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More Blog Posts by Ross Kaminsky
http://spectator.org/blog/2012/02/13/obamas-fatal-conceit
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FLASHBACK TO: 1995
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Pope Culture
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Why the GOP Does Not, Like, Totally Suck
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
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The Metaphysical Martini
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Counting the Costs of Clintonism
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W| 2.13.12 @ 10:30AM
At every real estate closing you have to sign the loan documents that state the interest rate, the monthly payment, and how much interest you will pay over the term of the loan. Then you have to sign a document stating you received the first document about the loan terms. So now we will have more documents to sign.
I don't know what is the problem. For example, the mortgage will say you have to pay $1000 per month. So you have to ask yourself, can I afford $1000 per month to pay the mortgage? And the bank should see your income tax returns to verify your income, and a credit report that shows your debts and payment history.
What is complicated about this? You should know if you can afford the monthly payment without the government telling you that you can afford it.
Bob Miller| 2.13.12 @ 11:03AM
There should be a voters' bill of rights to protect the voting process from the Holder's Justice Department, the thugs it tolerates near the polls, and the other thugs who create or destroy ballots after voting ends..
Reid Smith| 2.13.12 @ 11:12AM
Congratulations on an awesome response!
Clint| 2.13.12 @ 11:19AM
RENT !
Occam's Tool| 2.13.12 @ 5:13PM
I like owning my home. Of course, Clint, you are persona non grata there.
Clint| 2.13.12 @ 5:20PM
Apparently, Screwball Israel Firster Maniac, Tool Job Thinks He Owns The Minnesota Institute For The Criminally Insane.
DRed| 2.13.12 @ 11:25AM
He bemoans loans “sold” to those “who bought a house they couldn’t afford,” but doesn’t point out that it was Congress, Fannie Mae, and Freddie Mac who routinely required lower lending standards and threatened banks which didn’t make homeownership more available to “underserved communities.”
You know Freddie Mac and Fannie Mae don't make loans, right Ross? I'm also not sure how they threatened banks, seeing how they have no authority over banks. Perhaps after you get done explaining that to me, you can tell me how many loans these banks were forced to make and to which undeserving communities they were made. Then you can tell me how those loans performed. To cause the housing crisis, there must have been a huge number of loans, and they must have performed terribly. I'm sure you should have no problem providing those statistics. Or you can just repeat your lies about how it was all the fault of the government.
Bob K.| 2.13.12 @ 12:21PM
Nonsense!
This was going on well before 2010 in a time when Democrats controlled the purse strings in Congress and passed laws that made it possible.
And the same Congresses held hearings to bully the banks into making these loans and gave to
their political buddies running Freddie Mac and Fannie Mae big bucks to see that the banks were able to comply.
And Obama voted for all this during the time he was a member of these congresses.
Ross Kaminsky | 2.13.12 @ 12:41PM
DRed,
Did I say anywhere that Fannie and Freddie made the initial loans?
Here is just one article on threats made to banks:
http://iusbvision.wordpress.co.....bad-loans/
And another, which makes clear the government threatening to direct FNM and FRE to retaliate against banks:
http://commonsensewonder.blogs.....banks.html
DRed| 2.13.12 @ 1:25PM
Your first article is talking about the CRA. Most of the subprime loans issued in the period leading up to the housing crisis were made by non-bank lenders that weren't covered by the CRA. Can you explain how the CRA forced institutions that weren't subject to CRA legislation to do anything?
Your second article seems to imply that it was loans to poor minorities that caused the housing crisis. Is that what you're trying to say? (if you say yes, by the way, I'm not going to call you racist-don't worry)
Clint| 2.13.12 @ 2:37PM
The Clinton Administration 1995 Revisions To The CRA, Orchestrated By Then Treasury Secretary Lloyd Bentsen And Clinton Economic Advisor Robert Rubin, Opened The Securitization Of Sub-Prime B-Paper.
Ross Kaminsky | 2.13.12 @ 4:48PM
DRed,
You're being intentionally obtuse.
The point is that government regulators leaned on banks, with various sorts of threats, if they didn't make loans that rational bankers wouldn't make.
I'm not saying this is the only or even the most important factor in the housing crisis. It's just another demonstration of why we need to get government out of our economy to the greatest extent possible.
DRed| 2.13.12 @ 5:36PM
Ross, you'll have to excuse my obtuseness. When I read an article concluding with "[g]overnment was the primary cause of the housing crisis" I assume the author thinks that government was the primary cause of the housing crisis. Your argument, as I understand that, is that because government meddling in the housing market caused the mortgage crises, the government should get out and let the market clear up the mess. But you can't show that the government caused the mortgage collapse of the housing market.
Occam's Tool| 2.13.12 @ 5:14PM
It was loans to buyers who were not good credit risks.
DRed| 2.13.12 @ 5:37PM
That was part of it, Occam, absolutely. But the government wasn't forcing countrywide to offer no money down mortgages to people with terrible credit.
Occam's Tool| 2.13.12 @ 5:10PM
I dunno. I moved to a place where my house cost less than my yearly salary, and now I have refinanced and will be done in about 9 years. My wife the accountant would have killed me if I was not cautious.
The cost of housing was why I left SoCal.
Clint| 2.13.12 @ 12:45PM
" Under the CRA, if a bank wants to make virtually any change in its business operations — merging, opening up a new branch, getting into a new line of business — it must first prove to regulators that it has made "enough" loans to the government's preferred borrowers. The (partially) tax-funded "community groups" like ACORN (Association of Community Organizations for Reform Now) can file petitions with regulators that stop the bank's activities in their tracks, perhaps defeating them altogether. The banks routinely buy off ACORN and other "community groups" by giving them millions of dollars as well as promising to make even more dubious loans.
In order to try to diversify the risk of these loans, the Federal Home Loan Mortgage Company ("Freddie Mac") pioneered the "securitization" of bundles of these high-risk loans so that they could be sold on secondary markets. Such "securitization" exploded during the 1990s as a result of government regulation. As Fed Chairman Ben Bernanke himself stated in a March 30, 2007 speech entitled "The Community Reinvestment Act: Its Evolution and New Challenges" (published online by the Fed),
Securitization of affordable housing loans expanded, as did the secondary market for these loans, in part reflecting a 1992 law that required the government-sponsored enterprises, Fannie Mae and Freddie Mac, to devote a large percentage of their activities to meeting affordable housing goals. (p. 3)"
Vern Crisler| 2.13.12 @ 12:15PM
Excellent article. If Romney ever hopes to energize the base, I suggest he should begin every speech from now on with something like what Ross wrote:
'The great Austrian economist F.A. Hayek called it the “fatal conceit”: The idea that man, through the power of government, can “shape the world around him according to his wishes.” This arrogance has been the foundation of the Progressive movement for more than a century.'
Lesser Weevil| 2.13.12 @ 12:41PM
If only.
1ConservativeUSA| 2.13.12 @ 12:30PM
Well done, Mr. Kaminsky.
Lesser Weevil| 2.13.12 @ 12:48PM
The "constitutional scholar" sure has an odd view of what a bill of rights is. A bunch of new authoritarian regulations bossing around one group of citizens allegedly to shower favors on another group isn't exactly what the Founders had in mind.
JimH| 2.13.12 @ 1:21PM
Are there any statistics on currently underwater mortgage holders who had flipped one or more properties prior to the bubble bursting. I don’t have much sympathy for those people. Have any banks considered redoing underwater loans to market value with the proviso that any gain realized when the property is sold is split between the bank and the home owner. Doing this, the banks are initially writing off part of the initial loan, but it is in effect a mark to market. Banks do not want to foreclose on people and they do not want to have to hold foreclosed homes.
Dai Alanye | 2.13.12 @ 2:38PM
If only Obama could travel back in time to save investors from the South Sea Bubble and the Tulip Mania.