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That is the section about orderly liquidation. I assume then, you would prefer a disorderly process. Okay.
An orderly liquidation process is already in place, its called the bankruptcy courts.. But since you want to be humorous, you can answer this.
orderly liquidation by WHO? THE GOVERNMENT.. In order for the government to liquidate a financial institution, they have to TAKE IT OVER FIRST!! Sorry, I'm not for the federal government taking over financial institutions, I'd prefer to let them fail and let the investors pay the price. If you dont mind the taxpayers taking over financial institutions that fail, then stop whining..
How so is the financial collapse solely the fault of the government?
You can blame them for most everything. It's not hard to do that. But the events that brought on the financial collapse were related to a number of different things, some of which the government was involved in and could have handled better, and some of which the government was not involved.
I've got issues with this bill. I agree with Scott Brown that the regulation of derivatives doesn't go far enough. I agree with other Republicans about granting bank status to financial entities that are not banks, along with the privileges that bank status confers. These are problems.
But I think Republicans are challenging bills strictly for partisan reasons, not based on the content of the bills, and that is not a good thing.
first off...please dont lie I never said the government was SOLELY the cause....
Fannie Mae Seeks to Ease Home Buying
By KEITH BRADSHER,
Published: March 10, 1994
WASHINGTON, March 9— The organization that stands behind many of the nation's mortgages is taking broad steps to make home ownership easier for lower-income Americans, particularly recent immigrants and minorities, people involved in the effort said today.
Under the new rules, banks would have more flexibility in lending to people who already owe a considerable amount of money or who cannot afford a down payment equal to 20 percent of the price of a home, the people said. Tuesday Announcement.
President Clinton is tentatively scheduled to attend the announcement. The Administration is urging that loans be more broadly available to poor and lower-middle-income Americans.
Fannie Mae Seeks to Ease Home Buying - NYTimes.com (http://www.nytimes.com/1994/03/10/business/fannie-mae-seeks-to-ease-home-buying.html?scp=695&sq=fannie+mae&st=nyt - broken link)
--------------------------------------
calls its ''no-doc product'' -- as in no documents needed.
According to Jay Siegel, a vice president at Moody's Investor Service: ''Subprime loans have exploded from $7 billion in 1992 to $37 billion in 1996 as a sector of the entire securitized conventional loan market.'' That $37 billion, Mr. Siegel said, represents 11 percent of all the conventional loans that were securitized in 1996, up from 1.4 percent in 1992.
According to Jay Siegel, a vice president at Moody's Investor Service: ''Subprime loans have exploded from $7 billion in 1992 to $37 billion in 1996 as a sector of the entire securitized conventional loan market.'' That $37 billion, Mr. Siegel said, represents 11 percent of all the conventional loans that were securitized in 1996, up from 1.4 percent in 1992.
The agencies have also, for the first time, become guarantors of subprime loans. In fact, on May 21, Freddie Mac agreed to guarantee the securitization of $227.3 million in subprime loans originated by the First Union Home Equity Bank.
Several industry analysts point out that the trend toward subprime lending has been a boon to the nation's affordable housing movement. ''There are more subprime opportunities that dovetail well with C.R.A.-required lending,'' said Mr. Gumbinger.
C.R.A. is the Community Reinvestment Act, a law passed by Congress in 1977 to combat red-lining -- the systematic policy of banks to avoid making loans in poor communities. The law requires Federally regulated banks and savings and loans, but not mortgage banks, to ''help meet the credit needs of communities in which they are chartered.'' If one of those lenders applies to Federal regulatory agencies for a merger or a new charter, it must demonstrate that it has originated a sufficient number of loans in low- and moderate-income neighborhoods.
----------------------------
Homeowners Record Is Set in Third Quarter
By STEVEN A. HOLMES
Published: November 1, 1997
Independent analysts, as well as those in the Clinton Administration, say that the rising number of homeowners -- including many, like Ms. Crittendon, who are first-time buyers -- is the result of several factors. These include low interest rates, low unemployment, rising incomes, a number of Federal assistance programs, increased competition among mortgage lenders, and better enforcement of fair-housing laws.
''It's not just that it's a strong economy,'' said Andrew M. Cuomo, Secretary of Housing and Urban Development. ''It's that people are willing to believe that they'll have a job long term, that their house will appreciate and that their incomes will grow.''
These increases stem in part from rising incomes and lowered unemployment among minorities and single women. The rise is also the result of several policies adopted by the Bush and Clinton Administrations. Starting in 1991, for example, Federal regulators, when asked to approve bank mergers, began to include a bank's lending history in low- and moderate-income areas as part of their review.
In 1993, Congress ordered the two Federally chartered lending companies, Fannie Mae and Freddie Mac, to increase their loans to low- and moderate-income borrowers. In 1995, seeking to save his department from elimination by the newly elected Republican-led Congress, Housing Secretary Henry G. Cisneros adopted a ''national homeownership strategy'' that eased requirements to qualify for Federal Housing Administration-insured loans and reduced closing costs by as much as $1,200 on those loans for first-time buyers.
Homeowners Record Is Set in Third Quarter - NYTimes.com (http://www.nytimes.com/1997/11/01/us/homeowners-record-is-set-in-third-quarter.html?scp=66&sq=1995+fannie&st=nyt - broken link)
-------------------------
Fannie Mae Eases Credit To Aid Mortgage Lending
By STEVEN A. HOLMES
Published: September 30, 1999
WASHINGTON, Sept. 29— In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.
Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.
In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.
''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''
Fannie Mae, the nation's biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.
Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites. Fannie Mae Eases Credit To Aid Mortgage Lending - NYTimes.com
--------------------------
U.S. Proposes Rules to Help House Buyers
Published: March 5, 2000
WASHINGTON, March 3— The federal government has proposed new rules that would make it easier for low-income house buyers to qualify for mortgage loans, a move intended to help blacks and other minorities buy houses.
The proposed rules from the Department of Housing and Urban Development would require two of the largest housing finance companies in the country, Fannie Mae and Freddie Mac, to increase the percentages of overall loans that they offer to lower-income families from the current standard of 42 percent to 48 percent in 2000 and to 50 percent in 2001.
The companies would be required over the next 10 years to buy $2.4 trillion in mortgages from banks and other lenders to assist the 28 million American families with low and moderate incomes. Many of those families are minorities, housing officials said.
Fannie Mae and Freddie Mac fall under federal oversight because they receive special exemptions from Congress from all state and local taxes except property taxes and from Securities and Exchange Commission registration requirements.
The requirements for mortgage purchases were last set in 1995. The goals were up for renewal this year, as required by Congress. The housing administration could have lowered the goals or have left them unchanged. After a 60-day public comment period, a final rule is expected in the fall.
U.S. Proposes Rules to Help House Buyers - NYTimes.com (http://www.nytimes.com/2000/03/05/us/us-proposes-rules-to-help-house-buyers.html?scp=1101&sq=fannie+mae&st=nyt - broken link)
''This rule will greatly expand the supply of affordable housing across the country,'' said Housing Secretary Andrew M. Cuomo.
The companies buy mortgages for homes and apartment buildings from banks, savings and loans and other mortgage lenders, and package and sell the loans to investors. When Freddie Mac and Fannie Mae buy mortgages from lenders, they provide the lenders with cash to issue new mortgages.
--------------------------
President Clinton, with the blessing of Democrats in Congress, advanced an agenda which they called, The National Homeownership Strategy: Partners in the American Dream. (Do a Web search.) In short, it encouraged mortgage lenders to loosen-up their requirements for those seeking mortgages, thus making home ownership available to those who otherwise wouldn't qualify - in other words, for those who couldn't afford it.
The government, as a result, relaxed requirements for the federal guarantee on those mortgages: lowered income to payment ratio, relaxed income verification, reduced (or eliminated) down payments, etc. Mortgage lenders, as ones who issued those government backed loans, were encouraged - or possibly directed - to follow suit. (I say directed to follow suit because those lenders had to follow government rules if they wanted to continue to be able to issue FHA loans.)
The National Homeownership Strategy: Partners in the American Dream, is a "..... public-private partnership working to dramatically increase homeownership opportunity in America. Under the directive of President Clinton, the Partnership was formed in 1995 by nearly 60 national organizations that care about homeownership. Today, the Partnership consists of 66 members representing lenders, real estate professionals, home builders, nonprofit housing providers, and federal, state and local governments.
HUD Secretary Andrew Cuomo said: "The good news as we mark National Homeownership Week is that homeownership in America is at record levels. But the bad news we face is that many of HUD's homeownership and other programs are under attack by some members of Congress. The success of our homeownership initiatives proves that HUD in combination with local organizations can further our goal of even more homeownership and fulfill our commitment to liberty and equity for all."
not sure as to the "gop" but conservatives, understand that 'reform' will just get us more of the same....its government that caused the problem to begin with
Okay, you didn't say "solely". You said "its government that caused the problem to begin with." Did you say, "partly caused,"? Did you mention any other players? That's why I challenged you. Your statement didn't ascribe any responsibility for the "problem" to anyone besides the government.
first off...please dont lie I never said the government was SOLELY the cause....
Fannie Mae Seeks to Ease Home Buying
By KEITH BRADSHER,
Published: March 10, 1994
WASHINGTON, March 9— The organization that stands behind many of the nation's mortgages is taking broad steps to make home ownership easier for lower-income Americans, particularly recent immigrants and minorities, people involved in the effort said today.
Under the new rules, banks would have more flexibility in lending to people who already owe a considerable amount of money or who cannot afford a down payment equal to 20 percent of the price of a home, the people said. Tuesday Announcement.
President Clinton is tentatively scheduled to attend the announcement. The Administration is urging that loans be more broadly available to poor and lower-middle-income Americans.
Fannie Mae Seeks to Ease Home Buying - NYTimes.com (http://www.nytimes.com/1994/03/10/business/fannie-mae-seeks-to-ease-home-buying.html?scp=695&sq=fannie+mae&st=nyt - broken link)
--------------------------------------
calls its ''no-doc product'' -- as in no documents needed.
According to Jay Siegel, a vice president at Moody's Investor Service: ''Subprime loans have exploded from $7 billion in 1992 to $37 billion in 1996 as a sector of the entire securitized conventional loan market.'' That $37 billion, Mr. Siegel said, represents 11 percent of all the conventional loans that were securitized in 1996, up from 1.4 percent in 1992.
According to Jay Siegel, a vice president at Moody's Investor Service: ''Subprime loans have exploded from $7 billion in 1992 to $37 billion in 1996 as a sector of the entire securitized conventional loan market.'' That $37 billion, Mr. Siegel said, represents 11 percent of all the conventional loans that were securitized in 1996, up from 1.4 percent in 1992.
The agencies have also, for the first time, become guarantors of subprime loans. In fact, on May 21, Freddie Mac agreed to guarantee the securitization of $227.3 million in subprime loans originated by the First Union Home Equity Bank.
Several industry analysts point out that the trend toward subprime lending has been a boon to the nation's affordable housing movement. ''There are more subprime opportunities that dovetail well with C.R.A.-required lending,'' said Mr. Gumbinger.
C.R.A. is the Community Reinvestment Act, a law passed by Congress in 1977 to combat red-lining -- the systematic policy of banks to avoid making loans in poor communities. The law requires Federally regulated banks and savings and loans, but not mortgage banks, to ''help meet the credit needs of communities in which they are chartered.'' If one of those lenders applies to Federal regulatory agencies for a merger or a new charter, it must demonstrate that it has originated a sufficient number of loans in low- and moderate-income neighborhoods.
----------------------------
Homeowners Record Is Set in Third Quarter
By STEVEN A. HOLMES
Published: November 1, 1997
Independent analysts, as well as those in the Clinton Administration, say that the rising number of homeowners -- including many, like Ms. Crittendon, who are first-time buyers -- is the result of several factors. These include low interest rates, low unemployment, rising incomes, a number of Federal assistance programs, increased competition among mortgage lenders, and better enforcement of fair-housing laws.
''It's not just that it's a strong economy,'' said Andrew M. Cuomo, Secretary of Housing and Urban Development. ''It's that people are willing to believe that they'll have a job long term, that their house will appreciate and that their incomes will grow.''
These increases stem in part from rising incomes and lowered unemployment among minorities and single women. The rise is also the result of several policies adopted by the Bush and Clinton Administrations. Starting in 1991, for example, Federal regulators, when asked to approve bank mergers, began to include a bank's lending history in low- and moderate-income areas as part of their review.
In 1993, Congress ordered the two Federally chartered lending companies, Fannie Mae and Freddie Mac, to increase their loans to low- and moderate-income borrowers. In 1995, seeking to save his department from elimination by the newly elected Republican-led Congress, Housing Secretary Henry G. Cisneros adopted a ''national homeownership strategy'' that eased requirements to qualify for Federal Housing Administration-insured loans and reduced closing costs by as much as $1,200 on those loans for first-time buyers.
Homeowners Record Is Set in Third Quarter - NYTimes.com (http://www.nytimes.com/1997/11/01/us/homeowners-record-is-set-in-third-quarter.html?scp=66&sq=1995+fannie&st=nyt - broken link)
-------------------------
Fannie Mae Eases Credit To Aid Mortgage Lending
By STEVEN A. HOLMES
Published: September 30, 1999
WASHINGTON, Sept. 29— In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.
Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.
In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.
''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''
Fannie Mae, the nation's biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.
Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites. Fannie Mae Eases Credit To Aid Mortgage Lending - NYTimes.com
--------------------------
U.S. Proposes Rules to Help House Buyers
Published: March 5, 2000
WASHINGTON, March 3— The federal government has proposed new rules that would make it easier for low-income house buyers to qualify for mortgage loans, a move intended to help blacks and other minorities buy houses.
The proposed rules from the Department of Housing and Urban Development would require two of the largest housing finance companies in the country, Fannie Mae and Freddie Mac, to increase the percentages of overall loans that they offer to lower-income families from the current standard of 42 percent to 48 percent in 2000 and to 50 percent in 2001.
The companies would be required over the next 10 years to buy $2.4 trillion in mortgages from banks and other lenders to assist the 28 million American families with low and moderate incomes. Many of those families are minorities, housing officials said.
Fannie Mae and Freddie Mac fall under federal oversight because they receive special exemptions from Congress from all state and local taxes except property taxes and from Securities and Exchange Commission registration requirements.
The requirements for mortgage purchases were last set in 1995. The goals were up for renewal this year, as required by Congress. The housing administration could have lowered the goals or have left them unchanged. After a 60-day public comment period, a final rule is expected in the fall.
U.S. Proposes Rules to Help House Buyers - NYTimes.com (http://www.nytimes.com/2000/03/05/us/us-proposes-rules-to-help-house-buyers.html?scp=1101&sq=fannie+mae&st=nyt - broken link)
''This rule will greatly expand the supply of affordable housing across the country,'' said Housing Secretary Andrew M. Cuomo.
The companies buy mortgages for homes and apartment buildings from banks, savings and loans and other mortgage lenders, and package and sell the loans to investors. When Freddie Mac and Fannie Mae buy mortgages from lenders, they provide the lenders with cash to issue new mortgages.
--------------------------
President Clinton, with the blessing of Democrats in Congress, advanced an agenda which they called, The National Homeownership Strategy: Partners in the American Dream. (Do a Web search.) In short, it encouraged mortgage lenders to loosen-up their requirements for those seeking mortgages, thus making home ownership available to those who otherwise wouldn't qualify - in other words, for those who couldn't afford it.
The government, as a result, relaxed requirements for the federal guarantee on those mortgages: lowered income to payment ratio, relaxed income verification, reduced (or eliminated) down payments, etc. Mortgage lenders, as ones who issued those government backed loans, were encouraged - or possibly directed - to follow suit. (I say directed to follow suit because those lenders had to follow government rules if they wanted to continue to be able to issue FHA loans.)
The National Homeownership Strategy: Partners in the American Dream, is a "..... public-private partnership working to dramatically increase homeownership opportunity in America. Under the directive of President Clinton, the Partnership was formed in 1995 by nearly 60 national organizations that care about homeownership. Today, the Partnership consists of 66 members representing lenders, real estate professionals, home builders, nonprofit housing providers, and federal, state and local governments.
HUD Secretary Andrew Cuomo said: "The good news as we mark National Homeownership Week is that homeownership in America is at record levels. But the bad news we face is that many of HUD's homeownership and other programs are under attack by some members of Congress. The success of our homeownership initiatives proves that HUD in combination with local organizations can further our goal of even more homeownership and fulfill our commitment to liberty and equity for all."
Mortgages weren't the ONLY problem. As evidenced by the financial collapse of financial companies that weren't involved in mortgages. Derivatives aren't bundled mortgages. Derivatives are gambles based on predictions of success or failure of other financial instruments. Some derivatives are gambles based on derivatives. Which is why AIG and other financial houses didn't want to let the people go who had originally designed them, because they were so complex and multi-layered, that in order to understand the derivatives the investment houses needed the people who had designed them.
CRA and GSE Act promoted "innovative or flexible" lending practices such as downpayments of 5% or less, acceptance of impaired credit, higher debt ratios and creative definitions of income. This loosened underwriting resulted in total CRA originations and non-overlapping GSE AH acquisitions by the GSEs of $7 trillion over the period 1993-2007. This tsunami of high risk lending spawned and sustained a housing bubble unlike any this country has ever seen.
Why did GSE Act and CRA's mandated lending have such a huge impact? Historically home prices were determined by supply and demand at a local level. These two acts changed this local dynamic. Both operated nationally, due to the fact the Fannie and Freddie, along with the big banks responsible for the overwhelming majority of announced CRA commitments, were all national in scope. They were not only largely independent of local supply and demand pressures; their loosened credit standards created demand.
Freddie and Fannie were underwriting the loans so it was the implicit guarantee that no loan would be rejected that spurred everyone, including the independent mortgage companies, to lend. I'm not sure, but I think the independents made a ton of money on the deal.
This is just socialism and greed and unintended consequences.
There is absolutely no way the current bankruptcy system could handle the collapse of a "too-big-to-fail" multinational investment bank. If such an event took place, the court would almost certainly cry for help, and Congress would have to intervene by creating a special purpose entity of some sort to manage the dissolution.
One solution would be to use antitrust laws to break up those banks into smaller components, and thus erase the idea of "too big to fail" in the first place.
Some economists have pointed out that once firms reach a certain size, it becomes functionally impossible for their CEOs to understand all of the firm's operations, even if these CEOs wish to do so.
That's one of the reasons why AIG's corporate leadership allowed the company's "financial products division" to run wild making absurd bets. When you oversee a firm that large, there is simply no way you can gain any sort of mastery over the thousands of different things your firm is doing.
However, by breaking up large investment banks into $100 billion pieces, a lot of those issues would be addressed.
There is absolutely no way the current bankruptcy system could handle the collapse of a "too-big-to-fail" multinational investment bank. If such an event took place, the court would almost certainly cry for help, and Congress would have to intervene by creating a special purpose entity of some sort to manage the dissolution.
One solution would be to use antitrust laws to break up those banks into smaller components, and thus erase the idea of "too big to fail" in the first place.
Some economists have pointed out that once firms reach a certain size, it becomes functionally impossible for their CEOs to understand all of the firm's operations, even if these CEOs wish to do so.
That's one of the reasons why AIG's corporate leadership allowed the company's "financial products division" to run wild making absurd bets. When you oversee a firm that large, there is simply no way you can gain any sort of mastery over the thousands of different things your firm is doing.
However, by breaking up large investment banks into $100 billion pieces, a lot of those issues would be addressed.
There is absolutely no way the current bankruptcy system could handle the collapse of a "too-big-to-fail" multinational investment bank. If such an event took place, the court would almost certainly cry for help, and Congress would have to intervene by creating a special purpose entity of some sort to manage the dissolution.
One solution would be to use antitrust laws to break up those banks into smaller components, and thus erase the idea of "too big to fail" in the first place.
Some economists have pointed out that once firms reach a certain size, it becomes functionally impossible for their CEOs to understand all of the firm's operations, even if these CEOs wish to do so.
That's one of the reasons why AIG's corporate leadership allowed the company's "financial products division" to run wild making absurd bets. When you oversee a firm that large, there is simply no way you can gain any sort of mastery over the thousands of different things your firm is doing.
However, by breaking up large investment banks into $100 billion pieces, a lot of those issues would be addressed.
Sober? Sane? Rational? Restoration of accountability? Why, you sound like the conservatives I used to know!!!
So 99% of Americans don't have to declare Bastille day fighting a bogus class war??! Regulating capitalism isn't the same as communism after all??? You mean it's irrational to expect that corporations shoulder the burden of good governance for a sovereign nation? Shiver me timbers!
The U.S. Securities and Exchange Commission split 3-2 along party lines to approve an enforcement case against Goldman Sachs Group Inc.
This can't be true! My God
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