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The sins of Fannie and Freddie were bad enough: inadequate capital, accounting fraud,...

The sins of Fannie and Freddie were bad enough: inadequate capital, accounting fraud, essentially writing most laws that affected them. But Joe Nocera says the one thing they didn't do was lead the private sector off the cliff with their affordable housing mandates and massive subprime holdings. "The reality is that Fannie and Freddie followed the private sector off the cliff instead of the other way around."
Comments (13)
  • Bret Jensen
    , contributor
    Comments (9838) | Send Message
     
    Amazing the NYTimes sees no govt fault......LOL.
    20 Dec 2011, 05:56 PM Reply Like
  • D_Virginia
    , contributor
    Comments (2280) | Send Message
     
    "No" fault?

     

    What part of "the sins of Fannie and Freddie were bad enough" was unclear to you?

     

    Or, to quote directly from the first line of the article: "There is so much about Fannie Mae and Freddie Mac that we should be angry about."

     

    I think Nocera's point is well-supported by data: the GSEs may have been in on it, and they did plenty of bad, but they were far from the biggest or the most eggregious offenders during the housing "boom" period. It took the private lenders to really take the whole thing to the next level and beyond and then even further still.

     

    And not every article can call out every culpable party in the crisis -- there's not that much space on the internet!! :)
    20 Dec 2011, 06:04 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    From a couple days ago.

     

    http://bit.ly/rOD1aO
    20 Dec 2011, 06:22 PM Reply Like
  • buffettfan50
    , contributor
    Comment (1) | Send Message
     
    Right. I didn't see this story on Fox News, so obviously it must not be true. A clear liberal conspiracy to get us all on food stamps.

     

    Personally, I blame Obama for the creation of Fannie and Freddie, as any good red blooded American should.
    20 Dec 2011, 06:58 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    "Right. I didn't see this story on Fox News, so obviously it must not be true. A clear liberal conspiracy to get us all on food stamps."

     

    heh

     

    Obviously your sarc missed the irony of your statement entirely, that Barack Obama is the most successful food stamps president in living history. He's breaking records at warp speed everyday.
    20 Dec 2011, 08:41 PM Reply Like
  • anonymous#12
    , contributor
    Comments (552) | Send Message
     
    Ah, but what about Congress? Yes, the same guys who pushed and increased pressure on them to lower standards all for the sake of "the dream". What about the president? Bush in 2003 was saying "lower standards is good" for the people.....

     

    The congress utilized moral suasion to accomplish their goals. ....buying votes. if
    you give people the opportunity to be homeowners you win their approvals. Especially minorities groups, and poor people.

     

    But rest assured, the legislators are going to make distractions and enforce these public hearings aka clown shows....

     

    Of course the banking oligarchs all started this with their search for more short term profits....their greed is disgusting, immoral and insatiable.
    20 Dec 2011, 06:04 PM Reply Like
  • WMARKW
    , contributor
    Comments (10252) | Send Message
     
    And GSE's continue(d) to write loans in a falling housing market with 4% down, guaranteeing that any such loan written from 2008 to now would automatically create a "homeowner underwater" situation. Is that intelligent underwriting or policy directive?
    20 Dec 2011, 06:25 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    97% of all mortgages had their training wheels put on by the SOEs.

     

    The private sector looked TO F&F as the market lender of last resort and THEIR guidelines, which in turn, set their own.

     

    http://bit.ly/rVET2m

     

    Government was actually the only problem at that point. There are no other bad actors, period.
    20 Dec 2011, 06:26 PM Reply Like
  • D_Virginia
    , contributor
    Comments (2280) | Send Message
     
    That 97% number is SINCE the crisis, not BEFORE the crisis.

     

    And they buying/guaranteeing of all the banks' bad mortgages was surely a boneheaded move by the government, but F&F didn't originate the majority of those loans, other "bad actors" did.
    20 Dec 2011, 06:42 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    "And they buying/guaranteeing of all the banks' bad mortgages was surely a boneheaded move by the government, but F&F didn't originate the majority of those loans, other "bad actors" did."

     

    I think the question becomes, 'If F&F didn't backstop these F'ing loans, would they have been written?'. The "bad actors" had a no risk situation thanks to F&F and they took advantage of it.
    20 Dec 2011, 08:41 PM Reply Like
  • Leftfield
    , contributor
    Comments (3758) | Send Message
     
    Surprise; government aided, abetted and coerced willing lenders and borrowers who were happy to participate in the early stages of the resultant doomed bubble. Lenders threw out their standards and packaged the mess for FNM and FRE. Managements waxed rich on bonuses and leverage.

     

    This OPM mafia is comprised of both the government, and private sector beneficiaries who have so far succeeded spectacularly in socializing their losses while keeping their "private" gains.
    20 Dec 2011, 06:45 PM Reply Like
  • Hubert Biagi
    , contributor
    Comments (689) | Send Message
     
    The problem began before F&F, before GSEs, before subprime. THe problem began when we change the bill of rights from "life, liberty, and the pursuit of happiness", to "free medical, free houses, and guaranteed benefits for all"...
    20 Dec 2011, 09:59 PM Reply Like
  • Wyatt Junker
    , contributor
    Comments (4503) | Send Message
     
    1913.

     

    Yeah, it was a bad year.

     

    A really bad year.

     

    And that year is still here 98 years later.
    20 Dec 2011, 11:44 PM Reply Like
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