime."

Again from post 77

post 77

http://www.politicalforum.com/polit...id-bush-cause-recession-8.html#post1060859214

2000 - Paragraphs 12 and 13 in part (bold for emphasis)

“In 2000, Cuomo (Democrat Clinton HUD Secretary) required a quantum leap in the number of affordable, low-to-moderate-income loans that the two mortgage banks—known collectively as Government Sponsored Enterprises—would have to buy… The government (Democrats) chartered these banks to pump money into the mortgage market and, while they did it, to make a strong enough profit to attract shareholders. That created a tug-of- war between their efforts to maximize shareholder value, which drove them toward high-end mortgages, and their (Democrat) congressionally mandated obligation to finance loans for those who needed help. The 1992 law required HUD's secretary to make sure housing goals were being met and, ever four years, set new goals for Fannie and Freddie.

Cuomo's predecessor, Henry Cisneros, did that for the first time in December 1995, taking a cautious approach and moving the GSEs toward a requirement that 42 percent of their mortgages serve low- and moderate-income families.
Cuomo raised that number to 50 percent and dramatically hiked GSE mandates to buy mortgages in underserved neighborhoods and for the "very-low-income." Part of the pitch was racial, with Cuomo contending that Fannie and Freddie weren't granting mortgages to minorities at the same rate as the private market. William Apgar, Cuomo's top aide, told The Washington Post: "We believe that there are a lot of loans to black Americans that could be safely purchased by Fannie Mae and Freddie Mac if these companies were more flexible." (meaning if they lowered standards to make those who could not qualify, suddenly qualify for an “affordable mortgage”)

http://newsgroups.derkeiler.com/Arch.../msg00944.html​

I keep posting this stuff, and then people keep arguing against facts AS IF the facts were not right in front of them. Do I have to post the definition of “delusion?”

Banks were FORCED to make their CRA numbers. When they ran out or “credit worthy poor” they had to lower those standards to make their numbers and pass CRA audits, and so they could make their largest customers happy; unconstitutionally Democrat created Freddie and Fannie. Leftists like to lie to the American public and state how capitalism does not work, but never want to admit how their meddling destroys the very thing they say does not work. Of course capitalism will not work when strangled by the Communist Left.

If you want details on how banks had to lower standards to comply with the new enforcement of the CRA under Democrat Clinton just ask.

 

Banks weren't FORCED to make CRA loans. There was no special loan banks had to make under the CRA. The CRA was meant to prevent discrimination by banks based off where someone lived rather than their credit conditions.

F&F weren't even allowed to take in ARM Loans, NINA Loans, and some of the crazier loans the private lenders were making during the subprime crisis. It wasn't until 2005 that F&F forced policy changes so that they can compete with private lenders.

To completely ignore the massive amount of private mortgage lending that went on between 2002-2005 is just you admitting that you don't like the Govt and regardless of what the truth is you are going to blame the Govt.

What an ignorant way to live life!

 

Spoken just like a true Communist! The three things that determine the value of real-estate are LOCATION, LOCATION, and LOCATION. Did you know that, or just did not care when you wrote the following.

Oh, no... As a Communist you reject the free market and want banks to loan money in neighborhoods where the property regularly DECREASES in value! The banks were not making such loans because to do so would be insane. Ah, but the Democrats have a better way!

Ah, just to put things into perspective "redlining" is not even illegal at all. No lawsuit ever cited "redlining" as a cause of action. Redlining just offends Democrats. Well Democrats FORCING banks to make risky loans in compliance with an unconstitutional Democrat housing policy (which was the catalyst of the economic collapse) offends most others!

Again I will state the fact that at one point Freddie and Fannie owned nearly HALF of ALL MORTGAGES in the entire country! They were the (combined) largest player in the game. to make the argument that Freddie and Fannie did not warp the free market for political gains is an outright lie!

The "government' is defined by the Constitution. Nowhere does the Constitution grant the power to the government for Democrat wealth distribution and social engineering schemes. It's not that I dislike government, just Traitors and Tyrants!

NONE of what Democrats call "achievements" would have been allowed had Democrat FDR not threatened the Supreme Court in 1937 so they would stop ruling his "New Deal" unconstitutional. Google the "Switch in Time that Saved Nine."

 

Oh my... Just look where the price bubble was during 2002 I guess BEFORE the “massive amount of private mortgage lending."

 

Thanks for proving my point!! LOL!

2002-2005 was the massive lending by private mortgage lenders who sold them off to Wall Street that caused the collapse. The CRA and F&F were doing just fine for decades except an F&F accounting scandal which prevented them from joining the homeless mortgage lending party between 2002-2005.

Thanks again!

 

I am stupefied at the high level of ignorance (not referring to the OP) in this thread.

 

Look, as I have posted, and reposted, Freddie and Fannie sought to greatly increase their inventory of low to moderate level mortgages between 2000-2004 under the Affordable Housing Goals directive (under the Democrat Clinton administration). The four year goal was in effect for the entire first term of Bush. Look at how much the bubble inflated during the years 2000-2004.

How did lenders selling anything "off to Wall Street... cause... the collapse?" Again, if the underlining investment (people paying their mortgages) did not collapse none of those "casino investments" would have collapsed. I keep showing how unconstitutional Democrat wealth distribution and social engineering schemes created the bubble. Eventually the bubble busted, and people could no longer pay the inflated prices. I guess some just don't understand...

 

LOL!!! You guys are amazingly uneducated!!

 

What does you pretty picture show? Do you know? The "casino investments" were worthless again BECAUSE the bubble in mortgage prices popped, and people could not afford their overpriced home. I believe is you who are "amazingly uneducated!!" Since you seem to think just selling an investment will cause a crash. ROTFLMAO!!!!

 

It wasn't necessarily Bush's fault but it was the fault of government.

Carter passed the Community Reinvestment act in 1977.
Clinton turned this act into a powerful piece of legislation...

The Clinton administration changed this state of affairs dramatically. Ignoring the sweeping transformation of the banking industry since the CRA was passed, the Clinton Treasury Department's 1995 regulations made getting a satisfactory CRA rating much harder. The new regulations de-emphasized subjective assessment measures in favor of strictly numerical ones. Bank examiners would use federal home-loan data, broken down by neighborhood, income group, and race, to rate banks on performance. There would be no more A's for effort. Only results—specific loans, specific levels of service—would count. Where and to whom have home loans been made? Have banks invested in all neighborhoods within their assessment area? Do they operate branches in those neighborhoods?

Crucially, the new CRA regulations also instructed bank examiners to take into account how well banks responded to complaints. The old CRA evaluation process had allowed advocacy groups a chance to express their views on individual banks, and publicly available data on the lending patterns of individual banks allowed activist groups to target institutions considered vulnerable to protest. But for advocacy groups that were in the complaint business, the Clinton administration regulations offered a formal invitation. The National Community Reinvestment Coalition—a foundation-funded umbrella group for community activist groups that profit from the CRA—issued a clarion call to its members in a leaflet entitled "The New CRA Regulations: How Community Groups Can Get Involved." "Timely comments," the NCRC observed with a certain understatement, "can have a strong influence on a bank's CRA rating."

http://www.city-journal.org/html/10_1_the_trillion_dollar.html