Buzz and Yardley, I'm not going to quote either of you and don't even argue that the republicans certainly shared in the blame. If either side knew about the housing problem, they did not realize the seriousness of it because any idiot would have fought to correct the problem had they known. Yardley likes to give statistics but his sstatement was galringly lacking of them. let me give some according to the Census bureau. Housing ownership 1980-64.4% 1990-64.2% 2000-66.2% 2009-67.4% down for 5 straight years from a highof 69.0% in 2004. while these are 10 year increments, it appears to me that the rise was fairl steady from 1990 2009. During that period both the democrats and the republicans have had control of both houses and both have had control of the presidency. we all can point fingers but these are the facts and you can make your own conclusions.
Now some facts about the housing bubble. If you look at Fannie Mae and Freddy Mack as quasi governmental agencies(the congress set them up), and not finantial institutions which is the way I look at them, Fannie Mae as of 2008 held about 80% of ALL home mortages. They set the criteria for loan acceptance and mortgage orriginators were required to meet those standards if Fannie Mae were to purchase them. Granted there was abuse and fraud but I contend that it was Fannie's responsibility to see that the loans they purchased met those criteria. It was THEIR JOB. All those criteriayou mention-0% down interest only for the first years were in fact those standards that Fannie had as their criteria. don't you believe that if Fannie had 80% of the business then the other 20% had to go along with their criteria in order to compete?? Now for the other 20%. While it caused problems for some of them, the loans in and of themselves were not the major problem(they were the core of the problem), those things called "credit default swaps" were the massive problem. It has been estimated that there were 55 trillion $ of these things outstanding most of which were owned by finantion institutions and pension funds. Forclosure of homes would trigger these instruments causing finantion destruction. Credit default swapswere not regulated and to my knowlege have never been regulated. Iwould challenge Yardley's statement that Bush deregulated them. In fact, as I understand it, they still are not regulated even though the congress and the President signed a 2000 page + finantial bill. In fact there is no regulation in the bill of Fannie Mae even though they now have aproxomately 90% of the home mortgage business and continue to receive tens of billions of dollars to this day due to their continued insolvency.
the very core of the housing bubble, inadaquately secured mortgages, something I think that we agree on, continues to this day. While you can make a case to blame either party of blame both for that matter, how do you make a case that now the party in charge chooses a policy that ignores the problem. You can find realestate signs glaringly advertising 0% down this very day and without a doubt Fannie Mae is buying them. Do you really believe that the problem will go away continueing the same policies??
Instead of dealing withthe problem, we have a 2000 page plus finantial bill that deals with everything but the problem. A lot of people wuold not line my bill but at least I can advocate it in ONE SENTENCE. 20% DOWN NO MARE THAN A 15 YEAR MORTGAGE NO MORE THAN 25% OF YOUR TAKEHOME PAY AS MORTGAGE PAYMENT. I guarentee you there would be no future housing bubble. Now I guess that plan will bring out the crying towels, so be it.