How did we get into this situation in the first place?

[Meadmaker]

Aaron Pressman, a writer for Business Week and Bloomberg, among others, has some thoughts on the theory from the OP:


http://www.businessweek.com/investing/insights/blog/archives/2008/09/community_reinv.html

He doesn't seem to think that the community reinvestment act or the efforts of civil rights lawyers played a significant role in this crisis.

 

[Dymanic]

Aaron Pressman, a writer for Business Week and Bloomberg, among others, has some thoughts on the theory from the OP:


http://www.businessweek.com/investing/insights/blog/archives/2008/09/community_reinv.html

He doesn't seem to think that the community reinvestment act or the efforts of civil rights lawyers played a significant role in this crisis.

I wondered why BAC, who had seemed so eager to discuss details, suddenly fell silent when encouraged to provide evidence that CRA-regulated loans were more likely to end in foreclosure. It now looks as though one possible explanation is that BAC reached the same conclusion as the authors of the study linked in that article:

"Our study concludes that CRA Banks were substantially less likely than other lenders to make the kinds of risky home purchase loans that helped fuel the foreclosure crisis."

 

[BeAChooser]

Snivelling about the end of red-lining is, at its core, racist.

So, lefty ... is Larry Elder a racist? Because here are his words:

http://www.reason.com/news/show/29891.html

Reason: So you don't think there is redlining in real estate and bank loans?

Elder: It's crap, nonsense. Does redlining exist in the sense that there are certain geographical areas where insurers are less likely to insure, or people are less likely to live or invest in? Yeah, but there are also economic reasons for that. When you burn down your neighborhood, that's going to make insurance companies a little skittish. When [Rep.] Maxine Waters [D-Calif.], having witnessed a conflagration, refers to it as an "uprising" or "rebellion," rather than as a riot, and I'm in an insurance company and I'm listening to this, I'm a little concerned.

http://74.125.45.104/search?q=cache...rry+elder+redlining&hl=en&ct=clnk&cd=38&gl=us

But the overall theme on the part of somebody like Jesse Jackson, Al Sharpton, Maxine Waters, is that if you can't get a loan at the bank, it is obviously because a racist lender refused to give you the money. If you live in an area where there is a lot of violence and a lot of crime and you can't get insurance, obviously, you are a victim of racist redlining.

If your kid doesn't do well on the SAT, well, the problem is not your kid and your kid's refusal to work harder and your refusal to put more pressure on the kid to work harder and the crappy school the kid goes to, it's because racist examiners decided to culturally bias tests. What does this say? It says that people like that are willing to accept the worst possible motive in the minds and hearts of white people; that white people really get up in the morning and want to oppress black people. Now, that is something that we call in the black community "racial profiling." And it is as offensive as when it is done to black people.

http://townhall.com/columnists/LarryElder/2008/05/01/the_wright_cost_of_anger

Here's the "victicrat" mindset: Kids having difficulty performing well on standardized tests? Blame "cultural bias." Get pulled over by a cop? DWB -- driving while black. A disproportionate number of blacks in prison? A racist criminal justice system that "targets" blacks for prosecution and imprisonment. Katrina? As Rep. Barney Frank, D-Mass., put it, "ethnic cleansing by inaction." Difficulty qualifying for a loan? Blame banks' devious plan to prevent blacks from getting "access to capital." Pay more for car insurance because you live in a high-crime neighborhood? Why, illegal "redlining," of course. High inner-city dropout rate? Bad teachers, unequal funding, racist teachers -- yada, blah, etc.

You a victicrat, lefty?

 

[BeAChooser]

I have to conclude that this wasn't something the GOP Congressional leadership wanted all that much. They had the power to at least force a vote on their own version of the bill.

Did they? You do know what a filibuster is, don't you?

But regardless, my thesis stands. Obama still LIED when he claimed McCain and Bush had done nothing to prevent or warn against trouble in the mortgage area. Is he a liar, Meadmaker? Can we at least agree on that ... since Bush lying seems to have been a big theme of democrats the last 8 years (although curiously it wasn't the previous 8 when the biggest liar of all inhabited the WhiteHouse).

I have to go back to my original conclusion. Republicans were in charge and could have done something about it, but didn't.

You've admitted that the vote in the committee was along party lines. Does that show ANY willingness on the part of democrats to compromise? ANY willingness to want to fix the problem that an investigation had exposed? There is only so much political capital to spend, MM. Sure, republicans could have beat their heads against a wall and tried to force a vote ... and failed. And how would the liberal media have played that? They'd have filled the airways with discussion of how cruel, uncaring and racist republicans were while quoting the statements of leading democrats (like I did above) to the max. Maybe that's what democrats wanted?

As previously noted, Senator McCain does deserve credit. He did try

Good. Then you'll agree that Obama LIED when he said this?

Senator McCain's approach was the same as the Bush administrations ... support ideological policies that made the crisis more likely, do nothing as the crisis hits, and then scramble as the whole thing unravels. Now, my approach has been to prevent ... to try to prevent this turmoil from occurring in the first place. In February of 2006, I introduced legislation to stop mortgage transactions that promoted fraud, risk or abuse. A year later, before the crisis hit, I warned Secretary Paulson at the Treasury and Chairman Bernanke at the FED about the risks of mounting foreclosures and urged them to bring together all the staples to find solutions to the sub-prime mortgage meltdown. Senator McCain did nothing."

Meanwhile, the idea that the collapsing real estate bubble was caused by forcing banks to lend to those people represented by civil rights lawyers is a bunch of codswallop.

I'll stand by the quotes and links I've supplied on this thread. What are you standing by? Maxine Waters statement?

 

[BeAChooser]

I've never considered mined quotes to be quite the strongest form of evidence

Dymanic, do you think any of us do anything on this forum other than "mine quotes". The rules of JREF in fact prohibit anything else. But at least *I* am offering quotes and links to those quotes (so you can assure yourself that they aren't so much mined but summarize facts or a view) ... unlike so many others on this thread who merely handwave or claim to have heard things around the "watercooler". At least in my case you can assure yourself that I didn't take the quotes completely out of context as I proved Obama did many times in his speeches. Now there's a "quote miner" for you to criticize.

but I'd be willing to concede that Democrats are, in general, perhaps more inclined toward social engineering than are Republicans -- if you'd concede that they are no more interested in political power than are Republicans.

Not so fast. Just take the example of President Bush, who democrats have vilified in the vilest of terms the past 8 years. If he was just as interested in political power as democrats, then he wouldn't have carried through with the Iraq invasion and certainly wouldn't have stayed the course in Iraq through the dark years when things weren't looking great and the majority in polls were for cutting and running. There's an example where a Republican put doing what was RIGHT over party and his own self interest. Be honest ... half the votes democrats will get in this election are because of the war. And Bush has held plenty of positions on social issues that are on the whole unpopular with the public ... at least if you believe what the liberal leaning mainstream media claim. Again, he put what he believes is the right thing to do over party and mere "political power".

Interestingly enough, putting Right over Party was a major theme in McCain's acceptance speech. Do you suppose he might be on to something as opposed to Obama's acceptance speech which was more about continuing the agendas and approaches that got us into this financial mess than anything else?

And this is a case where democrats have championed "social engineering" to garner political power. Beggars and Choosers. They pandered to certain groups ... offered them freebies ... just to increase their political power. And ignored all warnings that what they were doing would ultimately collapse and hurt the country. Now I'm not suggesting that republicans didn't do any of that but they sure did a lot less.

I'm not really attempting to "show" anything here. I'm just asking questions. But if it turns out that those foreclosure rates are similar, your entire argument pretty much goes down in flames. So if you, as the person who is trying to "show" something here, can show that they aren't, you might want to get on that.

I could do that, and maybe I will, but that's not really the point of the OP anyway. Because like it or not, Obama lied to *you* in his economic speeches and the debate when he tried to make *you* believe that republicans had taken no action to prevent or warn against the impending mortgage crisis. For all the talk of *change* and *transparency*, Obama is no different than most of the other democrats of the past decade or two. Dishonest.

Is it the job of government to bail out a failing system; one that is vital to the health of our economy?

ROTFLOL! Oh, I see. You want to regurgitate that nonsense promoted by Obama that this event proves the absolute failure of capitalism, free enterprise and ownership? Time for socialism, government controlled economy and forced wealth redistribution?

The "system" isn't failing, Dymanic. The "system" has a tool for punishing people who manage badly and completely ignore risk. They go bankrupt and someone buys what remains of the assets and builds from there.

Here, I think you should read the following article in its entirety very carefully:

http://www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html?iref=mpstoryview

Commentary: Bankruptcy, not bailout, is the right answer

Editor's note: Jeffrey A. Miron is senior lecturer in economics at Harvard University. A Libertarian, he was one of 166 academic economists who signed a letter to congressional leaders last week opposing the government bailout plan.

Get back to me when you have. THEN we can talk.

 

[Meadmaker]

Is he a liar, Meadmaker?

If you want to call him a liar based on that, then every single ad that either campaign has produced and mentions the other candidate is a lie. I haven't seen a single ad where one candidate talks about the other's record, and doesn't distort it. In some sense, then, both McCain and Obama are liars. In this thread, I won't try to quantify or make a determination of who is a bigger liar, but I suspect we would disagree on the conclusion.

You've admitted that the vote in the committee was along party lines. Does that show ANY willingness on the part of democrats to compromise?

Does anyone else find this question from BAC really, really, funny?

(For those who didn't follow, there were two versions of the bill. All the Democrats voted for one. All the Republicans voted for the other.)

What are you standing by? Maxine Waters statement?

What does Maxine Waters have to do with anything? Unless.....nah.

 

[Dymanic]

Dymanic, do you think any of us do anything on this forum other than "mine quotes".

Yes, I do. We consider things like logic, context, and the strength of the evidence that supports the positions represented in any quotes we might reference. Otherwise, it amounts to little more than setting one mined quote against another.

If [Bush] was just as interested in political power as democrats, then he wouldn't have carried through with the Iraq invasion and certainly wouldn't have stayed the course in Iraq through the dark years when things weren't looking great and the majority in polls were for cutting and running.

I think you are confusing an interest in attaining political power with an interest in using political power already attained. I won't dispute that Bush probably has done "what he believes is the right thing to do", and while he clearly had a personal agenda that extended beyond his aspiration to become president and was willing to pursue that even at a cost in popularity, I don't doubt that he probably has felt all along that what he was doing was the "right thing" for his country as well. The problem is that he was obviously wrong about that. The Iraq debacle has come at an enormous cost in human lives and human suffering, and the half a trillion dollars we've spent can hardly be lightly cast aside either. But perhaps the greatest cost has been the standing of the United States in the international community. Bush's popularity is the least of it. But that's not really what we're talking about here, is it?

I could do that, and maybe I will, but that's not really the point of the OP anyway.

In the OP, you specifically pointed to the CRA as the starting point for this whole thing, and you're charge against Obama rests almost entirely on that. It was your idea to introduce this line of argument, and I'd say that in doing so you have incurred an obligation, one that is hardly met by handing out reading assignments, unless they include data that might support your claim.

The "system" isn't failing, Dymanic. The "system" has a tool for punishing people who manage badly and completely ignore risk.

You might also say that the laws of physics have tools for punishing those who drive recklessly on the freeway: they tend to crash. The fact remains that the freeway isn't going to be available for use by those who drive responsibly until someone clears away the wreckage.

 

[BeAChooser]

Keep in mind that every single member of the committee voted for this bill, in one version or another. All the Democrats voted for the bill.

Where do you get that? You just told us in post #52 that it made "it out of committee, ammended, on a straight party line vote." And your source confirms that. It states that S.190 in the Senate "was passed on a straight party line vote of 11-9." So ALL the democrats in the senate committee voted against it.

Now granted, the House version, again introduced and sponsored by republicans, passed out of committee 65-5 so a lot of democrats had to have voted for it. In fact, it passed the full House (http://www.realtor.org/GAPublic.nsf/Pages/gsepasseshouse?OpenDocument ) before the Senate democrats apparently again killed it. Now why would the bill pass in the House? Maybe the house version had some social engineering pork for democrat constituents? Let's see ...

"It also creates a new extremely-low- and low-income housing program, mostly to build rental housing, that is funded by five percent of the GSEs after-tax profits." And as your link said "This fund is in addition to historic low and moderate income housing goals for the GSEs"

Yep.

If the Senate leadership would have wanted this bill, they could have had it.

Sure Meadmaker. All they had to do was wave their magic wand and democrats would have voted for it. That's the way Congress historically works, right? Maybe republicans should have waved their magic wand during the trial of Clinton in the Senate.

Quote:
It's a fact that civil rights lawyers (including Obama) did force banks to loan money to people who weren't really qualified, financially, for a loan.

And it's a fact that most of those people were..........African Americans.

So what? If they weren't qualified financially for the loan ... they weren't qualified financially, regardless of color. But at least you are tacitly admitting that democrats USED race as a reason to get people loans they couldn't afford and were likely to lose at the first downturn in the economy.

The guy in the break room wasn't being racist.

There you go, waving the race card. CLAIMING you heard something. I'm not buying it, Meadmaker. And I'm not buying your attempt to link my financial argument to racism.

He was telling the truth, as he saw it, and he wasn't putting lipstick on the pig.

Are you trying to link Palin to this too, Meadmaker. Do you have some evidence she's said such things around the *watercooler*? Is that how low your argument on this thread is going to go?

He was saying exactly the same thing you were saying. He just got straight to the point.

So you're calling me a racist? I frankly think you are the racist since you wave that flag at every opportunity. I think Bernard Goldberg is right when he says it has to do with YOUR GUILT. What are you feeling guilty about, MM? Did you do something that you have to make up for?

By the way, in case you haven't guessed, my discussion with you on this thread is over. I shall simply stand by what we've already posted and ignore you ... at least on this thread. If you can't be civil and argue verifiable facts, instead of "watercooler" claims while throwing the race card, there is absolutely no reason to debate you further.

 

[Gurdur]

Only 3 's in the last post, things are obviously calming down under the juggernaut of the inevitable Obama presidency.

 

[BeAChooser]

I wondered why BAC, who had seemed so eager to discuss details, suddenly fell silent when encouraged to provide evidence that CRA-regulated loans were more likely to end in foreclosure.

ROTFLOL! I love the impatience shown by you. Do you think posting to you folks is the only thing I have to do? Maybe you don't have a life? If you haven't noticed by now, I come and go from forum throughout the day. Sometimes I'm gone for days. Sometimes I stay for hours. Sometimes just for minutes. But I always start where I left off and I almost always respond to every substantive post made to me, and every comment made in those posts, in the order they are made. I tend not to read ahead either. And by the way, because of that, I'm probably having to post 3 times as much on this thread as any one of you. So give me a little slack if I don't get back to you the moment you post. If you demand an immediate response, I suggest you find a chat room. You'll be happier.

"Our study concludes that CRA Banks were substantially less likely than other lenders to make the kinds of risky home purchase loans that helped fuel the foreclosure crisis."

Would you like to scold Meadmaker for calling me a racist without even *quote mining* to back up his smear? Because unless you're willing to do that, I see no reason to continue a discussion with you either. We either all try to make this a civil debate or it won't be a debate at all. I'll talk about that study and what it says, when you do. If not, so be it. Besides, I've already proved what I wanted to prove on this thread. Obama is a LIAR.

 

[Dymanic]

I'll talk about that study and what it says, when you do.

What more is there to talk about? You started the thread because you "wanted to prove" something, and argued that "Obama and his civil rights friends won the case, forcing banks to make loans that simply weren't financially sound." I became involved out of a desire to better understand the nature and cause of the present crisis, and when Meadmaker posted a link to an article which referenced an actual study -- involving actual data -- I took a look, as you had not (yet) responded to my suggestion that your arguments might be made more compelling if they were better supported by evidence. As it turns out, that study not only fails to support your position, it strongly refutes it; CRA regulation may actually be an indicator that a loan was financially sound, rather than the opposite.

Do you question the methods used in that study? The conclusions of its authors? Would you like to argue that the study was biased? Would you like to present another analysis of the same data, or of some other data? If so, please do proceed (at your earliest convenience, of course).

If not, I think I'll have to dismiss most of what you say as mere assertion, and go with a preponderance of the evidence I've seen so far, which indicates that the CRA could not have had much to do with the present crisis -- and I doubt if I will have very much more to say to you on the matter. Like yourself, I have other things to do.

 

[Meadmaker]

Where do you get that? You just told us in post #52 that it made "it out of committee, ammended, on a straight party line vote."

The Democrats introduced an ammendment in the form of a substitute while the bill was in committee. From the one paragraph summary I read, that ammendment in the form of a substitute was very similar to the House bill, but that could be wrong. The Democratic ammendment was rejected by the committee on a straight party line vote.

So, all the Democrats voted for it, and all the Democrats voted against it. All the Republicans voted for it, and all the Republicans voted against it.

If I can find a reference to the Democratic ammendment within five minutes of googling, I will, but I won't spend more time than that on it.

There you go, waving the race card. CLAIMING you heard something. I'm not buying it, Meadmaker. And I'm not buying your attempt to link my financial argument to racism.

Bummer. What will I do now?

So you're calling me a racist?

Huh? Because you are saying the same thing as the guy who used the 'N' word? Is that racist?

Racism isn't some sort of binary switch with only on and off values. I don't think that guy in the break room (the metaphorical "water cooler") was especially racist. On the other hand, he had bought into the erroneous arguments that loans to black people were the cause of our current financial crisis. You did the same thing. You and he are saying the exact same thing, but he was using coarser language. He does that. He also says words that start with "f" and "s" a lot. If he was a racist, was it because of his use of a racial epithet? Is that what makes someone a racist?

You will have to decide whether or not you are a racist. I am suggesting that people who bring civil rights lawyers and Maxine Waters into credit related discussions are more likely to be labelled as racists, fairly or otherwise.

By the way, in case you haven't guessed, my discussion with you on this thread is over.

I'm not surprised in the least.

 

[BenBurch]

"Discussion" was over with the author of the OP long before he posted it, Meadmaker. I do not recall that I have ever have ever seen him be convinced of even one thing contrary to his stated views on any subject, and he rarely acknowledges factual errors when they are pointed out.

 

[Meadmaker]

Here's an article that referred to the Democratic ammendment I noted. A different article said that the Democratic ammendment was offered in the nature of a substitute, but I have not read the whole history, nor do I intend to.

http://www.allbusiness.com/government/532756-1.html

One relevant paragraph:

The committee also rejected an amendment by Sen. Jack Reed (D-Rhode Island) that would have directed the GSEs to contribute a percentage of their earnings to an affordable-housing trust fund. But the committee approved an amendment by Sen. Rick Santorum (R-Pennsylvania) to rewrite Fannie and Freddie's affordable-housing goals. Both measures were rejected and adopted, respectively, along party-line votes.

The "also" above refers to a different ammendment offered by Paul Sarbanes, a Democrat.

 

[BeAChooser]

Ok, folks, I've taken a look at the source that Meadmaker announced "doesn't seem to think that the community reinvestment act or the efforts of civil rights lawyers played a significant role in this crisis." That would be a Mr. Aaron Pressman.

And who is Mr Pressman? Some guy who writes for BusinessWeek? Now and then? Or just this once? What are his credentials? A few years ago he was writing for Slate Magazine, on issues related to the internet. Such as "Civil Disobedience on the Web - By Aaron Pressman - Slate Magazine, July 29. 2000" where he reported on activists' plans to disrupt the Republican National Convention. And he wrote for the Washington Bureau of The Industry Standard. Again, something to do with the internet. Before that he worked for Reuters. Ah ... yes. Way back when, Pressman worked at several financial trade publications ... Bond Buyer and Investment Dealers Digest. Don't tell me he was one of those people pushing CRAs back then? Just kidding.

Now Pressman leads off his defense of democrats by proclaiming "The Community Reinvestment Act, passed in 1977, requires banks to lend in the low-income neighborhoods where they take deposits. Just the idea that a lending crisis created from 2004 to 2007 was caused by a 1977 law is silly." Of course this is a strawman and some of those who commented on that web page where Mr Pressman posted noted that. The argument is NOT that the 1977 law signed by Jimmy Carter caused the problem. That is silly. It was just the opening shot (as I pointed out in my own thread) in a social engineering agenda that was to carry forward and grow, especially in the 90's when democrat *community activist lawyers* like Obama decided to call mortgage lenders racists and encourage Bill Clinton to expand the CRA law further. I posted links earlier showing how much the mortgage market grew during that time, compared to 1970's and 1980s. It really took off. As noted in the comments on that web page, "the number of CRA mortgage loans increased by 39 percent between 1993 and 1998, while other loans increased by only 17 percent." And the number of sub-prime mortgages (which are particularly problematic) went from "1% of all mortgages issued to 12% within THREE years of the Clinton Administration" strengthening the CRA law.

Now Pressman declared "the CRA was at its strongest in the 1990s, under the Clinton administration, a period when subprime loans performed quite well." Did they perform well? Or did Clinton just luck out in that the 90's were a period of economic boom due to the previous administration's tax policies, the collapse of the Soviet Union, cuts in welfare and other funding forced on Clinton by Gingrich/republicans, and the internet boom. As the sources I noted said, the problem would come when a recession started.

And that is exactly what happened. A recession started just at the end of Clinton's term in office and then deepened due to 9/11 and WOT. And that's when foreclosures started climbing. Yet, during that whole period from 2000 to 2005, when Bush and other republicans were sounding the alarm and calling for reform of the mortgage industry to prevent disaster, democrats fought tooth and nail to keep things as they were, calling republicans racist and uncaring.

All this, of course is lost on Pressman.

Now Dymanic quoted a source that Pressman linked indicating it said "Our study concludes that CRA Banks were substantially less likely than other lenders to make the kinds of risky home purchase loans that helped fuel the foreclosure crisis." Here's the *study* that Dymanic quoted.

http://www.traigerlaw.com/publications/traiger_hinckley_llp_cra_foreclosure_study_1-7-08.pdf

And who performed THIS study? The LAW FIRM of Traiger & Hinckley. If the contents of their website is any guide (http://www.traigerlaw.com/index.php ) they have quite a vested interest in seeing CRA continue. It's their bread and butter.

Now as to their study, what is not analyzed is the actual relationship between CRA banks and their foreclosure rates. It does not answer the question: Do CRA banks have a higher foreclosure rate?

What was looked at? The percentage of loans from CRA banks that foreclosed as compared to non-CRA banks? No. The study looks at 4 things ... the proportion of high cost loans, the pricing of high cost loans, the proportion of originated loans retained by the lender, and the relationship between foreclosure rates and concentration of bank branches. So it doesn't actually answer the specific question I raised.

Isn't it ironic, folks, that Fannie Mae singled out one bank as the role model in terms of its commitment to CRA lending? Countrywide. It was the nation's largest mortgage lender and had committed to $600 billion in low-income or "subprime" loans as of 2003. Countrywide essentially went bankrupt and was merged with Bank of America. This is discussed in an April 26 New York Post article on the CRA titled "The Real Scandal," by Professor Liebowitz (http://www.nypost.com/seven/02052008/postopinion/opedcolumnists/the_real_scandal_243911.htm?page=0 ). Oh sure ... CRAs had nothing to do with this crisis. Nothing at all.

Did anyone notice who Traiger of T&H has given money to, over the years? See http://www.newsmeat.com/fec/bystate_detail.php?zip=10021&last=Traiger&first=Warren Answer: Democrats ... and most recently ... Obama.

But I will say this for T&H. They also did investigations on whether racial bias factored into mortgage loans and found it didn't ... contrary to what was being claimed by democrats. http://findarticles.com/p/articles/mi_m0EIN/is_/ai_n13787144 "Although HMDA data can never conclusively prove or disprove discrimination, the Traiger & Hinckley LLP study suggests that with regard to home purchase loans with rate spreads, lenders are treating minority and women homebuyers fairly." Looks like they are buttering both sides of the bread.

And finally, I wonder ... did Dymanic bother to read any of the other comments in that web page where Pressman posted ... because they rather successfully and thoroughly took Pressman's assertion apart. Probably didn't. Probably too busy "quote mining", to look at the facts and logic in those MANY posts.

 

[Meadmaker]

And who is Mr Pressman? Some guy who writes for BusinessWeek? Now and then? Or just this once? What are his credentials?

You'd better let Business Week know about this. Those folks have let him publish 16 articles in their print magazine since 2005. Of course, he has a lot more BW online, and blog entries like the one cited in this thread.

And what is this Business Week magazine? Some liberal rag? How come I've never heard of them? Do they give money to Democrats?

Did they perform well? Or did Clinton just luck out in that the 90's were a period of economic boom due

Your two options don't seem to contradict each other.

Of course, it is well understood that all good things that happen when the other guy's party is in power were actually due to our guy's leftover policies, but all good things that happen when our guy is in power are due to our own policies. That's just simple logic.

And that's when foreclosures started climbing.

Oddly, many economic statistics don't reflect this trend, suggesting instead that foreclosures really started rising somewhat later.

All this, of course is lost on Pressman.

Indeed, I am sure that much of your analysis would be lost on Mr. Pressman.

And who performed THIS study? The LAW FIRM of Traiger & Hinckley.

What??? Lawyers?!?!?! How come nobody told me about this? If I had known they were lawyers I would have just ignored their statistics. Oh, man. This is so embarrassing. Lawyers. I can't believe I referred to lawyers.

low-income or "subprime" loans as of 2003.

I don't suppose you would care to clue us in on the definitions of the terms "low income" and "subprime". Hint: You have to give two definitions.

 

[Dymanic]

Now as to their study, what is not analyzed is the actual relationship between CRA banks and their foreclosure rates. It does not answer the question: Do CRA banks have a higher foreclosure rate?

I agree. That is inferred, but not demonstrated. If I had started a thread based heavily on the premise that CRA banks had a lower foreclosure rate, you'd be justified in objecting that inference is not sufficient to make a case for that, even though the bases for that inference were clearly stated and reasonably compelling. As it is, you started this thread based on the opposite premise, and while it's a bit hard to tell where inference ends and bald assertion begins, it's pretty clear that you haven't made your case either.

And finally, I wonder ... did Dymanic bother to read any of the other comments in that web page where Pressman posted ... because they rather successfully and thoroughly took Pressman's assertion apart. Probably didn't. Probably too busy "quote mining", to look at the facts and logic in those MANY posts.

Quite a lot has been written about this, and I don't claim to have read very much of it, and it is partly that I often am fairly busy -- heck, in six years on this forum, I haven't had time to rack up a post count like the one you've managed to achieve in a year and a half -- but you might note that the only quote I've contributed to the thread is the conclusion of that study.

Your objection on the basis of bias is reasonable enough. If the only material worth reading is that which originated with indisputably unbiased sources, that would probably cut the reading down quite a bit, so if you could provide a list of those sources, that would be very helpful. I'd venture to guess that you've redirected some portion of the time you might otherwise have dedicated to wading through "comments" on "web pages" toward looking for some data that might provide a more direct way of comparing foreclosure rates between CRA and non-CRA lenders, and haven't had any more luck than I have. Not that I've tried nearly as hard as I would were I in your position.

 

[Meadmaker]

The President of the Federal Reserve Bank of San Francisco doesn't seem to think very much of the premise from the OP either.


http://www.frbsf.org/news/speeches/2008/0331.html

Before I turn to potential interventions, I want to make one final point. There has been a tendency to conflate the current problems in the subprime market with CRA-motivated lending, or with lending to low-income families in general. I believe it is very important to make a distinction between the two. Most of the loans made by depository institutions examined under the CRA have not been higher-priced loans,16 and studies have shown that the CRA has increased the volume of responsible lending to low- and moderate-income households.17 We should not view the current foreclosure trends as justification to abandon the goal of expanding access to credit among low-income households, since access to credit, and the subsequent ability to buy a home, remains one of the most important mechanisms we have to help low-income families build wealth over the long term.18

Oh, wait. That's San Francisco. We can't take that seriously can we? Nancy Pelosi's home town? I'll bet that woman gives money to Democrats.

What about this guy?

http://www.communityinvestmentnetwo...ship/?tx_ttnews[backPid]=760&cHash=bac37f6710

The deterioration in underwriting standards that appears to have begun in late 2005 is another important factor underlying the current crisis. ...
Much of the weakening in underwriting standards appears to have happened outside of institutions regulated by the federal banking agencies

.


One aside:

Over the past quarter century, advances in information technology, the development of credit-scoring techniques, and the emergence of a large secondary market, among other factors, have significantly increased access to mortgage credit. From 1994 to 2006, subprime lending increased from an estimated $35 billion, or 4.5 percent of all one-to-four family mortgage originations, to $600 billion, or 20 percent of originations (Inside Mortgage Finance, 2007).

I just wanted to note that the number Bernanke gives for the entire subprime market in 2006 is the number BAC quoted earlier for Countrywide in 2003. I know he'll want to correct the record, becing a stickler for facts as he is.

 

[GreyICE]

I knew it! It was all Bill Clinton's fault!

 

[chipmunk stew]

I knew it! It was all Bill Clinton's fault!

It's a BAC thread. Of course it's Bill Clinton's fault.