Andrew Cuomo Admits Forcing Banks to Make Affirmative Action (Subprime) Loans in 1998
The Subprime Mortgage Crises was mostly caused by government.
President Bill Clinton directed HUD Secretary Andrew Cuomo and Attorney General Janet Reno in charge of using regulatory enforcement under the Community Reinvestment Act to force banks to give loans to minorities and run down communities in spite of the risk. Thus imposing Affirmative Action Lending on the banks.
The Clinton Administration then engineered it so that Government-sponsored enterprises (GSE) Fannie Mae and Freddie Mac would buy most of these high risk sub prime loans.
While the Bush Administration favored more home ownership, the mortgage watchdog agency, the Office of Federal Housing Enterprise Oversight (OFHEO), warned that the system was about to collapse due to people not being able to pay the ridiculous terms on subprime loans.
On numerous occasions the Bush Administration pushed reforms in Congress. Democrats in Congress obstructed and refused to allow GSE reform, going so far as to claim that there was no problem and accusing OFHEO of being racist.
Some banks, as well as Fannie Mae and Freddie Mac, bundled toxic assets (the high risk loans) as securities and sold them on Wall Street to help offset their losses. Other financial institutions sold insurance on those toxic assets to partially cover the owners from loss.
When the housing market crashed it took the stock market with it and the economy of this country is still suffering to this day.
The Bush & Obama Administrations bailed out the banks with taxpayer dollars, but the millions who lost their jobs, their homes etc were left to twist in the wind.
http://hotair.com/archives/2008/10/10/video-subprime-loans-affirmative-action-andrew-cuomo/
http://www.realclearpolitics.com/articles/2016/05/28/is_clinton_the_real_housing_crash_villain_130707.html
MM
President Bill Clinton directed HUD Secretary Andrew Cuomo and Attorney General Janet Reno in charge of using regulatory enforcement under the Community Reinvestment Act to force banks to give loans to minorities and run down communities in spite of the risk. Thus imposing Affirmative Action Lending on the banks.
The Clinton Administration then engineered it so that Government-sponsored enterprises (GSE) Fannie Mae and Freddie Mac would buy most of these high risk sub prime loans.
While the Bush Administration favored more home ownership, the mortgage watchdog agency, the Office of Federal Housing Enterprise Oversight (OFHEO), warned that the system was about to collapse due to people not being able to pay the ridiculous terms on subprime loans.
On numerous occasions the Bush Administration pushed reforms in Congress. Democrats in Congress obstructed and refused to allow GSE reform, going so far as to claim that there was no problem and accusing OFHEO of being racist.
Some banks, as well as Fannie Mae and Freddie Mac, bundled toxic assets (the high risk loans) as securities and sold them on Wall Street to help offset their losses. Other financial institutions sold insurance on those toxic assets to partially cover the owners from loss.
When the housing market crashed it took the stock market with it and the economy of this country is still suffering to this day.
The Bush & Obama Administrations bailed out the banks with taxpayer dollars, but the millions who lost their jobs, their homes etc were left to twist in the wind.
http://hotair.com/archives/2008/10/10/video-subprime-loans-affirmative-action-andrew-cuomo/
http://www.realclearpolitics.com/articles/2016/05/28/is_clinton_the_real_housing_crash_villain_130707.html
MM