TheAgitator.com
The Consequences of “Everyone Should Get To Own Their Own Home”
Monday, September 29th, 2008In 2003, the New York Times published an article about growing concerns over growing debt, risky mortgages, and questionable accounting practices at quasi-government businesses Fannie Mae and Freddie Mac. The following passage, featuring move-along, nothing-to-see-here quotes from the now-chair of the House Financial Services Committee Barney Frank (D-Mass) and committee member Rep. Melvin Watt (D-N.C.), seems relevant given what we know today:
Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.
”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”
Representative Melvin L. Watt, Democrat of North Carolina, agreed.
”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.
Allow me to reiterate.
low-income & affordable housing != the sub-prime mess
(definitely a subset of the problem, but not its entirety).
FWIW, 60% of sub-prime loans were refinances.
Let’s see, running up real estate prices to artificial (and unaffordable to most) levels is a good way to create affordable housing?
Wow, it’s almost like they were trying to bring this exact scenario about. Maybe they wanted this to happen so the government could gallop in on their $700 billion dollar white horse (don’t ask where the money for the horse came from) and save us all from “Capitalism.” It is a convenient excuse for another increase in government power.
I think Honeyko had a link to a Youtube video commenting on the Honrable Frank and Watts and their initiatives to help the poor with subprimes. If I remember correctly, this NY Times article was mentioned. He also had 3 down ticks because of it. But I guess when Radley brings it up, its ok.
I was one of those risky loaners. And I tell you, I told the truth on the application, but the A-hole who was “arranging” the loan smudged the truth to “help us” get approved. We waited a year to get it, after repeated stalling and points added on we finally got our piece of $hit house. Luckily this house when way way up in value and I sold it.
Now for the record I would just like to point out that they used people like me to make money, and keep the machine running for a few more years. And of course to make money off of everybody involved .
So please keep this in mind before blaming the poor or minorities for all this…Stuff. Thanks for listening,Will
should of said ” went way way up in value” sorry
To sum up the article…
The Administration was proposing more regulations for the housing industry (which as libertarians we see as bad) and 2 democrats were opposed to this additional regulation for non-libertarian reasons (but they were still opposed).
Did I get that right?
So was it regulation or the lack thereof or a combination of the 2 that we ended up with this mess?
It’s OK, Matt; ya just have to short those downticks and cover at the bottom! (I was up 18% today. Come ta Papa.)
Here’s all of Karl Denninger’s videos, sorted by date. Check out the two most recent.
Why did the market tank today?
– Half of it was Monday profit-taking from the opening-bell as well as an Apple Computer dowgrade crushing the Nasdaq. Then it went flat for awhile as the voting went on. Then it tanked after the bill failed. Why? Institutions were unloading their portfolios. Why? Because, denied the ability to loot the taxpayers, they now know they’re going to have to cover their own debts.
==//==
Oh, by the way: Paulson printed up another $650 billion of Monopoly Money today…not that anyone notices all that counterfeiting going on in broad daylight over at the Fed.
Did I get that right?
No.
That was five years ago, right? And those two guys cowed the entire financial establishment into avoiding regulation. Now that’s power!
Sick of Red and Blue? Wear your support of neither!
Check out:
http://www.other-brand.com/Political_s/3.htm
Lee,
There’s a critical distinction in who was to be the target of that proposed legislation. It’s more along the lines of “The Administration was proposing more regulations and oversight of the government entities which interfere in the housing industry (and whose existence we, as libertarians, see as bad) and 2 Democrats were opposed to this additional regulation as it limited the government’s ability to use the GSEs for risky social engineering.”
Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.
Unless we’re talking about Reagan Democrats here, aren’t these usually the same people who are constantly demanding tighter and tighter regulations on all businesses? Are they completely blind to the fact that the same regulations that stifle lenders would also stifle, say, local restaurants, or national “big-box” stores, or pretty much any other kind of business? I’m continually amazed by the selectivity of elected officials’ outrage.
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