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#39828 - 09/17/08 11:50 AM Re: This is why Barack Obama will not be elected. [Re: Daniel]
alicex4 Offline
Carpal Tunnel

Registered: 07/05/00
Posts: 3400
I call you a socialist because you espouse the Clinton years as the end all be all for great taxes, govt, etc. IMO, taxes in the Clinton years were too high, only one of the problems with the administration. Here from MSNBC last night is Robert Reich, In the latter years of the Clinton administration -- when I was not there any longer, I should add -- there was an attempt by Alan Greenspan and Bob Rubin and a few others to deregulate financial markets, and they did. They split commercial banking off from investment banking. And many people say, "Well, that was the beginning of the problem," and then, of course, in 2003-2004, Alan Greenspan reduced short-term interest rates to the point where every single bank wanted to lend money. I mean, if you could stand up straight you could get a bank loan because there was so much pressure to get that money out the door. Money was so cheap. So, yes, there is some responsibility on Democrats, some responsibility on Alan Greenspan and the Fed." So, finally a truthful answer from a former Clinton cabinet member as to how this system all got into place.

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#39829 - 09/17/08 12:06 PM Re: This is why Barack Obama will not be elected. [Re: alicex4]
alicex4 Offline
Carpal Tunnel

Registered: 07/05/00
Posts: 3400
Look up Franklin Delano Raines and see the tentacles reaching back to the Clinton administration. He got his start in the Carter Administration. In 1991 he became Fannie's Mae's Vice Chairman, a post he left in 1996 in order to join the Clinton Administration as the Director of the U.S. Office of Management and Budget, where he served until 1998. In 1999, he returned to Fannie Mae as CEO. On December 21, 2004 Raines accepted what he called "early retirement" from his position as CEO while U.S. Securities and Exchange Commission investigators continued to investigate alleged accounting irregularities. He is accused by The Office of Federal Housing Enterprise Oversight (OFHEO), the regulating body of Fannie Mae, of abetting widespread accounting errors, which included the shifting of losses so senior executives, such as himself, could earn large bonuses In 2006, the OFHEO announced a suit against Raines in order to recover some or all of the $50 million in payments made to Raines based on the overstated earnings initially estimated to be $9 billion but have been announced as 6.3 billion.

Civil charges were filed against Raines and two other former executives by the OFHEO in which the OFHEO sought $110 million in penalties and $115 million in returned bonuses from the three accused. On April 18, 2008, the government announced a settlement with Raines together with J. Timothy Howard, Fannie's former chief financial officer, and Leanne G. Spencer, Fannie's former controller. The three executives agreed to pay fines totaling about $3 million, which will be paid by Fannie's insurance policies. Raines also agreed to donate the proceeds from the sale of $1.8 million of his Fannie stock and to give up stock options. The stock options however have no value. Raines also gave up an estimated $5.3 million of "other benefits" said to be related to his pension and forgone bonuses.

An editorial in The Wall Street Journal called it a "paltry settlement" which allowed Raines and the other two executives to "keep the bulk of their riches." In 2003 alone, Raines's compensation was over $20 million.
In June 2008 Wall Street Journal reported that Franklin Raines was one of several politicians who received below market rates loans at Countrywide Financial because the corporation considered the officeholders "FOA's"--"Friends of Angelo". He received loans for over $3 million while CEO of Fannie Mae.

Follow the money, it has Democrat hands all over it.

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#39831 - 09/17/08 12:39 PM Re: This is why Barack Obama will not be elected. [Re: alicex4]
alicex4 Offline
Carpal Tunnel

Registered: 07/05/00
Posts: 3400
From Investors Business Daily today
Push Is On To Undo New FHA Loan Rules

In the midst of a housing crisis with its roots in easy money, Democratic lawmakers want taxpayers to once again back loans to borrowers putting up no money of their own.

The House Financial Services Committee on Tuesday marked up legislation to let the Federal Housing Administration guarantee mortgages when the seller helps out with the down payment.

Supporters contend the new legislation contains adequate safeguards. But critics say down payment assistance loans are far more likely to default, raising losses for the FHA — read taxpayers.

It comes on the heels of the Treasury's takeover of quasi-private mortgage finance giants Freddie Mac (FRE) and Fannie Mae. (FNM) Taxpayers may end up paying $200 billion for the emergency move.

Down payment assistance lets buyers unable to put sufficient money down to buy a house do so anyway. Seller-funded assistance often entails the seller giving the down payment to the buyer via a nonprofit, which earns a fee.

But buyers who don't put up any of their own money default more often. Further, sellers may inflate the price in such situations, knowing FHA insurance will cover the loan if the buyer defaults. The down payment essentially is added to the price the seller otherwise would accept, critics argue.

Fully 22% of FHA-backed seller-funded assistance mortgages that were three years old were delinquent, according to a 2007 Government Accountability Office study. The compares with 13% of nonseller assistance and 9% of those without assistance.

Since then, home prices have fallen sharply, leading to a big rise in delinquency rates overall.

The FHA is projected to lose $4.6 billion this year. Commissioner Brian Montgomery largely blames that on seller-financed down payments. In 2007, such mortgages accounted for 35% of FHA's loans.

Congress scrapped the program as part of the broad housing rescue bill passed this summer.

Yet Rep. Al Green, D-Texas, already wants to reinstate it.

Rep. Spencer Bauchus, R-Ala., ranking member of the House Financial Services Committee, told the panel that reviving down payment assistance is "unwise."

Housing and Urban Development spokesman Lemar Wooley said, "We have deep reservations about the legislation in its current form."

Green says, "Those concerns have been dealt with."

Under his plan, a buyer with a credit score of 620 to 679 could qualify for a seller-funded down payment mortgage backed by the FHA with a 3% initial premium and a 1.25% annual premium on the original principal. Those with credit scores 680 and over could qualify without paying the additional premiums. The FHA would have the option of developing a seller-funded program for those with credit scores below 620.

Lenders deem credit scores over 700 to be a sign of good financial health, while those under 600 are high risk, according to the Consumer Federation of America.

Those safeguards may be inadequate. "The problem is perverse incentives," said John Berlau, director of the Center for Entrepreneurship at the libertarian Competitive Enterprise Institute. "The sellers and banks have an incentive to cheat since they know the taxpayers will be left holding the bag."

The FHA faces other problems as well. The housing bailout requires the agency to insure up to $300 billion in subprime loans to try and curb foreclosures.

To ease pressures on homeowners, the FHA will back loans only when lenders write down the principal to 90% of the current property value.

"Congress hopes the FHA will save the housing industry, but who's gonna' save the FHA?" asks Alex Pollack, a resident fellow at the conservative American Enterprise Institute and former president of the Federal Home Loan Bank of Chicago. "No one says it, but the FHA is the government's subprime lender."

Berlau noted, "Because of the bailout, banks now have an incentive to dump their loans that are most likely to default on the FHA."

The second-quarter delinquency rate for FHA loans was 12.6% vs. 18.7% for subprime, according to the Mortgage Bankers Association.

The Congressional Budget Office estimated the bailout would cost taxpayers $24 billion over 10 years, but that's just a stab in the dark.

"$50 billion? $100 billion? No one knows," said Guy Cecala, president of Inside Mortgage Finance.

Cecala points to what he believes is an even more immediate risk for the FHA.

"The FHA is accounting for one-quarter of new mortgages this year, at a time when home prices are still declining. Many of those mortgages could be underwater by next year."

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#39832 - 09/17/08 01:05 PM Re: This is why Barack Obama will not be elected. [Re: alicex4]
oenophore Offline
Carpal Tunnel

Registered: 09/24/01
Posts: 5977
Loc: 212 land
Er, and this is why Barack Obama will not be elected?
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#39834 - 09/17/08 01:14 PM Re: This is why Barack Obama will not be elected. [Re: oenophore]
alicex4 Offline
Carpal Tunnel

Registered: 07/05/00
Posts: 3400
If Mr. Obama, in the short time he has been in the Senate, is the number 2 or 3 recipient of donations from Fannie Mae and Freddie Mac, and we know how corrupt that organization was/is with Democratic crooks, no he should not be elected. Follow the money.

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#39835 - 09/17/08 01:42 PM Re: This is why Barack Obama will not be elected. [Re: alicex4]
Daniel Offline
veteran

Registered: 05/23/01
Posts: 1515
 Originally Posted By: alicex4
I call you a socialist because you espouse the Clinton years as the end all be all for great taxes, govt, etc. IMO, taxes in the Clinton years were too high, only one of the problems with the administration.


I don't see any connection between those items and socialism. Just because you think taxes were too high doesn't imply that we were "socialists" in the 1990s.

Labels are not a substitute for analysis. I invite you to say what you'd cut to not only balance the budget but compensate for the lower taxes you advocate. We've talked about the necessity for making hard choices. What would yours be? (And, as I noted, eliminating earmarks and getting rid of the Department of Education won't get the job done.)

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#39836 - 09/17/08 01:43 PM Re: This is why Barack Obama will not be elected. [Re: alicex4]
Daniel Offline
veteran

Registered: 05/23/01
Posts: 1515
 Originally Posted By: alicex4
If Mr. Obama, in the short time he has been in the Senate, is the number 2 or 3 recipient of donations from Fannie Mae and Freddie Mac, and we know how corrupt that organization was/is with Democratic crooks, no he should not be elected. Follow the money.


Oh please. I believe it's well-known that the regulatory failure regarding Fannie/Freddie was a completely bipartisan effort.

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#39837 - 09/17/08 01:46 PM Re: This is why Barack Obama will not be elected. [Re: alicex4]
Smike Offline
Carpal Tunnel

Registered: 05/01/01
Posts: 3143
Loc: in your backyard
It has always been my belief that idea that everyone should own there own home is flawed. The Clinton Administration moved this idea ahead dramatically in ways that started the crisis that the financial markets are in today. There were attempts to pull back on this by the Bush Administration but they failed at controlling this mess as much as the Clinton Administrations failed to see the long effects of shoving everyone into a mortgage. This is a classic case of social programs going into effect for the ‘good and ‘welfare’ of the people but creating long term destabilization in the free markets.

Any legislation that attempts to bolster the trend of mortgage welfare should be met with strong resistance as this will only contribute to the lingering housing crisis. The idea that government needs to create more buyers through legislation by making it easier to get a mortgage so as to fill all these empty homes on the market is a very bad idea and the major factor why we are where we are today.


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#39841 - 09/17/08 02:57 PM Re: This is why Barack Obama will not be elected. [Re: Smike]
yorick Offline
old hand

Registered: 11/15/02
Posts: 1041
Loc: hamlet\'s hand
uhahahahahaha...free markets...uhahahahahhahahahahahahahahahaha: S & L bailouts, Asian bank bailouts, grazing subsidies, farming subsidies, logging subsidies, mining subsidies, oil subsidies, welfare professional sports arenas, investment back bailouts, insurance industry bailouts.

Please, let's start calling it what we have here in the US of A: state subsidized capitalism.
_________________________
Shongum ain\'t Indian,
it\'s Shawank-unk.

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#39842 - 09/17/08 03:05 PM Re: This is why Barack Obama will not be elected. [Re: yorick]
oenophore Offline
Carpal Tunnel

Registered: 09/24/01
Posts: 5977
Loc: 212 land
Please, let's start calling it what we have here in the US of A: state subsidized capitalism.

And only "third party" candidates, if elected, will work to cease and desist.
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