Comments on Rob K. Blake's articles RSS Syndication from SeekingAlpha.com http://seekingalpha.com/author/rob-k-blake/articles http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-532803 532803 Thu, 04 Jun 2009 20:07:02 -0400 bloggingstocker.blogsp...]]> http://seekingalpha.com/article/66631-jumbo-mortgage-risk-will-topple-the-teetering-gses?source=feed#comment-216801 216801 Mon, 28 Jul 2008 16:33:03 -0400 http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-213613 213613 Thu, 24 Jul 2008 14:04:37 -0400 http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212860 212860 Wed, 23 Jul 2008 21:46:53 -0400
yes i would. savings were rewarded and borrowing was penalized...a normal and healthy reationship unless you're a nation accustomed to its citizens consuming beyond what they can afford to pay for.

today's problems didn't simply occur because of loans made to deadbeats. that would barely register as a blip on the radar screen. absurdly low interest rates, scam mortgages with teaser rates, overleverage by borrowers both rich and poor, securitization run amok, incompetent rating agencies and regulators asleep at the switch had just a tad to do with it too, don't you think?

"If we let Fannie and Freddie fail home ownership in this country will plummet and we will be in a sever depression. Home values will plummet, equities will plummet. This moral high road thing is ridiculous. I am happy for our govt to pay 25B - 100B to bail these guys out instead of it costing the entire economy trillions upon trillions."

spoken like a true socialist who has nothing...therefore nothing to lose. ]]> http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212845 212845 Wed, 23 Jul 2008 21:27:12 -0400
It's going to cost trillions and trillions anyway.

Think about it. You can't magically create value out of thin air. If the market says a house isn't worth 500,000$, then it's not worth 500,000$. Having the government bail (some) banks out by, say, guaranteeing the extra 200,000$ on that house which is now valued at 300,000$ still cost society 200,000$, regardless if the bank or the government pays it.

All that Paulson is doing is trying to shift the damage so it hits as many people as possible so the total burden loss on each individual and institution is not as great. The cost will still show up, whether it bank losses, homeowners stuck barely paying the interest on their loans for years, or just plain folks who cannot afford to buy a home right now, and who will be priced out as long as the government tres to prop up house prices in this manner.]]> http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212584 212584 Wed, 23 Jul 2008 14:44:04 -0400 http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212495 212495 Wed, 23 Jul 2008 12:56:40 -0400
Wake up my friends and ask yourselve's whether you'd like to return to the S & L debacle of thirty years ago where private financial institutions were dialing for dollars in CD's at 16% interest rates while loaning money at 6% creating imbalanced sheets and a failing industry!!]]> http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212490 212490 Wed, 23 Jul 2008 12:54:11 -0400 http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212412 212412 Wed, 23 Jul 2008 11:35:50 -0400 http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212349 212349 Wed, 23 Jul 2008 10:42:43 -0400 http://seekingalpha.com/article/86473-let-the-gses-fail?source=feed#comment-212348 212348 Wed, 23 Jul 2008 10:40:58 -0400 http://seekingalpha.com/article/85910-is-the-texas-ratio-a-predictor-of-bank-failure?source=feed#comment-212058 212058 Wed, 23 Jul 2008 01:38:57 -0400 No thanks, Mr. Blake.]]> http://seekingalpha.com/article/76380-fannie-mae-and-freddie-mac-on-the-brink?source=feed#comment-164457 164457 Thu, 08 May 2008 18:28:11 -0400 http://seekingalpha.com/article/76380-fannie-mae-and-freddie-mac-on-the-brink?source=feed#comment-164368 164368 Thu, 08 May 2008 16:16:25 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-153507 153507 Sat, 19 Apr 2008 19:13:55 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-151893 151893 Wed, 16 Apr 2008 17:50:33 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-149361 149361 Sat, 12 Apr 2008 00:43:00 -0400
That said most of what people can't stand are the...the back alley deals....scaming investors....using mutual fund money to fund outrageous IPO's.....self dealing CEO's with a hand picked recipicated board of directors....lyers, theives, and monopolist.

None of those things have anything to do with a free market. They are thieves and should be tried in the criminal and civil court systems. No need for regulations just put these white collar crooks in jail and throw away the key. Do the same to the politicians who give them pardons for campaign donations like clinton did. Heck Bush will probably do the same right before he leaves office too.

Regulation is not what we need. Regulation just places more power in the hands of the crooks. The line of seperation between wall street crooks and our REGULATING politicians is almost zero. They will regulate to themselve more stolen money. Then when it all crashes down they will retire to their mansions and bail out their own businesses with the MIDDLE class taxpayer money. The poor will vote for them for the peanut shells the rich toss down to them.

Cynical in Florida,

John]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-149199 149199 Fri, 11 Apr 2008 16:10:06 -0400
Regulating lenders (the CRA scoring system) is what started this whole mess.

And all the obfuscation only adds to the problem. ]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-149116 149116 Fri, 11 Apr 2008 14:05:10 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148995 148995 Fri, 11 Apr 2008 11:24:12 -0400
"Heaven forfends trees from growing to the sky"]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148936 148936 Fri, 11 Apr 2008 10:14:53 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148879 148879 Fri, 11 Apr 2008 09:11:08 -0400
Re that ass Kudlow, he loves to crow about the wonders of free markets--until Wall Street needs a handout. Suddenly, then, the markets need the Fed to act like a wealthy uncle to underwrite sonny boy's latest misadventure. Free markets indeed!]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148738 148738 Fri, 11 Apr 2008 01:14:00 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148606 148606 Thu, 10 Apr 2008 19:05:01 -0400
The CRA mandates that each banking institution be evaluated to determine if it has met the credit needs of its entire community. That record is taken into account when the federal government considers an institution's application for deposit facilities, including mergers and acquisitions.

This is what rocketed the crisis wildly:

In 1995, as a result of interest from President Clinton's administration, the implementing regulations for the CRA were strengthened by focusing the financial regulators' attention on institutions' performance in helping to meet community credit needs. These changes were very controversial and as a result, the regulators agreed to revisit the rule after it had been fully implemented for five years. The revisions allowed the securitization of CRA loans containing subprime mortgages. The first public securitization of CRA loans started in 1997.

As Stan Liebowitz, a University of Texas economist, has pointed out, a Fannie Mae Foundation report enthusiastically singled out one mortgage lender that followed "the most flexible underwriting criteria permitted." That lender's loans to low-income people had grown to $600 billion by 2003. Its name? Countrywide, the largest U.S. mortgage lender and one of the lenders in the most trouble for its lax lending practices.

The rest is history.

Banks were forced to loan money to borrowers they never would have, had government regulation not forced them to. Then, additional government regulation allowed Wall Street to package the loans that never should have been made into negotiable securities and sold, and resold. This made these high risk securities backed by the loans that never should have been made in the first place popular with the hedge funds and investment banks worldwide - because they had a high yield. This created tremendous demand back down the pipe for more of these securities, which accelerated even further the building of homes that never should have been built, and sold to buyers who could not afford, nor had the ability to borrow, which overbuilt the entire housing market and deflated the value of all houses. The genesis of the entire mess is GOVERNMENT wrongly demanding a solution to so-called “affordable housing”, adopting the attitude that Banks were racist for "wink & nod" redlining, then ordering banks to loan money to people NOT based upon credit standards that protected the bank. It was in the mid-1990s when our vaunted statesmen decided the CRA - the Community Reinvestment Act (nice name, kinda like the Patriot Act) allowed CRA loans to be "securitized", or allowed Wall Street to slice and dice the loans so that they would be popular with institutional investors, resulting in more money available to loan money to people who never should have borrowed in the first place.

Rescind the CRA and its authority to allow the securitization of loans made as a result of its passage.
]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148555 148555 Thu, 10 Apr 2008 17:08:50 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148501 148501 Thu, 10 Apr 2008 15:57:52 -0400

]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148477 148477 Thu, 10 Apr 2008 15:29:02 -0400 2.I don't indulge in Dem vs. Rep - after the ethanol bill and now the "keep the builders happy bill" I share the viewpoint of a friend who asked "How could 535 people be so collectively stupid?"
3. Mortage brokers were going gangbusters in 2002;Wall St. merely poured gasoline on the fire - and the banks and mortgage guarantee agencies had already abdicated quality discipline. Certainly no one expected Wall St. to do anything but push deteriorating ethics and business practices downhill; that's what they seem trained to do.
4.This took crooks at every level, wink-wink at every level (Confucius or someone said "when 2 men wink, both men are blind." Banks were so anxious to cut costs and merge they had inadequate loan departments who I am sure were egged on into approvals. I'm also sure some bank officer said, "If you do this for a CRA loan, why not for a 750,000 up-and-comer?" That doesn't make CRA the cause.
5.We have to have regulation because $$$ have run over ethics and responsibility,not because of socialism or freemarkets. Under the socialism that Larry fears, everyone cheats to survive;under free markets as practiced today, some cheat but they get great leverage. ]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148373 148373 Thu, 10 Apr 2008 13:10:20 -0400 Capitalists are great people - they are the people who make things happen - they create the wealth of the nation BUT they need to be regulated or they will tear the country apart in their greed.

see - novan.com/capitlist.htm]]> http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148372 148372 Thu, 10 Apr 2008 13:07:47 -0400 http://seekingalpha.com/article/71775-larry-kudlow-is-dead-wrong-cra-didn-t-start-the-meltdown?source=feed#comment-148303 148303 Thu, 10 Apr 2008 11:30:30 -0400