Albatrossity2
Posts: 2780
Joined: Mar. 2007
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A little more fact-checking on FtK's recent posts, which seems to come directly from a McCain campaign site. She observes | Quote | This Fannie/Freddie travesty could have been stopped if Democrats in congress had allowed for legislation to pass that would have protected all of us.
It's so irritating it keeps me awake at night thinking about it. My family has been directly hit by this mess, and my husband had to close his business of 10 years due to what Fannie & Freddie did to the housing market. |
But according to a story in today's KC Star | Quote | A campaign that blames the global financial crisis on a government push to make housing more affordable for lower-class Americans has taken off on talk radio and in e-mail. Commentators say that was what triggered the stock market meltdown and the freeze on credit. They specifically target Fannie Mae and Freddie Mac, the mortgage finance giants that the federal government seized Sept. 6. They say that lending to poor and minority Americans caused Fannie’s and Freddie’s financial problems.
Federal housing data reveal that the charges aren’t true, and that the private sector, not the government or government-backed companies, was behind the soaring subprime lending at the core of the crisis.
Subprime lending offered high-cost loans to the weakest borrowers in the housing boom from 2001 to 2007. Subprime lending was at its height from 2004 to 2006.
Federal Reserve Board data show that:
•More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions.
•Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year.
•Only one of the top 25 subprime lenders in 2006 was directly subject to the housing law that the critics lambaste. |
Once again, actual data contradict FtK's opinion. More specifically, the article goes on to state | Quote | | From 2004 to 2006, when subprime lending was exploding, Fannie and Freddie went from holding 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication. One reason is that Fannie and Freddie were subject to tougher standards than many of the unregulated players in the private sector. |
It doesn't look like anyone should lay awake at night worrying about Fannie Mae's and Freddie Mac's contributions to the problem. Once again, the unregulated free market, the altar at which all real Republicans worship, failed. So I think it might be more prudent to worry about what would happen if McBush and Bush Lite got elected; their understanding of economic policy is in the same league as born^again77's understanding of "materialism".
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Flesh of the sky, child of the sky, the mind
Has been obligated from the beginning
To create an ordered universe
As the only possible proof of its own inheritance.
- Pattiann Rogers
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