It was enough to cause the whole house of cards to come tumbling down.Originally Posted by Reality_Check
Is very uneasy
It was enough to cause the whole house of cards to come tumbling down.
When given the choice between big business and big government, choose big business. Big business never threw millions of people into gas chambers, but big government did.
"It does not take a majority to prevail, but rather an irate, tireless minority, keen on setting brushfires of freedom in the minds of men" -Samuel Adams
Is very uneasy
Not Ron Paul.
When given the choice between big business and big government, choose big business. Big business never threw millions of people into gas chambers, but big government did.
"It does not take a majority to prevail, but rather an irate, tireless minority, keen on setting brushfires of freedom in the minds of men" -Samuel Adams
prime rib rocks hard!
20% is a lot. during the great depression only 25% of america lost their jobs, look what that did to this country. IE it was over 70 years ago and a lot less population, but 20% is still a lot with numbers and a population the size of the usa.
Registered User
And the other 80% of the subprime mortgages had nothing to do with this? The ones not covered by the CRA.
http://www.investopedia.com/ask/answ...e-mortgage.asp
"A subprime mortgage is a type of loan granted to individuals with poor credit histories (often below 600), who, as a result of their deficient credit ratings, would not be able to qualify for conventional mortgages. Because subprime borrowers present a higher risk for lenders, subprime mortgages charge interest rates above the prime lending rate.
There are several different kinds of subprime mortgage structures available. The most common is the adjustable rate mortgage (ARM), which initially charges a fixed interest rate, and then convert to a floating rate based on an index such as LIBOR, plus a margin. The better known types of ARMs include 3/27 and 2/28 ARMs.
ARMs are somewhat misleading to subprime borrowers in that the borrowers initially pay a lower interest rate. When their mortgages reset to the higher, variable rate, mortgage payments increase significantly. This is one of the factors that lead to the sharp increase in the number of subprime mortgage foreclosures in August of 2006, and the subprime mortgage meltdown that ensued. (To learn more, read The Fuel That Fed The Subprime Meltdown.)
Many lenders were more liberal in granting these loans from 2004 to 2006 as a result of lower interest rates and high capital liquidity. Lenders sought additional profits through these higher risk loans, and they charged interest rates above prime in order to compensate for the additional risk they assumed. Consequently, once the rate of subprime mortgage foreclosures skyrocketed, many lenders experienced extreme financial difficulties, and even bankruptcy."
So, you are claiming that those subprime loans (the 80%) were just fine and dandy, but those loans by institutions regulated by the CRA were the ones that were the whole problem?
Registered User
It's not 20% of the population, it's 20% of the subprime loans. That is a much smaller set of numbers.
This is interesting: http://www.responsiblelending.org/is...-subprime.html
Registered User
Once again I need some proof.
I'll take everyone's word that private banking was "forced" to make 20% of loans to lower income higher risk lenders......I have no problem with that......
I just want to see the percentage of these loans that are now in default in relationship to the percentage of the so-call "low risk" (in other words rich people) borrowers.
In any case, try selling that BS to the American people......Tell them we need less govt regulation because that's what caused this mess....I can't wait to see McCain's speech on that one!!!!
The way I see....not a penny....let the chips fall where they may...private industry has to take responsibility for their actions.
Is very uneasy
Not this sh!t again.
When given the choice between big business and big government, choose big business. Big business never threw millions of people into gas chambers, but big government did.
"It does not take a majority to prevail, but rather an irate, tireless minority, keen on setting brushfires of freedom in the minds of men" -Samuel Adams
Registered User
It would also be nice to know how many CRA loans have been initiated since 1977 (when the law was passed). Of those loans, how many of them are a part of the current mess?Once again I need some proof.
I'll take everyone's word that private banking was "forced" to make 20% of loans to lower income higher risk lenders......I have no problem with that......
I just want to see the percentage of these loans that are now in default in relationship to the percentage of the so-call "low risk" (in other words rich people) borrowers.
In any case, try selling that BS to the American people......Tell them we need less govt regulation because that's what caused this mess....
The way I see....not a penny....let the chips fall where they may...private industry has to take responsibility for their actions.
Here is some interesting information: http://www.traigerlaw.com/publicatio...udy_1-7-08.pdf
"Our study concludes that CRA Banks were substantially less likely than other lenders
to make the kinds of risky home purchase loans that helped fuel the foreclosure crisis.
Specifically, our analysis shows that:
(1) CRA Banks were significantly less likely than other lenders to make a high cost loan;
(2) The average APR on high cost loans originated by CRA Banks was appreciably lower
than the average APR on high cost loans originated by other lenders;
(3) CRA Banks were more than twice as likely as other lenders to retain originated loans in
their portfolio; and
(4) Foreclosure rates were lower in MSAs with greater concentrations of bank branches."
Last edited by Reality_Check; 09-23-2008 at 11:01 AM.
Is very uneasy
Look who is against the $700 billion bailout. The conservatives!
"I must tell you, there are those in the public debate who have said that we must act now. The last time I heard that, I was on a used-car lot," said Rep. Mike Pence, R-Indiana. "The truth is, every time somebody tells you that you've got to do the deal right now, it usually means they're going to get the better part of the deal."
"They are saying this is failure of the free markets of capitalism when, in fact, this is a failure because government injected itself into the free market, created this easy credit, these guaranteed loans, and these loans are what have turned into the bad paper that are bringing all these financial institutions down," said Sen. Jim DeMint, R-South Carolina.
http://www.cnn.com/2008/POLITICS/09/...eax/index.html
When given the choice between big business and big government, choose big business. Big business never threw millions of people into gas chambers, but big government did.
"It does not take a majority to prevail, but rather an irate, tireless minority, keen on setting brushfires of freedom in the minds of men" -Samuel Adams
Registered User
Tic, Tic,Tic...
Cybernetic Polymath
"Nightmare Scenario in US election:"
http://news.bbc.co.uk/2/hi/americas/7626471.stm
Hrm.
"It is the peculiar quality of a fool to perceive the faults of others and to forget his own." -Cicero
Registered User
President on TV begging for money.....
It's kinda sad but then again the American public has gotten exactly what they asked for.
I have a few dollars in my wallet I think I better go out and spend it before it becomes just fancy green paper.
Registered User
It's kinda sad but then again the American public has gotten exactly what they asked for.
I have a few dollars in my wallet I think I better go out and spend it before it becomes just fancy green paper.
Wow, you'd better flee the country while you still can! Venezuela's not too far. Hurry!
prime rib rocks hard!
Boulderdawg
"I just want to see the percentage of these loans that are now in default in relationship to the percentage of the so-call "low risk" (in other words rich people) borrowers."
I would like to see those numbers too. I believe a lot of upper class people have defaulted too.
Junior Member
There are probably rich people that have defaulted on these loans but the lower class people that have defaulted on thier loans probably shouldn't have been approved in the first place.
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