1999 NY Times Article Revealed True Cause of Current Fannie Mae Crises

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This is probably an article that the New York Times wishes it didn't have in its archives because it reveals the true culprits behind the current Fannie Mae meltdown. You will find "uncomfortable" truths in this September 30, 1999 article by Steven A. Holmes starting with the title, "Fannie Mae Eases Credit To Aid Mortgage Lending,"  that you won't find in current editions of the New York Times (emphasis mine): 

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

Get that? Pressure by the Clinton Administration to expand mortgage loans by lowering its credit requirements.

''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.'' 

That would be the same Franklin Raines whom the Washington Post identified as a mortgage and housing adviser for the Obama campaign until that newspaper told us not to rely on its own reporting. We return you now to the article that the New York Times wishes didn't exist:

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

Oops! And that is exactly what has happened nine years later. And who were the "killjoys" at the time warning against Fannie Mae easing the credit requirements? That answer is also provided in the NY Times article:

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''

Yup. The conservative American Enterprise Institute was accurately warning about this impending financial disaster back in 1999. If you don't believe me, then check out the New York Times archive. 

—P.J. Gladnick is a freelance writer and creator of the DUmmie FUnnies blog.


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Shazam!

Shazam!

Blame where it is due

First, blame Democrats for figthing any improvement in regulations, starting with Clinton (per the NYT), and then resisting regulations all through the Bush years, including the McCain co-sponsored bill, S.190, submitted in 2005 and again in 2006, where Democrats would not let the bill be passed, a bill that would have gotten the process going towards better regulation.

Second, blame all the MSM, who have clearly supported the Democrats, for MSM's failure to say anything. They would rather see the country in economic chaos, than to see a Democrats lose an election.

Third, blame the greedy CEOs, who could see this all coming, but did nothing to curtail it.

Fourth, blame the greedy bastards, who were not poor people trying to buy their first home, but entreprenuers with falsified documentation, going around trying to flip houses with cheap money they could borrow for purchases and renovations.

Finally, blame those who vote Democrat for being so stupid to elect people who's only mission is to "give away the ship".

 

wdhorning

You’ve put it succinctly. All that I can add is AMEN!

--------------------------------------------------------------------

You want change? I’ll give you change. The most important change we can make is to vote out the Democrats and RINOs in Congress!

So to distill what you

So to distill what you said, when stupid and greedy get together we get a Democrat...

Nancy Pelosi and Harry Reid, starving the poor one gallon of ethanol at a time. Fill your tank with E85 and cull a village.

Good work, PJ!

This is why NewsBusters is where I recommend everybody should go to get their news.

Impunitas semper ad deteriora invitat.

LMAO....P.J. this is

LMAO....P.J. this is PRICELESS!

Excellent find!!! 

"America isn't the problem...America is the solution." ~ Rush Limbaugh

But the

But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

How ironic that it was the very misguided policies of the Democrat's drilling ban which pushed up crude oil and gasoline prices to the point the economy started to faulter.  You will notice that our real problems with the mortgage industry started when the price of gasoline quickly ran up from $2/gal to $4/gal thus causing the economy to slow down and people at the low end of the economic scale to be laid off.  Now you can see how utterly stupid Nancy Pelosi and Harry Reid really are.  The morons and there buddies couldn't see past the end of their PC noses to realize their conflicting policies.  Since the 1970s every recession and economic slowdown was due to the fast run up in the price of energy.

Nancy Pelosi and Harry Reid, starving the poor one gallon of ethanol at a time. Fill your tank with E85 and cull a village.

and did you know

that Reid just introduced a bill to stop all shale oil drilling everywhere.

Guns and Violence are not the answer but they are one solution to the problem== SARG

I heard he tried to sneak

I heard he tried to sneak it in and it was found and stripped out.  He's a real piece of work.

Nancy Pelosi and Harry Reid, starving the poor one gallon of ethanol at a time. Fill your tank with E85 and cull a village.

Hi dscott and I.am... A

Hi dscott and I.am...

A real piece of work indeed...

...we were discussing this on OT earlier...I was listening to some of this on the Senate floor this morning. 

Just like Reid trying to get through the Dream Act which was another amnesty bill on a Monday morning I think it was when he hoped nobody was looking...

Phones rang off the hook o where they had to shut down the whole phone system to congressional offices.

"America isn't the problem...America is the solution." ~ Rush Limbaugh

and did you know

Nancy Pelosi wants to give another stimulus

package to everyone right now in addition to

giving $709 billion for a bailout.  Talk about

stupid is as stupid does.  This woman is just

clueless.   Where is the money supposed to

come from????    Take taxpayer money and

give it back to them and call it a stimulus then

as soon as they get in office say "psyche".

Gotcha!!!!!   We're raising your taxes.  

 

 

Yes this book cooking goes back a long way

I talked with my dad yesterday.   He said his financial newsletter that he paid for (subscription) said that the accounting in Fannie was not accurate and to be careful.  Not sure how long ago that was; at least 10 yrs. ago and prior to this article.

But if you position yourself

But if you position yourself just right, like Obama advisor Franklin Raines did, you can make millions!

Jesus, Mary and Joseph

If McCain and the RNC, in general, do not hammer at this with ads and general talking points from now until the election then, screw 'em, they deserve to lose.

"All generalizations are false, including this one.” Mark Twain

As BD would say....

SHACK!!!! 

David Gregory, do you know which damn network you lie for? ~ Uncle Jimbo, @Blackfive

 

Mr. Gladnick:

How many of these loans did Fannie Mae actually buy - in dollars and as a percentage of its annual volume?  This is the loan product that did Fannie Mae in? 

And when did these loans begin to go bad (assuming they did, of course, as a 1999 article won't tell us that)?  It takes an average of at least three years for a conventional home loan to go south (not including first payment defaults and other fraud, of course).  So Fannie Mae would have started taking major hits starting in 2003.  Is that what happened seven years ago? 

Are you suggesting these are the same loan programs as sub-prime, or even neg am option ARM's?  Alt-A?  Loans that Fannie Mae would not purchase from mortgage originators?

And what does this article have to do with the implosion of vintage 2005, 2006 and 2007 mortgages?  Were these sound loans in 2000 and terrible ones five years later, some sort of financial time bomb?

Why not just...

..look it up frank!

"There are two types of people in this country; those who provide freedom and those who enjoy it." MM says...

BigMouth:

Thanx for a worthless link.

Why don't you explain to all of us why President Bush appointed people as head of the SEC, etc., who had no interest in regulation?  Why didn't these people use the powers available to them?

Sen. McCain is always for less regulation.  So is President Bush.  Now we reap what they sowed.

Ass Hat...

You are welcome. I see you didn't read it, probably don't have time for facts and opinions that don't meet with your whinney liberal positions. All it is, "is", the time line that led up to the buble bursting. Your rants don't seem to have changed in two years, same old Bush hating liberal blather... btw..

Don't suppose you have seen this yet, posted by another NBer. 

  "There are two types of people in this country; those who provide freedom and those who enjoy it." MM says...

That's a great video, MM!

That's a great video, MM! Lots of good sounds, too.  ;^)

Nah, frankie ain't interested. Any dreams that it's all Bush's fault stand up to any facts that say it isn't, in frankie's book. You know the score when it comes to that, surely.

But I plan on plastering this all over the web.

 

"... smells like... victory." - Robert Duvall

MightyMouth... Great

MightyMouth...

Great video! Time to spread it far and wide.

Palin/Gore/Clinton - Hate/Love/Hate

 

 

Making Fun of AGW http://giovanniworld.wordpress.com/  

What up, MightyMouth?

Long time no see!

-Dave

Politicians are the only people in the world who create problems and then campaign against them - Rick Roberts

My troll fuse length today: 0.003mm

love it, Love It, LOVE

love it, Love It, LOVE IT!!!!!

How do we go about spreading this to others in the country so we can set them right with what has gone wrong with FNMA & FHLMC?

The Dems are quick to point their fingers at the Republicans, must have broke a few wrists when suddenly had to do a 180.

Would love to link Schumer to this the next time he is around for re-election.

Somehow Related??

Body count. In the last six months 292 killed (murdered) inChicago, 221 killed in Iraq. Sens. Barack Obama & Dick Durbin, Rep. Jesse Jackson Jr., Gov. Rod Blogojevich, House leader Mike Madigan, Atty. Gen. Lisa Madigan, Mayor Richard Daley.....our leadership in Illinois.....all Democrats. Thank you for t he combat zone in Chicago. Of course they're all blaming each other. Can't blame Republicans, they're aren't any! State pension fund $44 Billion in debt, worst in country. Cook County (Chicago) sales tax 10.25% highest in country. (Look'em up if you want). Chicago school system one of the worst in country. This is the political culture that Obama comes from in Illinois. He's gonna "fix" Washington politics?

(GRINS)  kilrod

Remember, only two defining forces have ever offered to die for you, Jesus Christ and the American Soldier

Proof from the NYT from yesterday that it LIES today

First it reports the good News . . . then it SPINS the BAD news.
Or . . . they fall back on the SINS of OMISSION.
The Republican Revolution will not be Televised

Convenient timing

And did you notice that Clinton had this announced FOUR DAYS before the 2000 election?  Let's go buy a few more votes by making mortgage money available to people who can't afford to pay it back.  And then, go vote for AlGore.

How'd THAT work out for you, Dems??? 

The Same Andrew Cuomo?

Is this the same Andrew Cuomo that  McCain just recommended as a replacement for Cox?  Shhhh

INCREDIBLE FIND !!!

P.J., great work !!!!

We *HAVE* to get this out! I mean, right there, right in the first three paragraphs, with the exclamation point being paragraph #3 -- pointing right to the urging of Bill Clinton and his administration to pass it.

Amazing.

And it was all to help minorities and low-income buyers. The blame lies squarely on the shoulders of the Democrat's flawed ideology of handing things out to their prime voting bloc, the "underprivilaged", at the cost of the rest of us.

 

NOW PLAYING:
Governor Palin Get Your Gun

 

And the chickens...

...have come home to roost.

I truly don't believe there is any way that the political heroes can spin their way out of this one.

And the B. Hussein O. camp is knee deep in this one...

Doing my Part

I have emailed this along with The Hud Article posted by Gary Hall to everyone I know...

Bingo.

Bingo.

Once more, where there's smoke, there a Clinton.

He can't escape this one. 

 

Priceless.

Wow.

The New York Times.  

This is priceless.

No, wait, this really is PRICELESS -- because it will cost we taxpayers a FORTUNE BEYOND OUR WILDEST DREAMS . . .

I'm sick and tired of socialist hand-out Democrats.  You'd think they'd learn, but nooooooo.......

(By the way, I love Newsbusters. We need to spread this story around like mayonnaise on a tuna sandwich!!!!!) 

 

Hi ag... I agree...and

Hi ag...

I agree...and have passed it on already to a couple of people I know, maybe this will make one of the network shows (FOX...duh') or the radio airwaves...you just never know.

"America isn't the problem...America is the solution." ~ Rush Limbaugh

Great Job P.J.

 This is 1 of the reasons that they didn't want McCain to come to Washington they were afraid that the truth would start to come out about how the dems had a big hand in causing all of this to happen.

It's really amusing how democrats always keep attempting to rewrite history and the media allowed them to do it and and allowed them blame republicans for the financial crisis.Maybe the fact is Obama was afraid to come back to Washington was due to the fact the he has close ties to alot of the people who actually helped cause this problem in the 1st place and when McCain and President  Bush attempted to stop the problem the dems and Obama had a hand in stopping them from doing so.The reason they didn't want McCain to come to Washington is because they are afraid he is going to point out that Obama and the democrats are at the root of this problem in front of all the national media where they can't just sweep it under the rug or ignore it anymore like they have been doing for so long.

http://www.youtube.com/watch?v=H5tZc8oH--o&eurl=http://dyn.politico.com/members/forums/thread.cfm?catid=1&subcatid=2&threadid=1472311&start=61&CurrentPageiurl=http://i1.ytimg.com/vi/H5tZc8oH--o/default.jpg

LS... Eye of the Tiger

LS...

Eye of the Tiger indeed!!!

...that was the best ten minutes I have spent today..I don't know how to thank you except to say thank you...

I am passing this on to all I know that will really take the time to listen.

Wished I wasn't in a hurry at the moment...

For any of you out there reading this...click the link LS provided..it is well worth it...

Very well worth it!

"America isn't the problem...America is the solution." ~ Rush Limbaugh

Awsome LS

Simplifies it for us simpletons, Thanks

 

"Television is a freak show" Bernie Goldberg

Bookmarked it!

Bookmarked it!

Great link

Awesome video.

You guys have this all

You guys have this all wrong. This is Bush's fault. Bill O'reilly said so.

Mark Levin played this on

Mark Levin played this on his radio show earlier this week, and smacked down bill the way that only "the great one" can do.  It was great.

»→ BillO's Bush Bash

Bill doesn't understand that if the President had shouted this problem from the rooftops, we would have gotten IndyMac/Schumer across the spectrum by the next day.

Bush did his job, and Barney Frank did what his owners demanded. 

Kill Bill II - Stop the bailout

whoops

 

"There are two types of people in this country; those who provide freedom and those who enjoy it." MM says...

Thanks

For publishing this, I'm a first itme poster here but have been here many times to get the real dish and not spoon feed the usual MSM garbage. Knowing the MSM will not pick up on this I agree with a previous poster that McCain should broadcast this loud and clear in his adds with the definite connection to Mr Raines. That's the ONLY way this will get out. Glad to be part of you community.

 

United we stand, divided we fall

C-4-Life

I aint nobody, don't wanna be nobody, but glad to see ya here, Have a Good-un,

(GRINS) kilrod

Remember, only two defining forces have ever offered to die for you, Jesus Christ and the American Soldier

ACORN

Am I the only one who just heard Sen Graham on Greta say that 20% of the bailout money is/was slated for ACORN! Holy crap Marge, why not just rename Obama, Vladamir  and get it over with.  There's going to be some real stuff hitting the fan in my senators office if that's true.  Graham said that's one of the things the Republicans are resisiting.  THEY BETTER!!

Barak Obama is a political sociopath..

I heard it.  Freakin

I heard it.  Freakin IDIOTS!!!!!!!!

140 billion to ACORN?

140 billion to ACORN? No...freakin'...way! Surely he misspoke?

ACORN is what got this whole thing started. To Hell with them.

No bailout, no-way, no-how.

Never.

-Dave

Politicians are the only people in the world who create problems and then campaign against them - Rick Roberts

My troll fuse length today: 0.003mm

Why not give the money to the Mafia

Same damn difference.Acorn is crooked.They have been nailed in numerous states for voter fraud.

http://www.rottenacorn.com/activityMap.html

ACORN

I heard it also... The Dem's will try anything and probably get away with it because of the MSM...

And instead of hammering the

And instead of hammering the airwaves with this, the media will say nothing about it, costing us even more.  They are nothing short of an enemy within.

So, think of what this

So, think of what this means....

In the name of the infamous "DIVERSITY" bull****, we are now in a massively serious economic crisis.

....IN THE NAME OF D-I-V-E-R-S-I-T-Y!!!!!!!!!

I swear my head's gonna explode!!!!!

P.J.

That archived New York Times article was a great find.

Thank You!

-----------------------------------------------------------

You want change? I’ll give you change. The most important change we can make is to vote out the Democrats and RINOs in Congress!

Could someone please copy

Could someone please copy and paste the entire article from the 1999 NYT?  I have tried clicking on the link numerous times, but the page won't load for me, and I would like to read the whole article.  Thanks!

The truth hurts.

Back then, the liberals foresaw what might happen, and went ahead anyway. Therefore they accepted the consequences of their action. Therefore they accepted ahead of time the result that we are experiencing today.

Hardly anything happens in politics that is not foreseen and intended.

 

New York Times suffers memory loss

The New York Times is an archive full of material that it seems to have forgotten publishing just a few years ago.

And it simply makes liars out of the Democrats and their campaign HQ: the media. the Barney Frank comment is the money shot.

Such as this one from the New York Times, Sept 11, 2003...

The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac -- which together have issued more than $1.5 trillion in outstanding debt -- is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates. ...

The proposal is the opening act in one of the biggest and most significant lobbying battles of the Congressional session. ...

''The current regulator does not have the tools, or the mandate, to adequately regulate these enterprises,'' Mr. Oxley said at the hearing. ''We have seen in recent months that mismanagement and questionable accounting practices went largely unnoticed by the Office of Federal Housing Enterprise Oversight,'' the independent agency that now regulates the companies. ...

Significant details must still be worked out before Congress can approve a bill. Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.

''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."

Vote 4 change. Vote 4 anything. See Jack & Mr Shy's first campaign ad for the ONLY viable 3rd party candidate.

Bailouts and boneheadedness

Bailing out the S&L's - millions
Bailing out Fannie and Freddie - Billions
Seeing Liberalism exposed - Priceless
Dan
++++++++++++++++


Normally I don't root for the disease. But in your case I am willing to make and exception.

Three Words

Hoe Lee Sh*t

http://VocalMinority.typepad.com
Jewish and Republican?? Oy gevalt