Comments on: Somebody Stop The "Bailout Party"

Declan McCullagh Says Increasing Evidence Suggests AIG Should Not Have Been Bailed Out

[hologram5]

STOP THE BAILOUTS... Those of us who DID not put all our eggs in one basket will do just fine. Those that did not... Sorry, you should have thought ahead and looked at the big picture.

[aheadace]

Oldtimer1941 was a good year i kinda know about 1941 myself and i think the same way as you.

[aheadace]

Hungry the Bush administration ignored meltdown warnings in 2006 but the Republicans think it didn't start until Obama got in office BUSH/PAULSON started this shi! they want to post about what Obama is giving someone but how much did Bush and company give how many billions went to AIG under Bush ?

[johns6797]

If companies or banks are "too big to allow to fail" then they are too big period. They should be busted up into smaller companies.

[aheadace]

Paulson/Bush started this BS AND THEY SHOULD BE IN JAIL!

[creeper00]

My 401k has lost sixty percent while the d@mn bankers sit pretty in their mansions. If I act irresponsibly, I pay the price. Let them do the same.

[quickly101]

I agree the bailouts should cease. Alll one has to do is look at the list of politicans(Obama included) that received campaign donations from AIG. The major problem facing this country is private financing of campaigns. Politicans put the interests of special interests who fund their campaigns ahead of the general public.

[omega39-2009]

The Community Reinvestment Acts all by itself, was an attack on banks that demanded that they make loans for houses that are krap, and to losers who don't have enough money or sense to own a house.

And it escalated because Bill Clinton and the democrats pushed MILLIONS of people into houses that couldn't afford them and bought them during the upswing of inflation.

Posted by Rowdy101

Once more....

In analyzing the available data, we focused on two distinct metrics: loan origination activity and loan performance. With respect to the first question concerning loan originations, we wanted to know which types of lending institutions made higher-priced loans, to whom those loans were made, and in what types of neighborhoods the loans were extended. This analysis allowed us to determine what fraction of subprime lending could be related to the CRA.

Our analysis of the loan data found that about 60 percent of higher-priced loan originations went to middle- or higher-income borrowers or neighborhoods. Such borrowers are not the populations targeted by the CRA. In addition, more than 20 percent of the higher-priced loans were extended to lower-income borrowers or borrowers in lower-income areas by independent nonbank institutions--that is, institutions not covered by the CRA.

Putting together these facts provides a striking result: Only 6 percent of all the higher-priced loans were extended by CRA-covered lenders to lower-income borrowers or neighborhoods in their CRA assessment areas, the local geographies that are the primary focus for CRA evaluation purposes. This result undermines the assertion by critics of the potential for a substantial role for the CRA in the subprime crisis. In other words, the very small share of all higher-priced loan originations that can reasonably be attributed to the CRA makes it hard to imagine how this law could have contributed in any meaningful way to the current subprime crisis.

Of course, loan originations are only one path that banking institutions can follow to meet their CRA obligations. They can also purchase loans from lenders not covered by the CRA, and in this way encourage more of this type of lending. The data also suggest that these types of transactions have not been a significant factor in the current crisis. Specifically, less than 2 percent of the higher-priced and CRA-credit-eligible mortgage originations sold by independent mortgage companies were purchased by CRA-covered institutions.

I now want to turn to the second question concerning how CRA-related subprime lending performed relative to other types of lending. To address this issue, we looked at data on subprime and alt-A mortgage delinquencies in lower-income neighborhoods and compared them with those in middle- and higher-income neighborhoods to see how CRA-related loans performed. An overall comparison revealed that the rates for all subprime and alt-A loans delinquent 90 days or more is high regardless of neighborhood income. This result casts further doubt on the view that the CRA could have contributed in any meaningful way to the current subprime crisis.

[...]

To gain further insight into the potential relationship between the CRA and the subprime crisis, we also compared the recent performance of subprime loans with mortgages originated and held in portfolio under the affordable lending programs operated by NeighborWorks America (NWA). As a member of the board of directors of the NWA, I am quite familiar with its lending activities. The NWA has partnered with many CRA-covered banking institutions to originate and hold mortgages made predominantly to lower-income borrowers and neighborhoods. So, to the extent that such loans are representative of CRA-lending programs in general, the performance of these loans is helpful in understanding the relationship between the CRA and the subprime crisis. We found that loans originated under the NWA program had a lower delinquency rate than subprime loans. Furthermore, the loans in the NWA affordable lending portfolio had a lower rate of foreclosure than prime loans. The result that the loans in the NWA portfolio performed better than subprime loans again casts doubt on the contention that the CRA has been a significant contributor to the subprime crisis.

The final analysis we undertook to investigate the likely effects of the CRA on the subprime crisis was to examine foreclosure activity across neighborhoods grouped by income. We found that most foreclosure filings have taken place in middle- or higher-income neighborhoods; in fact, foreclosure filings have increased at a faster pace in middle- or higher-income areas than in lower-income areas that are the focus of the CRA.

[aheadace]

ROWDY DO YOU KNOW WHO BUSH AND PAULSON ARE

[thethinker2]

It is interesting that McCullagh says that the AIG bailout should not have happened. He in no way postulates what would have happened to the economy without an AIG bailout or other bailouts of banks. What would the unemployment go to, how many businesses would fail, when, if ever, would the economy recover? Where are those projections Mr. McCullagh?

This is a typical tactic of people who have no responsibility whatsoever to anyone but themselves. Simply snipe at a solution by people who are responsible for their actions or inactions.

[aheadace]

I think Bush and Paulson should be in jail with Madoff

[truthseeker60]

AIG bailout is what most of the people on this blog have been screaming about for the last 6 months. Don't you just love the the Judgment in the civil suite that let the Media off the hook? ITS NOT AGAINST THE LAW TO LIE OR MISLEAD IN NEWS REPORTING.. Kinda of make a person long for the days of Woodward and Bernstien. We have plenty of ____ gates but no reporters with any balls to report the truth. They'll all be fired for not supporting the Media corp lies and propaganda.

[rsmik]

Somebody Stop The "Bailout Party"

make it byob, then nobody will come

[sogaman]

Facts just can't seem to get in the way here, goodday folks.

[megawhy]

johnb8888 said:

"Wooo, big surprise there, Repig shill!

FAct is, it's the Great Gods Raygun and Bushit who pretty much created this mess with their ending the government's policing role over the Walstreet pirates.

It's not surprising when coyotes rob henhouses. What's surprising is when the ranch dogs let them do it, or even join in the slaughter.

That is Reaganism, pure and simple.

And the "tinkle down" turned into a Golden Shower for regular Americans as Bushit's Billionaires took home huge payoffs and bonuses.

Reaganite Repigs should be put up against a wall in front of a firing squad for treason."

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

Let me ask a question. Does this stuff sound like facism? You see facists believe that the state should rule and any other thoughts are wrong. johnb8888 you make my case. This kind of hate language is what is at the core of liberalism and the Democratic Party. The funny thing is people like johnb point at the Republicans and accuse them of what the Democrats are! If this doesn't make my case then I am not sure what else I can do.

Thanks johnb8888 for being a good liberal and showing your balanced and true feelings! :-)

[sogaman]

OK time for a lesson in how our government works. Money is worth nothing unless there is something to back it up. Up until the early 60's our money was backed up by gold. But the great thinkers (congress) of the time ended that(and Bush was not there at the time believe it or not) Today when OUR government talks about spending, oh let's say a small amount, 1 trillion dollars -it does this by printing government bonds. But in order for this to work someone has to buy the trillion in bonds. Some of us(citizens) buy them, a few hundred here or there but there is billions left to go. Along comes good old China with their ( we just made 10 trillion form selling you idiots cheap stuff) purse open and they BUY all they can of OUR bonds. China now owns trillions of bonds each one good for the money printed on them. This has not a thing to do with what party you pull for, each bond earns interest- anyone who has bought a government bond or T-Bill knows this and counts on it. So China is setting there with trillions in bonds earning interest. Now guess who owe's this, WE DO!!! Enough Already! with the Bailouts! How's that for a 2 year business degree.

[megawhy]

hungry1968-15

Yes I agree I was Wrong about Obama when I thought he might possibly be a good President. Thank goodness I did not vote for him.

By the way, you really need to do a bit of homework rather than continuing to live in the world of emotionalism. North Korea just took two journalists, China confronted our Navy on the high seas, China is pushing to stop the dollar from being the universal currency, Russia is re-building its nuclear arsenal, and Iran has basically mocked Obama's weak, ineffective video. These things are in the news.

The quote I used came from the artical above and the numbers are substaniated. So where is the unsubstantialed drivel??

It is not hard to look at information and use one's head to analyze it and then use your heart to evaluate it. But you do have to use both your head and your heart to come to good conclusions. I invite you to try it..you might like it!

[johnb8888]

"The only tingly feeling I get with this administration is the kind that makes the hair on th back of my neck stand straight up. Never has an administration failed so fast and so early. I had tried to convince myself that Obama might be a good President after his disappointing win.....WOW was I WRONG
Posted by megawhy



Wooo, big surprise there, Repig shill!

FAct is, it's the Great Gods Raygun and Bushit who pretty much created this mess with their ending the government's policing role over the Walstreet pirates.

It's not surprising when coyotes rob henhouses. What's surprising is when the ranch dogs let them do it, or even join in the slaughter.

That is Reaganism, pure and simple.

And the "tinkle down" turned into a Golden Shower for regular Americans as Bushit's Billionaires took home huge payoffs and bonuses.

Reaganite Repigs should be put up against a wall in front of a firing squad for treason.

[megawhy]

tj217-2009

Gee I have an MBA from one of the top schools in the country. But I have found that degrees help train the mind, but they don't endow people with common sense or leadership ability. That comes from natural talent and experience. These are the things Obama is lacking. I am also beginning to question his level of intelligence. In the words from a great film, "Stupid is what Stupid does". Watching Obama and his "elite" group of advisors this is becoming soooooo apparent.

[jckbrn-2009]

What did Barney Frank do to cause this mess? Posted by hungry1968-15

If you really don't know, you need to do some research - -
There is a solution for the problems we face in gov't efforts to "represent teh people" -
Vote against every incumbent at every election - - we can provide term limits for every elected official (they certainly won't) - - - none of them are doing a good job for this nation - - regardless of "party affiliation" - - and that goes back for years, not just a recent development - - -