On Mon, 22 Jun 2009 15:27:52 -0400, Kurt Ullman wrote:
In article ,
AZ Nomad wrote:

Perhaps you need to get your news from sources other than right wing radio
shows.

You mean like Economist Stan Liebowitz who wrote in the New York Post
that a strengthening of the CRA in the 1990s encouraged a loosening of
lending standards throughout the banking industry. He also charges the
Federal Reserve with ignoring the negative impact of the CRA.
You mean like Jeffrey A. Miron, a senior lecturer in economics at
Harvard University, in an opinion piece for CNN, calls for "getting rid"
of Fannie Mae and Freddie Mac, as well as policies like the Community
Reinvestment Act that "pressure banks into subprime lending."

However, it should also be noted that a Fed study showed approximately
50% of the subprime loans were made by independent mortgage companies
that were not regulated by the CRA, and another 25% to 30% came from
only partially CRA regulated bank subsidiaries and affiliates. (My main
problem with this study is that they did not (or were not) able to tease
out how much of these loans were from the CRA-regulated part. . Another
study showed one in four subprime loans came from CRA-related banks.
(Which sorta backs up the

The upstart is that there is still quite a bit of confusion as to what
(if any) part the CRA played in this mess. Not a big surprise since we
still haven't really been able to get a good handle yet on how big the
mess really is let alone cause(s).

I'd be interested in hearing a list of actions taken against lenders
who were "too strict" in their lending policies. All zero of those
actions.

Just because the restrictions were relaxed doesn't mean that lenders
were forced to hand out money without checking qualifications. It should
be obvious that it was in their best interest not to make bad loans.
However it was possible to write bad loans, take a quick profit, and
then boot the loans to another victim by packaging them in a bundle
of other loans.