In 1999 Bill Clinton signed into law a bill entitled “The Gramm-Leach Bill” which changed the prior law, Glass-Steagall which regulated banks and prevented them from becoming Wall Street speculators with theirs and depositors funds. This new bill then paved the way for Banks, Wall Street and members of the government to act in ways that would eventually bring our economy to ruin with the Sub Prime Fiasco.
When in the U.S. Senate, Senator Obama along with Senators Chris Dodd and Barney Frank spearheaded the movement to increase the amount of subprime loans made by the U.S. banks. Now every administration before this one pushed the banks to some extent to loan money so folks could have the “American Dream” of becoming a homeowner. So the question is should the entire population, minus those incarcerated, mentally ill or being here illegally be able to own a home whether they can afford it or not? The answer is quite obvious as history has recently shown us; they cannot afford it, and thus should not have what they cannot afford. For God’s sake, if you need to use pictures on the cash register in order to ring up a sale, how the heck can you figure out how to pay for a mortgage and the accordant taxes and expenses that go along with owning a home? We are not all created equal, other than in the eyes of the law and how we should treat each other; therefore many of us are destined to become renters and not owners.
The subprime situation during the Bush years was exacerbated quite specifically by Obama, Dodd and Frank pushing the banks to make these loans and the tip of their spear was Obama’s pals in Acorn. It did not hurt either that Bush allowed for the funding of Acorn by his housing act: “The housing bill signed Wednesday by President George W. Bush will provide a stream of billions of dollars for distressed homeowners and communities and the nonprofit groups that serve them. One of the biggest likely beneficiaries, despite Republican objections: Acorn….” Wall Street Journal 7/31/08. With funding from the White House and egging on by the “housing for all” triumvirate of Obama, Dodd and Frank, Acorn went on the attack of the banks with picketing and all forms of negative PR so that the banks would make non prudent loans to less fortunate folks that they would not have done on their own without such pressure.
These same subprime loans where then sold by the banks to Fannie Mae and Freddie Mac who underwrote them thus taking on the risk of a loan, where the balloon payments in many cases would burst in the face of the homeowner, starting the subprime fiasco. Why would Fannie and Freddie do so? Because they were under the spell of the “unholy three”: Obama, Dodd and Frank. The number one and number two beneficiaries of Fannie Mae political contributions were Chris Dodd and Obama. In fact Frank Rains, who cooked the books at Fannie Mae, became Obama’s economic advisor.
After these mortgages started to grow in number Wall Street figured out a way to package and to sell them as derivatives. Yes, Wall Street through greed and much stupidity of not understanding what they were selling. The subprime derivatives were actually constructed by physicists and not by Wall Street experts, thus leaving most with a complete lack of understanding of the product they were selling.
While the crime is of course, how the “unholy three” with the help of other Democrats in congress lifted these subprime mortgage excesses to new highs with the help of Acorn and Fannie Mae, the bigger crime may be that it all could have been prevented. As history has provided and as Obama has cleanly swept under the table by using that World War II adage, “If you tell a lie big enough and often enough, people will come to believe it”, the facts clearly belie Obama’s incessant drone about how he “inherited the economic problem” from George Bush. It was George Bush and John McCain who were attempting to regulate Fannie Mae, which would have had the effect of regulating and limiting Fannie Mae’s actions with respect to the amount of subprime loans they were serving up based on the flimsiest of criteria.
There were in fact hearings in congress where the so called “party of no” was attempting to do something about the subprime problem well before it exploded in our face. Republicans such as Chris Shays, Ed Royce, Richard Baker and Don Manzullo spoke out on behalf of tightening the regulation on Fannie Mae and Freddie Mac. Barney Frank and Maxine Waters amongst other Democrats told us that “all was good”! Waters suggested that the Republicans were trying to “impede the affordable housing mission”. This is all documented in a video on YouTube from the hearings regarding tightening the regulations on Fanny and Freddy: http://www.youtube.com/watch?v=_MGT_cSi7Rs . I suggest you watch it as it is quite enlightening. It simply blows apart “THE BIG LIE” that has been told for the last two years by Obama and his machine.