Warnings of the Fanny/Freddy crisis were ignored

[SAWYER]

I think all sides are to blame, but found these quotes interesting, especially Barney Frank
http://www.youtube.com/watch?v=gzEIMco49AE
Bush Administration, 2002 Budget Request, April 2001
The size of mortgage giants Fanny May and Freddy Mac is a "potential problem" because financial trouble in either one of them could "cause strong reprucussions in financial markets."

Secretary Treasurer John Snow, September 10, 2003
"...We need a strong world class regulatory agency to oversee the prudential operations of GSEs...and the safety and the soundness of their financial activities..."


Democrat Congressman Barney Frank, now Chairman of the Financial Housing Services Committee, September 10, 2003
"...Fannie May and Freddy Mac are not in a crisis..."

"...The more people, in my judgment, exaggerate a threat of safety and soundness...the more people conjure up the possibility of serious financial losses to the treasury which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios....and even if there were a problem the federal government doesn't bail them out. But the more pressure there is there...Then the less, I think, we see in terms of affordable housing..."

Democrat Senator Charles Schumer, Senate Banking Committee Hearing, April 5, 2005
"I think Fannie and Freddie over the years have done an incredibly good job and are an intrisic part of making America the best-housed people in the world....if you look over the last 20 or whatever years, they've done a very very good job."


Republican Senater John McCain, Senate Floor, May 25, 2006
"For years I've been concerned about the regulatory structure that governs Fannie May and Freddy Mac...and the sheer magnitude of these companies and the role they play in the housing market....the GSE's need to be reformed without delay."

 

[badnewcastle]

Awsome Post, probably won't get any love here on Anandtech, but if you want to know when or where it all started, lets go back to a New Your Times article in 1999:

"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."

- Stephen A Holmes
Published on September 30, 1999

NYT Link.

 

[IceBergSLiM]

Originally posted by: badnewcastle
Awsome Post, probably won't get any love here on Anandtech, but if you want to know when or where it all started, lets go back to a New Your Times article in 1999:

"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."

- Stephen A Holmes
Published on September 30, 1999

NYT Link.

most important piece

 

[RightIsWrong]

While trolling over your right-wing blogs, you must not have seen that for all of Bush's warnings, he was about as concerned as he was that Saddam would fire his WMD back at US troops.

Bush two months after his first "warning" about the scary size of the FMs

And let me talk about some of the progress which we have made to date, as an example for others to follow. First of all, government sponsored corporations that help create our mortgage system -- I introduced two of the leaders here today -- they call those people Fannie May and Freddie Mac, as well as the federal home loan banks, will increase their commitment to minority markets by more than $440 billion. (Applause.) I want to thank Leland and Franklin for that commitment. It's a commitment that conforms to their charters, as well, and also conforms to their hearts.

This means they will purchase more loans made by banks after Americans, Hispanics and other minorities, which will encourage homeownership. Freddie Mac will launch 25 initiatives to eliminate homeownership barriers. Under one of these, consumers with poor credit will be able to get a mortgage with an interest rate that automatically goes down after a period of consistent payments. (Applause.)

Fannie Mae will establish 100 partnerships with faith-based organizations that will provide home buyer education and help increase homeownership for their congregations. I love the partnership. (Applause.)

The Enterprise Foundation and the local initiative support corporation will increase efforts to build and rehabilitate more homes in inner cities at affordable prices by working with local community development corporations.

He was so concerned that he added additional funds and vehicles to their arsenal so that they could grow even bigger.

 

[heyheybooboo]

This is only the 4th or 5th time thread efforts have been made to put lipstick on this pig and make it fly ....

 

[SAWYER]

LOL@bitter defenders of either side. Bush along with numerous other incompent politicians on both sides are to blame.

 

[ElFenix]

weren't fannie and freddie involved in an accounting scandal shortly after barney said they were fine?

 

[GTKeeper]

Originally posted by: ElFenix
weren't fannie and freddie involved in an accounting scandal shortly after barney said they were fine?

Its hard to tell that a company is fine, when its books are coocked.

 

[fskimospy]

This is for all meaningful purposes a repost x5 or so.

 

[Doc Savage Fan]

Barney Frank - Chairman of the House Financial Services Committee

What a joke.

 

[badnewcastle]

Originally posted by: IcebergSlim

Originally posted by: badnewcastle
Awsome Post, probably won't get any love here on Anandtech, but if you want to know when or where it all started, lets go back to a New Your Times article in 1999:

"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."

- Stephen A Holmes
Published on September 30, 1999

NYT Link.

most important piece

How is that different then any other company big or small, the difference is that the government was involved in pushing anything... Stockholders for any company will pressure their companies' to maintain phenomenal growth. It's the part where the government gets involved that bothers me, they shouldn't be pressuring a company unless they are doing something illegal and in this case the pressure needed was the opposite of what it should have been. Like I said all sides are to blame.

 

[dmcowen674]

Originally posted by: IcebergSlim

Originally posted by: badnewcastle
Awsome Post, probably won't get any love here on Anandtech, but if you want to know when or where it all started, lets go back to a New Your Times article in 1999:

"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."

- Stephen A Holmes
Published on September 30, 1999

NYT Link.

most important piece

As well as all my posts dating back 8 years.