The savings and loan debacle was one-seventieth the size of the current crisis, both in terms of losses and the amount of fraud. In that crisis, the savings and loan regulators made over 30,000 criminal referrals, and this produced over 1,000 felony convictions in cases designated as “major” by the Department of Justice. But even that understates the degree of prioritization, because we, the regulators, worked very closely with the FBI and the Justice Department to create a list of the top 100 — the 100 worst fraud schemes. They involved roughly 300 savings and loans and 600 individuals, and virtually all of those people were prosecuted. We had a 90 percent conviction rate, which is the greatest success against elite white-collar crime (in terms of prosecution) in history.
In September 2008 Joseph Stiglitz stated that Greenspan "didn't really believe in regulation; when the excesses of the financial system were noted, (he and others) called for self-regulation – an oxymoron."[74] Greenspan, according to The New York Times, says he himself is blameless.
In Congressional testimony on October 23, 2008, Greenspan finally conceded error on regulation. The New York Times wrote, "a humbled Mr. Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending. ... Mr. Greenspan refused to accept blame for the crisis but acknowledged that his belief in deregulation had been shaken." Although many Republican lawmakers tried to blame the housing bubble on Fannie Mae and Freddie Mac, Greenspan placed far more blame on Wall Street for bundling subprime mortgages into securities.
clearly they failed to manage things in the best interest of the country.
completely devoid of any fraud
Not to mention that Eric Holder prosecuted big banks (that even donated to Obama campaign) such as J.P. Morgan for record-breaking $13 billion. But of course no one remembers that because a banker wasn't put in a physical prison for a non-violent crime.
It's not a government conspiracy and it's not a corporate conspiracy
It's not like those big banks didn't lose lots of money during the crisis. THEY DID. Then to turn around and prosecute them for fraud when they didn't even try to defraud anyone and they abide by the laws while they lost tons of money during 2008 themselves.
free-market capitalism
tell me then why 50% of the WORLD POPULATION makes less than $2 per day.
Tell me why we usually install dictators, not democratic systems, in the nations we invade (it's because they will maintain their borders, protect resources that they sell to us cheaply
Tell me why we assassinate those who aren't corrupted by our bribery.
Tell me why the ex-prime minister of Iraq, who OUR invasion and OUR new government resulted in in 2006, helped to radicalize many Muslims against not only our government,
tell me then why 50% of the WORLD POPULATION makes less than $2 per day
"That is absolutely untrue. Where did you hear that? Those are the kind of talking points that, if you actually look at unbiased statistical data, just don't begin to hold water. Do not ever mistake actions taken to advance capitalist agendas as a form of aid. There's only one capitalist agenda, and that is the accumulation of wealth: profit above all costs, whether human, social, or environmental."
"Until the 1960s, the Aral Sea was fed by two rivers, the Amu Darya and Syr Darya, which brought snowmelt from mountains to the southeast, and local rainfall. But in the 1960s the Soviet Union diverted water from the two rivers into canals to supply agriculture in the region. With the loss of water, the lake began to recede and its salinity levels began to rise. Fertilizers and chemical runoff contaminated the lake bed. As the lakebed became exposed, winds blew the contaminated soil onto the surrounding croplands, meaning even more water was needed to make the land suitable for agriculture, according to an Earth Observatory release. The falling water levels changed the local climate, too. Without the lake water to moderate temperatures, winters became colder and summers hotter, the Earth Observatory said."
In fact if somebody tried to charge them with something illegal, they would have an extremely strong defense that they were actually just complying with federal laws as written at the time.
they were actually explicitly required by the federal government under both the 2000 and 2005 Affordable Housing Regulations HUD put out.
The Commission concludes that the collapse of the housing bubble began the chain of events that led to the financial crisis. High leverage, inadequate capital, and short-term funding made many financial institutions extraordinarily vulnerable to the downturn in the market in 2007. The investment banks had leverage ratios, by one measure, of up to 40 to 1. This means that for every $40 of assets, they held only $1 of capital. Fannie Mae and Freddie Mac (the GSEs) had even greater leverage—with a combined 75 to 1 ratio. Leverage or capital inadequacy at many institutions was even greater than reported when one takes into account “window dressing,” off-balance-sheet exposures such as those of Citigroup, and derivatives positions such as those of AIG. The GSEs [Fannie Mae and Freddie Mac] contributed to, but were not a primary cause of, the financial crisis. Their $5 trillion mortgage exposure and market position were significant, and they were without question dramatic failures. They participated in the expansion of risky mortgage lending and declining mortgage standards, adding significant demand for less-than-prime loans. However, they followed, rather than led, the Wall Street firms. The delinquency rates on the loans that they purchased or guaranteed were significantly lower than those purchased and securitized by other financial institutions. The Community Reinvestment Act (CRA)—which requires regulated banks and thrifts to lend, invest, and provide services consistent with safety and soundness to the areas where they take deposits—was not a significant factor in subprime lending. However, community lending commitments not required by the CRA were clearly used by lending institutions for public relations purposes.
It is simply untrue to argue that the Feds didn't have a primary role (along with people in the private sector) in creating the mess.
"From 1997 to 2000, 42% of GSE purchases were required to meet goals for low and moderate-income borrowers. In 2001, the goal was raised to 50%.Mudd said that as long as the goals remained below half of the GSEs’ lending, loans made in the normal course of business would satisfy the goals: “What comes in the door through the natural course of business will tend to match the market, and therefore will tend to meet the goals.”Levin told the FCIC that “there was a great deal of business that came through normal channels that met goals” and that most of the loans that satisfied the goals “would have been made anyway.”
Hempstead, Fannie’s principal contact with Countrywide, told the FCIC that while housing goals were one reason for Fannie’s strategy, the main reason Fannie entered the riskier mortgage market was that those were the types of loans being originated in the primary market.If Fannie wanted to continue purchasing large quantities of loans, the company would need to buy riskier loans. Kenneth Bacon, Fannie’s executive vice president of multifamily lending, said much the same thing, and added that shareholders also wanted to see market share and returns rise. Former Fannie chairman Stephen Ashley told the FCIC that the change in strategy in 2005 and 2006 was owed to a “mix of reasons,” including the desire to regain market share and the need to respond to pressures from originators as well as to pressures from real estate industry advocates to be more engaged in the marketplace.
The Commission concludes that the business model of Fannie Mae and Freddie Mac (the GSEs), as private-sector, publicly traded, profit-making companies with implicit government backing and a public mission, was fundamentally flawed. We find that the risky practices of Fannie Mae—the Commission’s case study in this area—particularly from 2005 on, led to its fall: practices undertaken to meet Wall Street’s expectations for growth, to regain market share, and to ensure generous compensation for its employees. Affordable housing goals imposed by the Department of Housing and Urban Development (HUD) did contribute marginally to these practices. The GSEs justified their activities, in part, on the broad and sustained public policy support for homeownership. Risky lending and securitization resulted in significant losses at Fannie Mae, which, combined with its excessive leverage permitted by law, led to the company’s failure. Corporate governance, including risk management, failed at the GSEs in part because of skewed compensation methodologies. The Office of Federal Housing Enterprise Oversight (OFHEO) lacked the authority and capacity to adequately regulate the GSEs. The GSEs exercised considerable political power and were successfully able to resist legislation and regulatory actions that would have strengthened oversight of them and restricted their risk-taking activities. In early 2008, the decision by the federal government and the GSEs to increase the GSEs’ mortgage activities and risk to support the collapsing mortgage market was made despite the unsound financial condition of the institutions. While these actions provided support to the mortgage market, they led to increased losses at the GSEs, which were ultimately borne by taxpayers, and reflected the conflicted nature of the GSEs’ dual mandate. GSE mortgage securities essentially maintained their value throughout the crisis and did not contribute to the significant financial firm losses that were central to the financial crisis.
has also justified the extra-judicial execution of American citizens have been used to kill possibly thousands including American citizens
And banks and lenders carried through that fraud to every level of the mortgage process. They committed origination fraud through faulty appraisals and undisclosed trickery. They committed servicing fraud through illegal fees and unnecessary foreclosures. They committed securities fraud by failing to inform investors of the poor underwriting on loans they packaged into securities. They committed mass document fraud when they failed to follow the steps to create mortgage-backed securities, covering up with fabrications and forgeries to prove the standing to foreclose. By the time the bubble collapsed, the recession hit and Holder took over the Justice Department, Wall Street was a target-rich environment for any federal prosecutor. Physical evidence to an untold number of crimes was available in court filings and county recording offices. Financial audits revealed large lapses in underwriting standards as early as 2005. Provisions in the Sarbanes-Oxley Act, passed during the last set of financial scandals in 2002, could hold chief executives criminally responsible for misrepresenting their risk management controls to regulators. Any prosecutor worth his salt could have gone up the chain of command and implicated top banking executives.
as no laws were broken
Holder has a mixed legacy: excellent on civil and voting rights
Eric Holder is an incompetent scumbag
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