Ignore the spin and media histrionics. Do the research. Eventually the truth does come out as it always does. In this case, most if not all of the Fannie Mae trainwreck can be blamed on the Clinton Administration and the Democrats. OFHEO warned in 2006 Fannie was out of control and lying on its balance sheets. The Bush Administration tried to reform Fannie and Freddie in 2003 only to be stopped by Congressional Democrats such as Barney Frank who said there was no problem to fix. Senators Hagel and McCain tried to pass legislation tightening the supervision of the agencies in 2005. Meanwhile, former Clinton Administration officials-turned-Fannie Mae executives such as Jamie Gorelick, Frank Raines and others walked out of Fannie Mae with over $100 million in compensation after illegally manipulating earnings statements and engaging in Enron-type fraud. While lining their pockets, they and their Democrat allies were corrupting our mortgage system as The New York Times reported in 1999:

In retrospect, they should have tried harder. They had control of the House, but of course the Senate filibuster was in their way. Don’t over look the huge racial aspects of the whole affirmative action for mortgages going on at Fannie Mae. And also this was the time when the Republicans were coming into there own having just learned how to spend money like a Democrat.

So much finger pointing to accomplish, so little time. Maybe if it wasn’t POTUS election season.

That's a pretty convenient scape goat.

So what Clinton did in 1999 is now sending the economy into the toilet almost 10 years later.  Riiiight.  I guess what Jimmy Carter in 1977 actually fueled the economy when Reagan was president in 1986 right?

And Barney Frank must be one powerful Congressman!  He actually stopped Bush from reforming Fannie and Freddie in 2003 when Republicans controlled the Presidency, the House, and the Senate.

Plenty of blame to go around on both sides Balboa.  But pointing fingers 10 years back doesn't hold much water.

FM and FM have a long history of cronyism for Democrats.

I believe I said "plenty of blame to go around on both sides."

So I'll condense.

Fannie and Freddie saw market share decline in the subprime market in 02-06 because the private investment houses were accelerating their exposure to subprimes through MBS. These companies were not regulated by the CRA, by the way so it's wrong to blame some affirmative action in housing.

The CEOS of Merrill Lynch, Goldman Sachs, and Morgan Stanley received hundreds of millions in bonuses from 2003-2007, much of that was gained by hiding losses from the subprime mess. Does that make them as culpable as Raines?

The CRA was passed in 1977. It took 41 years for it to wreck the financial system? Bullshit. In fact, a Harvard study in 2002 and a Brookings Institute study in 2005 both found that the CRA regulated banks had healthier mortgage portfolios than non CRA regulated institutions. And please don't use that tired old BS about Harvard and the Brookings Institute being fronts for ultra liberalism. Then you have to dismiss the Cato Institute, the Hoover Institute and the U of Chicago as mouthpieces for the right.

13% of outstanding mortgages are subprime and 20% of those should have been qualified for more conventional mortgages at lower rates/fees. Now, foreclosures of prime mortgages are greater than subprime. Clearly, the problem extends much deeper than the echo chamber's "affirmative action in the housing market".

The republican party has been in the White House for 20 of the past 28 years and mostly had control of congress from '94 till 02. They have appointed the Fed chairman as well as a huge majority of federal judges since 1980. Yet, with all that power, they couldn't overcome Barney Frank? Kudos to Frank! He must be the single most powerful man on the planet. Come one. How can the party in power for so long deny that what happened on their watch is their fault? Well, they could lie and obfuscate, I guess.

The Office of Federal Housing Enterprise Oversight was created in 1992 (by democrats) with the goal of providing greater oversight of the mortgage industry which by then was beginning to use MBS to reduce the risk of loaning to lower income families. The mortgage industry fought this regulation very hard with a tremendous lobbying effort and won.

Frank's claim that there was no brewing crisis in the mortgage industry was as wrong as it can be, but blaming him for the current mess is just dumb. There is plenty of blame to go around, but the party in power for most of the last 15 years has to shoulder most of that blame.

Or are republicans so incompetent that they can't actually exercise that power?

the Republicans are SO guilty and
the Democrats are SO innocent then why
aren't Barney Frank and Christopher Dodd both clamering for Congressional hearings to prove it and expose the 'truth'?

Curious, what is a Wormwood?  Would it be a small thin dick?  Or dickhead?

Enquiring minds want to know.

Nah. The dems aren't innocent. Like I said, there's plenty of blame to go around.

However, can you explain to me how the party in control of all three branches of government for most of the last 15 years shouldn't also be the party most responsible for this fiasco? Are Frank and Dodd really that powerful?

It contains a chemical, thujone, that gives absinthe its extra kick, hardly needed when absinthe is 45-75 percent alcohol.

The herb also "stuns" intestinal worms so that they may be passed. Hence its name.

It seems that every other fantasy novel written has to have some character named Wormwood. Most famously, it's the name of a demon in C.S. Lewis's novel "The Screwtape Letters."

So, leave him alone about his handle.

Repubs dictated that, wouldn't have it any other way, and convinced the public that this was the only good way. So the Democrats were left to turn to the market to aid the poor.

Unfortunately, the market has proved itself unable to perform the social functions of government.

So, now freddie and fannie were infiltrated by Democrats who mismanaged it. More, we're supposed to believe that a lame-duck President who wasn't known to pressure anybody domestically, shoved Fannie Mae and Freddie Mack into disaster that just happened to unfold at the end of the Bush administration.

Wow! that clears things up. Glad you found a story to match your ideological feelings.

I find it hard to believe that the Democrats such as Barney Frank were in a position to stop anything. The "revolving door" you described has been a huge problem long before this, and mostly favoring Republicans. I'm glad you discovered it. I would encourage you to look at how Repubs have been using it and how much money they have pocketed.  

I'll add the Bush administration and Tom Delay destroyed any working relationship with the Democrats pretty early on. Before I would trust the Republican efforts to "reform" Fannie and Freddie, I would want to see exactly what the bills said. Republican reforms are usually a matter of funneling tons of money to somebody. Which is probably why the Democrats had reservations about reforms.

Anybody who bothered to look five years ago could see that Freddie and Fannie were in trouble. I read articles in the "The Economist" which basically demonstrated that. They also predicted this whole crisis. That's the best magazine in the world if you want to understand the economy and politics.

I don't know if I'd call what happened with F&F an "Enron like fraud," because what has actually happened is that these mortgage-backed securities, default-swaps, and generally, derivative in general have proven to be poison. I'm not sure if anybody at F&F knew how account them.

When Congress autopsies this crisis, I think there will be some deep investigations.  

-- Modified on 9/30/2008 9:19:06 PM

You obviously haven't been reading my posts about the blame.

I didn't just write seven paragraphs blasting ONE side, then add a SINGLE trailing sentence 'there's plenty of blame to go around' and then claim to be even headed and equal handed in my analysis.

Read my posts. Even just the one above. I actually LED with the main point of blaming the Republicans.

C'mon now. You can say it. Just try.

Repeat after me, "The republicans are more to blame for thee current mess than the democrats."

Until you utter those very words, you're just another dissembling apologist for the current regime.

I have absolutely no idea yet what the scorecard should read. I’ve called for investigations. Why can’t you answer my question about investigations? You’d rather simply call me names. Now that’s as useful as tits on Pelosi.

My premise was never that Frank and Dodd were soley or even majorly responsible. The question was why haven't they called for hearings? And yes they ARE powerful enough as committee chairmen to do as much, TODAY.

-- Modified on 10/1/2008 4:32:14 PM

have been committee chairs for 2 of the last 14 years. But you think they may be as much to blame as the people who were actually in charge for 12 of the last 14.

That's fair and balanced.

Look up the definition of the words I've used, since you seem confused as to what I've stated. Start with majorly. It's clear that I don't believe the points that you are attempting to claim as mine. I repeatdly asked you a very simple question that you've chosen to ignore. I can only assume that it's because you know the answer but refuse to admit it. Instead you cherry pick your facts. I think I'm bored talking to the wall.

And so is yours. You continue to do nothing except apologize for the republicans- the party which was in power while this mess developed. You do nothing except try to throw blame elsewhere, like on two congressmen who have been committee chairs for 2 years. You make a pretense every once in a while about being fair by making some bullshit vague comment like, "The republicans could have tried harder..." and then claim to have place appropriate blame for the crisis.

Wait until after the election and see if Frank and Dodd don't convene hearing on the current mess. One reason they aren't doing so now is that it would be a distraction from the more important issue of electing a president. The same people who are to blame now will still be to blame in January. I'm also sure that they are not proud of their roles in the financial meltdown but if you think they are not calling for hearings because they might be exposed to blame, you're just following the echo chamber's talking points.

I think you rather enjoy talking to the wall. That way you only hear your own ideas echoed back to you and you don't actually have to think.

Now what was that Mill quote again?

Does making stuff up about me allow you to sleep better at night? You haven’t seen a single apologetic remark pass my keyboard. The remark about ‘they could have done more’ was in context of the thread (actually the sentence) discussing the 2004 video of the banking committee, when they (Republicans) were in charge. They should have tried harder. I suppose my assertion that they probably didn’t because of the racially charged aspects could be seen as an apology (but it’s not), but then who created that atmosphere?

You won’t find a single remark of mine blaming Frank and Dodd for the ‘crisis’. Do so and I’ll apologize for it.

Like I said, you cherry pick data, all to funnel yourself into a predetermined result. The Reagan and Bush One years as President are somehow important to your point (they must be since you cited them yet ignore the control of Congress during that period. The Republicans appointed all the Fed Chairman? No Clinton did also (same guy, whoops what’s that mean?)

You haven’t laid out a single piece of evidence or a specific example of where any Dem participated in creating the situation. When it comes to the end all you say is, “There’s plenty of blame. . . Oh I’m sure they FEEL bad. . .and they are NOT proud”, as if that somehow matters one didily squat.

I hope you are correct. Let’s hope that there are fair hearings soon.

-- Modified on 10/2/2008 8:53:17 AM

for me to single out any dems for blams. You guys on the right spew it all the time and a little of it is even correct.

Frank was wrong to oppose the changes in the mortgage industry that he opposed. Franklin Raines was wrong to cook the books and expose Fannie to such risk and he shoudl be in jail. Clinton was wrong to reappoint Greenspan.

All those are drops in the bucket, except for reappointing Greenspan who directed the Fed while  the conditions for both the .com and housing bubbles arose. Thanks a bunch Alan. The people who are responsible for this debacle are the ones who created MBS and came up with the grand idea of no doc mortgages. Those are the people who ran the investment houses and large banks for the last 15 years and who were given free reign by the people who controlled Washington for most of the last 15 years.

Agree or disagree, RWU? The vast majority of people who are in leadership positions of large banks and investment houses are republicans, right? The republicans were in control of all 3 branches of government for most of the last 15 years, right? Well, then shouldn't the republicans be the people who shoulder the lion's share of the blame?

This mess developed while the republicans deregulated themselves into impotency and while we sprinted farther down the road to national bankruptcy by fighting a war we didn't need to fight. This mess was created by greedy asshole republican bankers who designed mortgage instruments which have no actual value and turned capital markets into casinos. Thorstein Veblen was right about these assholes.

And your only criticism of the republicans is "they should have tried harder" ? Wow, that's some strong blaming there.

Here are a couple updated links that anyone interesting in the cause of the housing crisis should look at. The original were removed because the background music was "Burning down the house" by the talking heads, and of course there were compaints.  

interesting and well done videos, just lousy music now.

http://www.youtube.com/watch?v=NU6fuFrdCJY&feature=related

http://www.youtube.com/watch?v=1RZVw3no2A4&feature=iv&annotation_id=event_986162