The Rest of the story

> HOW IT REALLY


> HAPPENED AND WHO DID

> IT ! ! !

> !

>

>

> It is mandatory that

> each and

> every one of us learn who committed

> the acts that created the

> mess we

> are currently in.

> 1977: Pres. Jimmy

> Carter signs into Law

> the

> Community Reinvestment Act the foundation and

> cornerstone for the

> impending disaster.. The law pressured

> financial institutions to

> extend home loans to those who would otherwise

> not

> qualify.

> The publicized

> premise: Home

> ownership would improve poor and crime-ridden

> communities and

> neighborhoods in terms of crime, investment,

> jobs,

> etc.

> The Results:

> Statistics bear out that it did not

> help.

> How did the

> government get

> so deeply involved in the housing

> market?

> Answer: Bill

> Clinton wanted it that

>

> way.

> 1992: Republican

> representative Jim Leach (IO) warned of the

> danger that Fannie and

> Freddie were changing from being agencies of

> the public at large to

> money machines for the principals and the

> stock-holding

> few.

> 1993: Clinton extensively

> rewrote

> Fannie Mae and Freddie Mac's rules turning

> the quasi-private

> mortgage-funding firms into semi-nationalized

> monopolies dispensing

> cash and loans to large Democratic voting

> blocks and handing favors,

> jobs and contributions to political

> allies. This potent mix

> led inevitably to corruption and now the

> collapse of Freddie and

> Fannie.

> 1994: Despite

> warnings, Clinton unveiled his

> National

> Home-Ownership Strategy, which broadened the

> CRA in ways congress

> never intended.

> 1995: Congress, about to change

> from

> a Democrat majority to

> Republican. Clinton orders Robert

> Rubin's Treasury Dept

> to

> rewrite the rules. Robt. Rubin's

> Treasury reworked rules,

> forcing banks to satisfy quotas for sub-prime

> and minority loans to

> get a satisfactory CRA rating. The rating

> was key to expansion

> or mergers for banks. Loans began to be

> made on the basis of

> race and little else.

> 1997 -

> 1999: Clinton, bypassing

> Republicans in

> Congress,

> enlisted Andrew

> Cuomo,

> then Secretary of Housing and Urban Dev

> elopement, allowing Freddie

> and Fannie to get into the sub-prime market in

> a BIG way. Led

> by Rep. Barney Frank and

> Sen. Chris

> Dodd, congress doubled

> down on the

> risk by easing capital limits and allowing them

> to hold just 2.5% of

> capital to back their investments vs. 10% for

> banks. Since

> they could borrow at lower rates than banks

> their enterprises

> boomed.

> With incentives in

> place,

> banks poured billions in loans into poor

> communities, often "no

> doc", "no income",

> "no assets", requiring no money down,

> no verification of income, no nothing .

> Worse still was the

> cronyism: Fannie and Freddie became home

> to out-of

>

> work-politicians, mostly Clinton Democrats. 384

> politicians got

> big campaign donations from Fannie and

> Freddie. Over $200

> million had been spent on lobbying and

> political activities.

> During the 1990's Fannie and Freddie

> enjoyed a subsidy of as much as

> $182 Billion, most of it going to principals

> and shareholders, not

> poor borrowers as

> claimed.

> Did it work?

> Minorities made up 49% of the 12.5 million new

> homeowners but many

> of those loans have gone bad and the minority

> home ownership rates

> are shrinking fast.

> 1999: New Treasury

> Secretary, Lawrence Summers, became alarmed at

> Fannie and Freddie's

> excesses. Congress held hearings the

> ensuing year but nothing

> was done because Fannie and Freddie had donated

> millions to key

> congressmen and radical groups, ensuring no

> meaningful changes would

> take place. "We manage our political

> risk with the same

> intensity that we manage our credit and

> interest rate risks," Fannie

> CEO Franklin Raines, a

> former Clinton official and current

> Barack

> Obama advisor, bragged to

> investors in

> 1999.

> 2000:

> Secretary

> Summers sent Undersecretary Gary Gensler to

> Congress seeking an end

> to the "special status".

> Democrats raised a ruckus as did

> Fannie and Freddie, headed by politically

> connected CEO's who knew

> how to reward and punish. "We think

> that the statements

> evidence a contempt for the nation's

> housing and mortgage markets"

> Freddie spokesperson Sharon McHale said.

> It was the last

> chance during the Clinton era for

> reform.

> 2001:

> Republicans try repeatedly to bring fiscal

> sanity to Fannie and

> Freddie but Democratsblocked any attempt at

> reform;

> especially Rep. Barney Frank and

> Sen. Chris

> Dodd who now run key

> banking

> committees and were huge beneficiaries of

> campaign contributions

> from the mortgage

> giants.

> 2003: Bush proposes

> what

> the NY Times called "the most significant

> regulatory overhaul in the

> housing finance industry since the savings and

> loan crisis a decade

> ago". Even after discovering a

> scheme by Fannie and Freddie to

> overstate earnings by $10.6 billion to boost

> their bonuses, the

> Democrats killed

> reform.

> 2005: Then Fed

> chairman

> Alan Greenspan warns Congress: "We

> are placing the total

> financial system at substantial

> risk". Sen. McCain, with two

> others, sponsored a Fannie/Freddie reform bill

> and said, "If

> congress does not act, American taxpayers will

> continue to be

> exposed to the enormous risk that Fannie Mae

> and Freddie Mac pose to

> the housing market, the overall financial

> system and the economy as

> a

> whole". Sen. Harry

> Reid accused the

> GOP of

> trying to "cripple the ability of Fannie

> and Freddie to carry out

> their mission of expanding home

> ownership" The bill went

> nowhere.

> 2007: By now Fannie

> and

> Freddie own or guarantee over HALF of the $12

> trillion US mortgage

> market. The mortgage giants, whose

> executive suites were

> top-heavy with former Democratic officials, had

> been working with

> Wall St. to repackage the bad loans and sell

> them to

> investors. As the housing market fell in

> '07, subprime

> mortgage portfolios suffered major

> losses. The crisis was

> on, though it was 15 years in the

> making.

> 2008: McCain has

> repeatedly

> called for reforming the behemoths, and

> Bush urged reform 17

> times. Still the media have repeated

> Democrats' talking points

> about this being a "Republican"

> disaster. A few Republicans

> are complicit

> but Fannie and Freddie were

> created

> by Democrats, regulated by Democrats, largely

> run by Democrats and

> protected by

> Democrats. That's

> why taxpayers

> are now being asked for $700

> billion!!

> If you doubt any of this,

> just

> click the links below and listen to your

> lawmakers' own words.

> Decide for yourself.

> http://www.youtube.com/watch?v=68D9XrqyrWo&feature=related #

> http://www.youtube.com/watch?v=pIgqfM5C8lY#

> http://www.youtube.com/watch?v=H9j=

>

>

> uJr8CSY4&feature=related #

> Postscript:

> ACORN is

> one of the principlal beneficiaries of Fannie/

> Freddie's slush

> funds. They are currently under

> indictment or investigation in

> many states. Barack Obama served as their

> legal counsel,

> defending their activities for several

> years. Last year the

> democratic congress gave ACORN $500 million and

> attempted to sneak

> in $20 BILLION (Yes BILLION) into the first

> version of the bailout.

> That's why Republicans voted

> no.

>