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The Root Cause of the Current Economic Crisis
Began in 1999
Sept 1999 - In
a move that could help increase home ownership rates among minorities and
low-income consumers, the Fannie Mae Corporation is easing the credit
requirements on loans that it will purchase from banks and other lenders.
The action, which will begin as a pilot program involving 24 banks in 15
markets - including the New York metropolitan region - will encourage
those banks to extend home mortgages to individuals whose credit is
generally not good enough to qualify for conventional loans. Fannie Mae
officials say they hope to make it a nationwide program by next spring.
Fannie Mae, the nation's biggest underwriter of home mortgages, has been
under increasing pressure from the Clinton Administration to expand
mortgage loans among low and moderate income people and felt pressure
from stock holders to maintain its phenomenal growth in profits.
In moving into this new area of lending, Fannie Mae is taking on
significantly more risk. The government subsidized corporation may run into
trouble in an economic downturn, prompting a government rescue similar to
that of the savings and loan industry in the 1980's.
Peter Wallison a resident fellow at the American Enterprise Institute. ''If
they fail, the government will have to step up and bail them out the way
it stepped up and bailed out the thrift industry.''
By expanding the type of loans that it will buy, Fannie Mae is hoping to
force banks to make more loans to people with less-than-stellar credit
ratings. Fannie Mae said the move is intended to increase the number of
minority and low income home owners who tend to have worse credit ratings
than non-Hispanic whites.
Home ownership rates for minorities continue to lag behind non-Hispanic
whites, in part because blacks and Hispanics in particular tend to have on
average worse credit ratings.
--------------------------------------------------------------------------------------------------------------------------------
 Barney Frank
Tries to Twist
his Statements on Fannie Mae and Freddie Mac Government Mortgages
on July
14th 2008, Barney Frank said, "I think this is a case where Fannie and
Freddie are fundamentally sound but they are not in danger of going
under...they're not the best investments these days from the long term
standpoint coming back I think they're in good shape going forward. They're
in the housing market and I do think the prospects going forward are very
solid and in fact we're going to do some things to improve them."
Fox News Video
Many taxpayers wonder about the Facts Behind the Financial
Turmoil?” Ask Barney Frank
The true source of the financial meltdown in the home mortgage industry that led to the
collapse of Fannie Mae and Freddie Mac Financial
Crisis Bailout
9-29-2008 The Majority of Republicans Vote NO on Democrat Financial Bailout Plan.
Democrat Leader Barney Frank verbally bends Republicans over a barrel for a
Tongue Lashing.
10-3-2008 Congress passes financial bailout
with added pork of 180 Billion to switch previous NO votes.
Bush and Democrats promise Americans a never-ending nightmare of ever-greater debt
liabilities. Republicans defy Bush. Financial
Great Depression
2004 News Archives
- Hearing to investigate Illegal
Book keeping at Fannie Mae and Freddie Mac. Democrats cover up and attack regulations to
protect their lobby money
Video News
Financial Crisis Wall Street 9/24/2008
-The House of Representatives approved a 25 Billion Dollar package of low cost loans to
help carmakers and their suppliers. The loans are separate from the proposed 700 Billion
Dollar bail out for the banking sector, which is being debated in Congress. General
Motors, Ford and Chrysler lobbied hard for the loans.
Also, the Government may be on the
hook for uninsured deposits of 2.6 Trillion Dollars 150
Billion Dollars Needed Now
The majority of Republicans view the bailout as unjustifiable government interference in
the markets. McCain ready to tackle negotiations while Obama says he can juggle that and
other issues all at once. Bush's speech on the bailout goes into the Wall Street trash
can. Presidents have limited power. Time to focus on the real cancer - the Congress and
Senate - they have the real power over the economy. They wrote and approved the bills to
protect their lobby friends and caused the current debacle.
Senate Majority Leader Harry Reid Takes Lobby Money to Deny
Public Welfare Dirty Harry
News Article from 2008 - The legislative, executive and judicial branches of the U.S.
government grabbed powers denied by the Constitution.
Monetary News
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