Media Parrots Obama Financial Crisis Propaganda

Discussion in 'Politics & Religion' started by pspr, Nov 10, 2011.

  1. pspr


    At the October 11 GOP Presidential primary debate on Bloomberg TV, Karen Tumulty of the Washington Post asked candidate Michelle Bachmann if Wall Street bankers had been adequately punished for “the damage they did to the economy.” In reply, Bachmann schooled the uninformed Tumulty, saying,

    “If you look at the problem with the economic meltdown, you can trace it right back to the federal government. It was the federal government that pushed the subprime loans. It was the federal government that pushed the Community Reinvestment Act…. We had lending standards lowered for the first time in American history. The fault goes back to the federal government."

    Newt Gingrich affirmed the same view......
  2. This tendency to shift blame to minorities and poor people for the financial crisis soon developed into a well-honed narrative on the right. Swiftly and repeatedly many conservatives blamed affordable housing policies—particularly the affordable housing goals in place for the two government sponsored mortgage finance giants Fannie Mae and Freddie Mac and the 1977 Community Reinvestment Act that applies to regulated lenders such as banks and thrifts—for the massive financial crisis that occurred."


    "Equally conclusive are the default rates of mortgages originated for these various lending channels. If the conservative view was correct, one would expect to see mortgages originated for Fannie and Freddie securitization, as well as those originated for purposes of CRA, to default at higher rates, since these were the loans directly subject to affordable housing policies. In fact, we see quite the opposite, as these loans have performed exponentially better than those originated for private securitization, which the FCIC Republicans ignore.

    Mortgages originated for private securitization defaulted at much higher rates than those originated for Fannie and Freddie securitization, even when controlling for all other factors (such as the fact that Fannie and Freddie securitized virtually no subprime loans). Overall, private securitization mortgages defaulted at more than six times the rate of those originated for Fannie and Freddie securitization.

    Similarly, mortgages originated for CRA purposes have performed at much higher rates than loans originated for private securitization, going into foreclosure 60 percent less often than loans originated by independent mortgage companies that were key to providing the mortgages needed to supply private securitization."
  3. How much does adding every subprime loan together in the U.S. amount to? (Call that exhibit #1)

    If you assume every single one defaulted - a stretch because not all did - but if you assume every one of them did, how much does that total (meaning the loans themselves - as LOANS)?

    How much was U.S. GDP the year of the crash? How much was the rest of the World's GDP that year? (Call that exhibit #2a and #2b)

    How did exhibit #1 manage the crash exhibit #2a and #2b combined to send the world into the Great Recession/Depression2?

    Can anybody ask Newt this?
  4. pspr


    David M. Abromowitz? Now there's a guy who knows how to twist a few facts into a bunch of double talk.
  5. That's a liberal red herring, as is blaming it all on the "banksters."

    The crisis absolutely could not have happened without the government incessantly pushing and enabling home ownership through mortgage tax policy, interest rates, pandering, GSEs, the repeal of Glass Steagall and enactment of Gramm-Leach-Bliley, etc.., etc.

    It also could not have happened without millions of ignorant, greedy sheeple buying more house than they could afford and then using those houses as ATMs to take out almost $1 trillion.
  6. An interesting development in the mortgage mess is that the big banks have been negotiating with (formerly) 50 state AG's to settle with paying a fine and sweeping it under the rug.

    This effort has been led by the state AG from Iowa - Tom Miller, a Democrat.

    The Obama admin has been attempting to strong-arm AG's who do not go along with the settlement, trying to cut off independent investigations by AG's. They want it all swept under the rug before the election rolls around.

    Now, one might figure that this is a perfect platform for Republicans to stand on - the Obama admin interfering with state investigations. The Federal government intruding on the jurisdiction of the states would appear to be a no-brainer to speak out against.

    But so far, they are mostly silent. Which of the presidential candidates has raised this in the debates? Why don't they hammer Obama on this one?
  7. Because the banking lobby funds both sides of the aisle. Much easier to do business when the elections don't matter and your "bought and paid for" politician will do whatever you tell him to do.
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    The point is to blame CRA for this financial crisis is bullshit. Subprime loan to the low income y minorities is prove to have lower default rate under the CRA. When some banks find is so much profit to sell this bundles of mortgages they market with aggression with big lies to tell people who are uneducated or not speak the language... is ok to take this loan because you can refinace in few years to lower rate. So they exploit greed and ignorance of immigrants AND American poor people for the short term big profit for them, but is long term crisis for your country. You tell me the bank is not aware what they do? They are paid to calculate risk true? But this risk is sold to the greater fool.
    Then you have the bets made on default from this same people who finace the beginning. ABX hmmm?
  9. Pretending that greedy sheeple are victims is bullshit, so is pretending the government didn't set the stage for this and then let it happen, so is blaming it all on "banksters."
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    When the banks find big profit in (securitization) of the loans, they want more loans. They want volume. They know institutional investors make the market for these bundles. This institutional investors chasing the yield. So securitization become really big business and they look for more products to secure/bundle/sell/pass the risk. Where do they look when the prime market is bundled and sold, but they want more? They go to the subprime for this volume. But they go outside of the federal regulation and fund the private brokers/originators to get this volume. Really not caring of this risk because they sell the risk and have no skin for the game when they sell. With some kind of risk model they bundle this very, very high risk loans with the AAA rating for investment grade. Then becomes the creation of swaps on these too. Then becomes the leverage too.
    You really think poor people and minorities y greedy uneducated people and CRA make this huge financial big mess all over this world? Or is this from some stupid model to bundle high risk junk in the AAA package, sell to pensions/hedge funds/mutual funds? And then make the swaps on these to bet against?
    #10     Nov 12, 2011