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Will Wall Street Woes Affect The RR Industry?
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<p>[quote user="ndbprr"]And You and I will bear the costs. By the way, the Clinton administration started this by appointing Franklin Raines as head of Fannie Mae. He personally gave himself $100,000,000 before being canned. In addition he forced banks to approve the subprime loans or face stiff penalties for not giving people who can not pay their mortgages the money. He also set up Countrywide as the lender of choice. Once the risk was removed the speculators jumped in and the housing bubble started. The rest is history.[/quote]</p><p>Yes, and a big part of the politcal motivation came from pressure from the affordable housing (socialized housing) lobby. Through the Community Reinvestment Act, they pressured lenders to make loans to underqualified borrowers or else stand accused of discrimation. Then, because lenders could not affort to take the risk, they structured Freddie and Fannie to absorb the risk from the lenders. Now the chickens have all come home to roost, and the ones responsible are blaming the lenders for causing the whole problem by <em><u>predatory lending</u></em>. </p><p>Government sowed the seeds of this housing crisis. It is a red herring to blame it on Wall Street. This has all started to come into focus only during the last couple weeks. What is needed is a criminal investigation into the dealings of Freddie and Fannie. </p>
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