Randall Posted February 17, 2009 Share Posted February 17, 2009 from Time magazine Angelo Mozilo The son of a butcher, Mozilo co-founded Countrywide in 1969 and built it into the largest mortgage lender in the U.S. Countrywide wasn't the first to offer exotic mortgages to borrowers with a questionable ability to repay them. In its all-out embrace of such sales, however, it did legitimize the notion that practically any adult could handle a big fat mortgage. In the wake of the housing bust, which toppled Countrywide and IndyMac Bank (another company Mozilo started), the executive's lavish pay package was criticized by many, including Congress. Mozilo left Countrywide last summer after its rescue-sale to Bank of America. A few months later, BofA said it would spend up to $8.7 billion to settle predatory lending charges against Countrywide filed by 11 state attorneys #2 Phil Gramm As chairman of the Senate Banking Committee from 1995 through 2000, Gramm was Washington's most prominent and outspoken champion of financial deregulation. He played a leading role in writing and pushing through Congress the 1999 repeal of the Depression-era Glass-Steagall Act, which separated commercial banks from Wall Street. He also inserted a key provision into the 2000 Commodity Futures Modernization Act that exempted over-the-counter derivatives like credit-default swaps from regulation by the Commodity Futures Trading Commission. Credit-default swaps took down AIG, which has cost the U.S. $150 billion thus far. Quote Link to comment Share on other sites More sharing options...
westvirginia Posted February 17, 2009 Share Posted February 17, 2009 (edited) President Clinton's tenure was characterized by economic prosperity and financial deregulation, which in many ways set the stage for the excesses of recent years. Among his biggest strokes of free-wheeling capitalism was the Gramm-Leach-Bliley Act, which repealed the Glass-Steagall Act, a cornerstone of Depression-era regulation. He also signed the Commodity Futures Modernization Act, which exempted credit-default swaps from regulation. In 1995 Clinton loosened housing rules by rewriting the Community Reinvestment Act, which put added pressure on banks to lend in low-income neighborhoods. It is the subject of heated political and scholarly debate whether any of these moves are to blame for our troubles, but they certainly played a role in creating a permissive lending environment. Edited February 17, 2009 by westvirginia Quote Link to comment Share on other sites More sharing options...
westvirginia Posted February 17, 2009 Share Posted February 17, 2009 From the start, Bush embraced a governing philosophy of deregulation. That trickled down to federal oversight agencies, which in turn eased off on banks and mortgage brokers. Bush did push early on for tighter controls over Fannie Mae and Freddie Mac, but he failed to move Congress. After the Enron scandal, Bush backed and signed the aggressively regulatory Sarbanes-Oxley Act. But SEC head William Donaldson tried to boost regulation of mutual and hedge funds, he was blocked by Bush's advisers at the White House as well as other powerful Republicans and quit. Plus, let's face it, the meltdown happened on Bush's watch. Quote Link to comment Share on other sites More sharing options...
Jimmy Neutron Posted February 17, 2009 Share Posted February 17, 2009 There's plenty of blame to go around on this one. Picking and choosing contributors to the problem based on political affiliation is just flat ignoring what is obvious to most. The grand irony in all of this is the rightful democratic scorn toward Bush and the GOP house and senate for wreckless spending through '06. The dems fail to acknowledge that they failed to challenge Bush in any real way once they had control of the Hill and then along with Obama claim that the only way to get us out of this mess is to borrow and spend faster. Quote Link to comment Share on other sites More sharing options...
ABearWithFurniture Posted February 18, 2009 Share Posted February 18, 2009 1. Loaf Quote Link to comment Share on other sites More sharing options...
westvirginia Posted February 18, 2009 Share Posted February 18, 2009 1. Loaf I thought Puddy would be #1? :scratcheshead: Quote Link to comment Share on other sites More sharing options...
cre8tiff Posted February 18, 2009 Share Posted February 18, 2009 Funny how there is a thundering lack of moral outrage in THIS thread. Quote Link to comment Share on other sites More sharing options...
westvirginia Posted February 18, 2009 Share Posted February 18, 2009 Funny how there is a thundering lack of moral outrage in THIS thread. Oh I'm outraged, I'm just working out my alibi before I start shooting them... Quote Link to comment Share on other sites More sharing options...
Big John Posted February 18, 2009 Share Posted February 18, 2009 I thought Puddy would be #1? :scratcheshead: Puddy is the accountant. Quote Link to comment Share on other sites More sharing options...
bushwacked Posted February 18, 2009 Share Posted February 18, 2009 It's good to know you are on board with the fact that one of the major reasons for our crisis is because both Clinton and Bush turned a blind regulatory eye to the unethical free wheeling loan practices from the private industry. Quote Link to comment Share on other sites More sharing options...
Clubfoothead Posted February 18, 2009 Share Posted February 18, 2009 Anybody eaten a bird-$hit, rat-$hit, opossum $hit, rainwater peanut butter and jelly sandwich recently? Quote Link to comment Share on other sites More sharing options...
Big John Posted February 18, 2009 Share Posted February 18, 2009 Anybody eaten a bird-$hit, rat-$hit, opossum $hit, rainwater peanut butter and jelly sandwich recently? Peanut butter with the salmonella outbreak? Quote Link to comment Share on other sites More sharing options...
Clubfoothead Posted February 18, 2009 Share Posted February 18, 2009 Peanut butter with the salmonella outbreak? Yeah, it's the second one in two years. http://www.fda.gov/bbs/topics/news/2007/new01574.html Quote Link to comment Share on other sites More sharing options...
westvirginia Posted February 18, 2009 Share Posted February 18, 2009 It's good to know you are on board with the fact that one of the major reasons for our crisis is because both Clinton and Bush turned a blind regulatory eye to the unethical free wheeling loan practices from the private industry. Put your outrage to bed, Corky. My laughter was at Randull's portrayal, and the fact that there are plenty of people on both sides of the aisle contributing to this mess. But hey, you keep telling me I'm throwing my vote away voting FOR someone of principle rather than one of these corrupted folks. So I'm sure you'll sleep fine tonight. Quote Link to comment Share on other sites More sharing options...
TheShiznit Posted February 18, 2009 Share Posted February 18, 2009 Put your outrage to bed, Corky. My laughter was at Randull's portrayal, and the fact that there are plenty of people on both sides of the aisle contributing to this mess. But hey, you keep telling me I'm throwing my vote away voting FOR someone of principle rather than one of these corrupted folks. So I'm sure you'll sleep fine tonight. hit it right on the head....all politicians are to blame...all parties. Unless they spoke out, they were complicit....makes them all guilty but maybe one or two. Quote Link to comment Share on other sites More sharing options...
bushwacked Posted February 18, 2009 Share Posted February 18, 2009 Put your outrage to bed, Corky. My laughter was at Randull's portrayal, and the fact that there are plenty of people on both sides of the aisle contributing to this mess. But hey, you keep telling me I'm throwing my vote away voting FOR someone of principle rather than one of these corrupted folks. So I'm sure you'll sleep fine tonight. You're the one who quoted the 2 items in the article to make a point; and you always claim that less govt. is always "better" and more govt. is always "bad." Just because things aren't as simplistic as you've convinced yourself they are, it doesn't mean I'm happy with the way things are either. Quote Link to comment Share on other sites More sharing options...
Randall Posted February 18, 2009 Author Share Posted February 18, 2009 Put your outrage to bed, Corky. My laughter was at Randull's portrayal, and the fact that there are plenty of people on both sides of the aisle contributing to this mess. But hey, you keep telling me I'm throwing my vote away voting FOR someone of principle rather than one of these corrupted folks. So I'm sure you'll sleep fine tonight. What portrayal? All I did was state the title of the article. Anything else comes from your vivid if not lulu imagination. Ignore doesn't work when rational people quote you. Quote Link to comment Share on other sites More sharing options...
Randall Posted February 18, 2009 Author Share Posted February 18, 2009 Greenspan backs bank nationalisation By Krishna Guha and Edward Luce in Washington Published: February 18 2009 00:06 | Last updated: February 18 2009 00:06 The US government may have to nationalise some banks on a temporary basis to fix the financial system and restore the flow of credit, Alan Greenspan, the former Federal Reserve chairman, has told the Financial Times. In an interview, Mr Greenspan, who for decades was regarded as the high priest of laisser-faire capitalism, said nationalisation could be the least bad option left for policymakers. ”It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring,” he said. “I understand that once in a hundred years this is what you do.” Mr Greenspan’s comments capped a frenetic day in which policymakers across the political spectrum appeared to be moving towards accepting some form of bank nationalisation. “We should be focusing on what works,” Lindsey Graham, a Republican senator from South Carolina, told the FT. “We cannot keep pouring good money after bad.” He added, “If nationalisation is what works, then we should do it.” Speaking to the FT ahead of a speech to the Economic Club of New York on Tuesday, Mr Greenspan said that “in some cases, the least bad solution is for the government to take temporary control” of troubled banks either through the Federal Deposit Insurance Corporation or some other mechanism. The former Fed chairman said temporary government ownership would ”allow the government to transfer toxic assets to a bad bank without the problem of how to price them.” But he cautioned that holders of senior debt – bonds that would be paid off before other claims – might have to be protected even in the event of nationalisation. ”You would have to be very careful about imposing any loss on senior creditors of any bank taken under government control because it could impact the senior debt of all other banks,” he said. “This is a credit crisis and it is essential to preserve an anchor for the financing of the system. That anchor is the senior debt.” Mr Greenspan’s comments came as President Barack Obama signed into law the $787bn fiscal stimulus in Denver, Colorado. Mr Obama will announce on Wednesday a $50bn programme for home foreclosure relief in Phoenix, Arizona. Meanwhile, the White House was working last night on the latest phase of the bailout for two of the big three US carmakers. In his speech after signing the stimulus, which he called the “most sweeping recovery package in our history”, Mr Obama set out a vertiginous timetable of federal decisions in the coming weeks that included fixing the US banking system, submission next week of the 2009 budget and a bipartisan White House meeting to address longer-term fiscal discipline. “We need to end a culture where we ignore problems until they become full-blown crises,” said Mr Obama. “Today does not mark the end of our economic troubles… but it does mark the beginning of the end.” Copyright The Financial Times Limited 2009 Quote Link to comment Share on other sites More sharing options...
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