NY Times blames Bush for Mortgage Crisis...

[ponycar17]

Although I don't agree with Bush on every issue, the NY Times shows their true bias/ignorance in this story...

White House Fires Back at Times Over Housing Meltdown Story

The New York Times, in a lengthy weekend article, places much of the blame for the sub-prime mortgage mess and Wall Street collapse on the Bush administration.

By James Rosen

FOXNews.com

Monday, December 22, 2008

The White House is pushing back hard against a New York Times article that essentially blamed President Bush for the sub-prime mortgage mess and the Wall Street collapse by linking those crises to a policy goal he stated more than six years ago.

That goal?

"We want more people owning their own home," as Bush said in December 2003.

But a 5,000-word article in the Times on Sunday, under the headline, "White House Philosophy Stoked Mortgage Bonfire," said Bush was also encouraging a "hands-off approach" to regulation that encouraged "lax" standards on behalf of lenders.

"He pushed hard to expand homeownership, especially among minorities, an initiative that dovetailed with his ambition to expand the Republican tent -- and with the business interests of some of his biggest donors," the article said.

"That's about as myopic as you can get," White House spokesman Tony Fratto said in response.
White House counselor Ed Gillespie lashed out at the Times for its interpretation of Bush's housing policies.

"They've had to mortgage their building in Manhattan to help make ends meet, and they've been reduced to junk-bond status. I don't know if the New York Times' shoddy reporting is the result of being in junk-bond status, or if their junk-bond status is what's resulting in their shoddy reporting," Gillespie said.

In fact, the Times' article ignored a wealth of its own reporting, dating back to the era of Bill Clinton, whom the article mentioned only once, in passing.

For example, in September 1999, the Times noted that, "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 stockholders to maintain its phenomenal growth in profits."

The 1999 piece went even further:

"In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times," the Times noted presciently. "But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's."

Likewise, the Times made no mention over the weekend of President Clinton's aggressive deregulation of the financial services industry, which empowered banks, brokerage firms and insurance companies to engage in some of the very practices -- such as credit default swaps -- that contributed most to the current fiscal crisis.

While the Times mentioned that mortgage bankers and brokers donated almost $850,000 to President Bush's 2004 re-election campaign, the newspaper omitted the fact that the top three recipients of campaign contributions from Fannie Mae and its sister organization Freddie Mac over the last two decades were all Democrats.

Connecticut Sen. Chris Dodd, head of the Senate Committee on Banking, Housing and Urban Affairs; President-elect Barack Obama; and Bush's 2004 opponent John Kerry all benefited from Fannie and Freddie.

Asked to respond to the White House criticism, Times Executive Editor Bill Keller said Sunday's article "was based on on-the-record interviews with dozens of current and former (Bush administration) officials."

"It is part of an ongoing series that examines in-depth the accountability of numerous players in the economic meltdown, including Congress, rating agencies, brokerage houses and the Fed," Keller said.

From http://www.foxnews.com/politics/2008...eltdown-story/

Absolutely amazing that the NY Times, failing because of incompetence, would point the finger at Bush when their own glory goon Democrats are truly at the heart of this misguided philanthropic bull crap...

Sad...

[vytoland]

greed & stupidity = mortgage melt down, bail outs, high taxation, crooked politicians, lack of priorities

[satellite66]

I'm surprised it took them this long. We all know that for the next 4 years at least we will hear how everything is Bush's fault.

[ponycar17]

Here's a pretty good assessment of what happened.

http://www.americanthinker.com/2008/...in_the_mo.html

Of course, the NY Times could never think so critically as to identify the root cause of a problem. News agencies like this identify the cause of problems in much the same way children do... By causality. If the child bumps his head on a rainy day he soon fears rainy days, instead of running outside in the rain. It's sad that these news agencies are so driven by their causes but I see no fix for them in sight until their income dries up due to reader backlash as reader refuse to buy the rag.

Many say that the newspapers are failing due to the internet. The fact is that these news agencies also run websites that people obviously choose not to visit.

[stetson]

I won't believe anything printed on this liberal rag!

[bountyh]

That is an overly simplistic analysis of the problem, but there is no question that not only Bush, but the republicans in general, base all of their reasoning on the belief that government is EVIl and that private business should be allowed to run without regulation.

Ronald Reagan once said, to a mass of cheers from his faithful:


"People think government can solve their problems....... but government IS THE PROBLEM."

Ignoring the obvious hypocrisy of those spoken words from a man who spent millions to head the government first of California and then the USA, the point is that republicans seem bent on destroying the power of government regulators and unleashing the free will of mankind.

And they have pushed deregulation and we have reaped the rewards...

savings and loan collaps.

energy deregulation led to Enron conspiring to starve power to the west coast gouging over $15 billion from us

The economic crisis we now have is the inevitable outcome which will ALWAYS occur when the natural greed of the men who run this country is allowed to run unchecked. As to exactly whose fault it is? We can start with the men charged with monitoring them... and then move onto the people who either eliminated or reduced the people who provided such oversight.

I hope to God we learn from this.

[bountyh]

Originally Posted by vytoland

greed & stupidity = mortgage melt down, bail outs, high taxation, crooked politicians, lack of priorities

But exactly what force on earth could put the fear of God into the crooks running wild over the last eight years when the watchword and marching orders was "DEREGULATE" and "Laissez Faire".

Look at the big crook Madoff (as in "madeoff" with the money) who ran a pyramid scheme taking in $60 BILLION and nothing was done even though there were repeated complaints filed with the SEC. The head of the SEC is appontied by the president and serves at his pleasure.... and implements the party line.

See no evil...... let them do whatever they want.

Madoff scandal badly embarrasses SEC investigators

Not since FEMA and Katrina has a federal agency been as badly embarrassed as the Securities and Exchange Commission. Supposedly Wall Street's top cop, the agency seems to have been asleep in the squad car.

Somehow an investment firm it was supposed to be regulating and regularly examining seems to have pulled off what could be the largest financial fraud in history -- $50 billion. And it might still be going on if the head of the firm, Bernard Madoff, had not told his two sons that he was running "basically a giant Ponzi scheme." They, in turn, alerted the feds.

Madoff, it seems, was an equal opportunity scam artist -- small investors, billionaires, hedge funds, charities, pension funds, multinational banks. True, Madoff had to be a master at gulling people if he fooled even his own family and presumably what were supposed to be some of the smartest people on Wall Street -- except that going back nine years, according to SEC Chairman Christopher Cox, credible and specific allegations that the fund was a fraud were "repeatedly brought to the attention of SEC staff."

The SEC never subpoenaed the firm's records but, according to a statement, "relied on information voluntarily produced by Mr. Madoff and his firm" -- except that Madoff kept several sets of books and the ones he produced were the phony ones.

True, the Bush administration and Congress under the Republicans had a strong mind-set against regulation. Meanwhile, budget cuts in enforcement, according to the agency's respected former chairman, Arthur Levitt, led to "a demoralizing of the enforcement staff."

But the Madoff case, rather than deregulation, comes close to no regulation at all. The SEC was created in 1933, the worst year of the Depression, to restore investor faith in the markets. That mission is now more important than ever and the SEC needs to once again become Wall Street's respected and feared top cop.

http://www.sentinelandenterprise.com...al/ci_11272090

[Tom]

Originally Posted by bountyh

But exactly what force on earth could put the fear of God into the crooks running wild over the last eight years when the watchword and marching orders was "DEREGULATE" and "Laissez Faire".

Look at the big crook Madoff (as in "madeoff" with the money) who ran a pyramid scheme taking in $60 BILLION and nothing was done even though there were repeated complaints filed with the SEC. The head of the SEC is appontied by the president and serves at his pleasure.... and implements the party line.

See no evil...... let them do whatever they want.




http://www.sentinelandenterprise.com...al/ci_11272090

No regulation? Are you smoking something?

Clinton tried to put bankers in jail for failing to provide loans to those who couldn't pay they back. That isn't regulation? Jamie Gorelick should go to jail for her part in this.

[ponycar17]

Originally Posted by Tom

No regulation? Are you smoking something?

Clinton tried to put bankers in jail for failing to provide loans to those who couldn't pay they back. That isn't regulation? Jamie Gorelick should go to jail for her part in this.

Tom, that is essentially the problem. Banks would never have been so stupid as to provide loans to very risky consumers if not for the government intervention of 1995 which expanded the Community Reinvestment Act and required banks to lend to so-called 'red-lined' districts where resale value of homes was very low and typical residents were at a high risk to default. It also forced the banks to stop being as conservative with their lending requirements so the target group Clinton wanted to help could qualify for loans.

Banks soon learned that lots of money could be made off of this government-introduced scheme. Banks bundled the small percentage of bad mortgages with a lot of good mortgages and resold those to domestic and foreign investors through mortgage-derived securities. As long as the net return on these securities was positive, investors were happy and banks could continue selling toxic debt in relatively safe large bundles. What happened though is that foreclosures started to creep up over the past 10 or so years to a point where home values could not continue to increase. Since home values are based on 'comparable values' and given that foreclosures sell for less on average (due to the banks' desire to sell the home quickly), the bottom fell out of the housing market. Home values had increased over the past 10+ years due to a steady increase in demand for homes and steadily decreasing lending requirements from the banks. Suddenly, consumers that had leveraged their whole home in mortgages and home equity lines were living in 'negative equity' land. They couldn't sell their homes and clear all of the mortgage debt if they needed to and consumers couldn't get homes appraised for the value needed to purchase them.

You could also say that the situation got progressively worse as home values continued to disproportionately rise while income didn't keep up... In my opinion that compounded the problem much more as banks were still willing to give more and more expensive loans to people who definitely could not afford them now.

Again I'll restate, banks would never have done this if not forced in 1995 to do so... It's the old saying, 'if you're given a lemon, start a lemonade stand...' Well, the banks were given road kill by the government and started a fine fur dealership.

Republican leaders such as Bush and even John McCain tried to do something about this problem from 2000 'til the bottom fell out but were met with opposition. After all, when the action is perceived to be 'helping minorities', you better not buck the system and question it's validity lest you be labeled racist.

[millwright]

My problem with having the government "mind the store" is who watches them ?

The "mortage crisis" resulted from the "government doing good" - just as did the "black family crisis", the "welfare crisis", the "gas crisis of '73" - and a long, long list of others occurring in my lifetime. What it comes down to, eventually, is the only protection from shysters and con games we have is our own intelligence and suspicion. "Government Protection" ain't never, ever, gonna be a worthwhile substitute for intelligence and caution.

Trusted all your dough to one individual because his track record's so much better than other's ? You ought to be asking "why ?", instead of planning how you'll spend the excess...... >MW

[dge479]

I love how whenever something goes bad, it was Bush's fault, No blam at all to those in charge of Ethics commitees,banking commitees,finance commitees etc.
Gonna get alot worse with this crap

[ponycar17]

Originally Posted by millwright

The "mortage crisis" resulted from the "government doing good"

That is EXACTLY right MW!!! That's a concept I can't get through to a liberal coworker of mine. He thinks in terms of Utopian ideals. He often says, "well if I were King of the world," and then elaborates on some well-meaning ideal he'd try to instate. The problem is that he's thinking about what SHOULD happen versus what WILL happen. This guy and those like him couldn't survive a semester of basic Micro or Macro Economics because he can't accept basic assumptions that have to be made to solve larger problems. Everything is in terms of what should be... It's sad.

Often times, legislating good deeds just does more harm to the group we're trying to protect. Look at raising the minimum wage as a good example. When we raise the minimum wage, we drive up the cost of all goods as retailers have to pay their cashiers and stockers more, and then the wage increase ripples throughout other similar businesses and often results in higher pay for those just slightly above the new minimum wage just to keep the businesses' job marketing competitive. In the end, the people we intended to help are only ahead of the curve for maybe a year until price and wage points stabilize and then they're back where they started as far as buying power is concerned. Meanwhile, we've devastated the homeless, disabled, those on Social Security and the Retired as they are not seeing a step increase in income but are still forced to purchase products at a higher price than before the 'help' came along.

This is where your comment about intelligence comes in... The simple problem (as my simple mind sees it) is that there is no longer public education taught about basic economics and finances (if there ever really was?). To get that knowledge, one has to seek it out through college or personal studies. No one knows enough to think critically about these issues and so we're at the mercy of vote-buying politicians who could care less if their constituency is really helped. Heck, it's easier for the politician if the public is poor and relatively ignorant of policy impacts. It's a sad state we're in now...

This is another reason I say that Democrats aren't really as supportive of education as they'd have voters believe. If we were on average more educated, we'd vote the whole lot out...

[Bruce FLinch]

Originally Posted by ponycar17

This is where your comment about intelligence comes in... The simple problem (as my simple mind sees it) is that there is no longer public education taught about basic economics and finances (if there ever really was?). To get that knowledge, one has to seek it out through college or personal studies. No one knows enough to think critically about these issues and so we're at the mercy of vote-buying politicians who could care less if their constituency is really helped. Heck, it's easier for the politician if the public is poor and relatively ignorant of policy impacts. It's a sad state we're in now...

This is another reason I say that Democrats aren't really as supportive of education as they'd have voters believe. If we were on average more educated, we'd vote the whole lot out...

We've sunk so low, I'm afraid your last statement may be "Utopian"...

[ponycar17]

Probably so Bruce...