http://www.gregpalast.com/elliot-spitzer-gets-nailed/

Maybe it is no accident that Elliot Spitzer was brought down at this time. He was actively investigating predatory lending practices just as the Fed Reserve is devising bailouts for the banks and the Bush Administration is resisting increased regulation of these banks.



.....But there was this annoying party-pooper. The Attorney General of New York, Eliot Spitzer, who sued these guys to a fare-thee-well. Or tried to.

Instead of regulating the banks that had run amok, Bush’s regulators went on the warpath against Spitzer and states attempting to stop predatory practices. Making an unprecedented use of the legal power of “federal pre-emption,” Bush-bots ordered the states to NOT enforce their consumer protection laws.

Indeed, the feds actually filed a lawsuit to block Spitzer’s investigation of ugly racial mortgage steering. Bush’s banking buddies were especially steamed that Spitzer hammered bank practices across the nation using New York State laws.

Spitzer not only took on Countrywide, he took on their predatory enablers in the investment banking community. Behind Countrywide was the Mother Shark, its funder and now owner, Bank of America. Others joined the sharkfest: Goldman Sachs, Merrill Lynch and Citigroup’s Citibank made mortgage usury their major profit centers. They did this through a bit of financial legerdemain called “securitization.”....

Now, I would love to consider this all true, but it flies in the face of yet another liberal belief: karma. I believe that if he had not gone around trying to take down so many corporations that he would not be having as hard a time now.

Sorry but this deserves one huge Greg Palast? A known liar.

Palast either is completely clueless or is trying to hoodwink those who are.

This is a lie. Subprime mortgage lending began in the 80's. It's use increased over time, however even at its peak it was less than 1/4 of all mortgages. So it was never the norm nor did it begin under Bush.

This is called an ARM, has been in existance for years, and its terms are clearly spelled out in loan docs. Palast lays another egg.

Steering...also known as sales. Gasp, some people actually pay more for cars then they have to. Same for those houses that they are financing. And a host of other products.

Behind Countrywide was the Mother Shark, its funder and now owner, Bank of America. Others joined the sharkfest: Goldman Sachs, Merrill Lynch and Citigroup’s Citibank made mortgage usury their major profit centers. They did this through a bit of financial legerdemain called “securitization.”

He calls rates usury (a lie) and said securitization is how it happened. Then he explains how securitization works (failing to mention that securitizations began in the 90's when, last I checked, Clinton was President) and fails to explain how securitizations made mortgage rates usury level.

The idea that Bush got Spitzer because of this is ridiculous since he didn't force Spitzer to hire a prostitute on the day of the report. Thus lies the danger in believing anything Palast farts out of his pie hole.

__________________
All you need to know about the energy crisis:
ANWR Exploration Republicans: 91% Supported. Democrats: 86% Opposed.
Coal-to-liquid R's: 90% YES. D's: 78% NO.
Oil Shale Exploration R's: 90% YES. D's: 86% NO.
Outer Continental Shelf Exploration R's: 81% YES. D's: 83% NO.
Increased Refinery Capacity R's: 97% YES. D's: 96% NO

SUMMARY: 91% of House Republicans have historically voted to increase the production of America’s own oil and gas. 86% of House Democrats have historically voted against.

He does not say it began under Bush. Certainly, it has increased in the past 8 years but he also blames the Clinton Administration for scrapping the remains of Glass-Steagall. [In interviews if not in the article I posted]
I think it is pretty clear that many people were misled. I have heard dozens of interviews with newbie homeowners who did not really understand the terms. Loan originators are not bankers and many had no incentive at all to be frank and clear about the terms of the loan.

You have not heard about people who should have qualified for a low fixed rate but were instead steered to a subprime bad deal??
Well, Like so many men, Spitzer allowed the little head to cloud his judgement but considering his couple of years of indiscretions, the timing is "interesting". Palast makes no claims to have proof of his theory.

You do not seem to address the main point of the thread, which is that the Bush administration aggressively opposed regulation and the Spitzer attempt to reign in predatory lending. In that regard, I have read similar claims from economists such as this from Paul Krugman:


" the Office of the Comptroller of the Currency.

Actually, there was plenty of coordination — a coordinated effort to destroy effective regulation:

Consider the press conference held on June 3, 2003 — just about the time subprime lending was starting to go wild — to announce a new initiative aimed at reducing the regulatory burden on banks. Representatives of four of the five government agencies responsible for financial supervision used tree shears to attack a stack of paper representing bank regulations. The fifth representative, James Gilleran of the Office of Thrift Supervision, wielded a chainsaw.

The lack of oversight, in short, was no oversight: it was part of the plan.

Add: Robert Waldmann has a picture of the scene, chainsaw and all:
INSERT DESCRIPTIONA bunch of real cutups"

Nicely done Zoe. Rebellion, you can't back up what you say about Palast, I doubt you can find one lie, certainly not enough to characterise him as a liar. You're welcome to try- one previous example, in a different thread. Hell I might be wrong, but I've seen nothing but the goods from him so far.

Raharu, Spitzer went after corporations that commited crimes. You subscribe to Karma?

there is no question that ignorant consumers were abused in the mortgage lending process
there is absolutely no doubt the dicknbush regime did everything possible, including the execution of an executive order, to prevent the states from policing the mortgage industry to mitigate the abuses
BUT ... and this is the most fundamental argument ... there has been NO evidence that any mortgagor was coerced against their will to sign any mortgage contract. every borrower entered into - often stupid - contracts of their on free will. yes, that will may have been very stupid. that borrower may have been undersophisticated to enter into that contract; but legally, if they were of sound mind and had reached the age of emancipation, they are ENTITLED to sign the contract.
every person has the right to have an attorney assist them in their financial affairs. had they done so, most of these folks would not UNKNOWINGLY be losing their asses in loans gone bad. competent counsel would have explained the risk and the liability to the client to allow them to back out of a bad mortgage before signing. but to save a couple of hundred dollars the borrowers moved forward without a lawyer to represent their interests and entered into the contract on their own. why should the taxpayer now be expected to bail any of them out of a bad deal they legally volunteered to enter?

certainly there were unethical mortgage lenders who knowingly took advantage of innocents in order to profit at their expense
obviously the shrub was motivated by high powered lenders - who contribute massive amounts to republican politicians - to do an end run around the states, which were trying to thwart abusive lending practices
but let's lay the blame for the loan defaults at the feet of those most responsible for it: the borrowers who willingly signed financial obligations they did not know they would be able to repay

__________________
“Mayor Palin fails to have a firm grasp of something very simple: the truth.”

[Frontiersman editorial, 2/7/97]

to protect the citizens?? HAHAHAHAHAHAH

Every article stands on its own merit. Saying it another time doesn't help this article. He said it became the norm under Bush that is a lie.

Caveat emptor...if you're spending hundreds of thousands of dollars on a house and a mortgage it is your responsibility to understand it. No one is going to understand it for you. Every mortgage includes a mortgage note which clearly lays out the terms. 360 payments at $x or 60 payments at $x if a 5yr arm with the new rate and spread clearly indicated. If I can understand that as an 18 year old, adults should be expected to as well.

You haven't heard of someone who could have bought a car for $30K, but instead paid $32K for it? Or someone who could have bought a house for $300K, but instead paid $325K? It's not the government's job to negotiate terms on your behalf. You are responsible for your own actions and knowledge.

What a great journalist, theories with absolutely no proof. If Fox said in their newscast that they believe Obama slept with goats, but provided no proof how would that go over? The timing is coincidental unless there is some evidence that Bush tempted Spitzer with a prostitute since he is the one who initiated the encounter, not Bush or anyone else.

Caveat emptor...I don't need the government to tell me if I'm getting a good deal buying a car or buying anything else for that matter. Of course Palast made claims without any proof. What else is new of Palast.

__________________
All you need to know about the energy crisis:
ANWR Exploration Republicans: 91% Supported. Democrats: 86% Opposed.
Coal-to-liquid R's: 90% YES. D's: 78% NO.
Oil Shale Exploration R's: 90% YES. D's: 86% NO.
Outer Continental Shelf Exploration R's: 81% YES. D's: 83% NO.
Increased Refinery Capacity R's: 97% YES. D's: 96% NO

SUMMARY: 91% of House Republicans have historically voted to increase the production of America’s own oil and gas. 86% of House Democrats have historically voted against.

I proved it above, it was not the norm. That is a lie. Additionally, he lied about quotes allegedly attributed to Cynthia McKinney by Bush.

http://curezone.com/forums/fm.asp?i=550443

__________________
All you need to know about the energy crisis:
ANWR Exploration Republicans: 91% Supported. Democrats: 86% Opposed.
Coal-to-liquid R's: 90% YES. D's: 78% NO.
Oil Shale Exploration R's: 90% YES. D's: 86% NO.
Outer Continental Shelf Exploration R's: 81% YES. D's: 83% NO.
Increased Refinery Capacity R's: 97% YES. D's: 96% NO

SUMMARY: 91% of House Republicans have historically voted to increase the production of America’s own oil and gas. 86% of House Democrats have historically voted against.

Remind me not to go to you for any banking needs! Caveat Emptor shlemptor; sometimes its fraud, plain and simple. I have bought lots of homes and the deal was that the guy loaning me money had as much at stake in the deal as I had. The banker had more incentive to make sure that I was a reasonable risk with his money than I had. " Caveat Emptor", indeed . Rubbish. The guy or girl who is walking away from their home will lose little or nothing but their credit rating. And the scum bag loan originator won't lose anything for his deceptive practice. And the CEO of Countrywide won't lose anything. Who loses? -The U.S. economy, investors, the tax payer who has to bail out these glorified gambling establishments. All this with the assistance of the Fed and regulators whose mission it was to reduce regulation. Lovely.

Sure, it may be a conspiracy theory. Blogs don't have to maintain the same standards as newscasters. It is not presented as fact. It is presented as a coincidence that "smells". Given the Administration's pattern of firing or punishing anyone who crosses them, it strikes me a as very plausible.