Come on Max don't start the indirect consequences brouhaha. The Affordable Housing Scam dates only back to the late Clinton Administration. Yes these government subsidized corporations were extablished in late depression days but they didn't start bundling bad loans until much later.
This from Wikipedia
Quote:
Concerns with business and accounting practices at Fannie Mae predate the scandal itself. On June 15, 2000, the House Banking Subcommittee On Capital Markets, Securities And Government Sponsored Enterprises held hearings on Fannie Mae [5].
On December 18, 2006, U.S. regulators filed 101 civil charges against chief executive Franklin Raines; chief financial officer J. Timothy Howard; and the former controller Leanne G. Spencer. The three are accused of manipulating Fannie Mae earnings to maximize their bonuses. The lawsuit sought to recoup more than $115 million in bonus payments, collectively accrued by the trio from 1998–2004, and about $100 million in penalties for their involvement in the accounting scandal.
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The very fact these two entities were government subsidized lent them credence in the mortgage loan business. Raines and company really started ripping off the corporations(to the tune of Millions of $s) and profiting from actions of Congress during previous administrations.encouragement to put more people into the home ownership category.i.e. bonuses for greater loan volume.Bundling bad risk loans with good risk loans and rendering them as government OKd?.Raines is even on Obamas campaign committee? If Obama wins will he be in the Cabinet? How about as Sec of the Treasury?
Several Years back (2004) the House held hearings on the ascending scam. There are video clips from the hearings that show some Repubs warning the House and looking for oversight but these same clips show Rep Frank, Waters., Meeks and Davis(among others) saying there was no problem. Meeks even publicly castigates a so called regulator and comments he is "pissed Off" about trying to regulate these two honorable corporations?
It turns out that many members of the House(Repub and Democrat) got contributions from Fannie Mae? And many House members had purchased shares in Fannie Mae and Freddie Mac? Conflict of interest? I'd say so, wouldn't you.
I challenge your attempt to pass the blame around? The crash could have been prevented in 2004/2006 when the problem was discussed in our law making body. A sufficient number of thes crooks ducked it and assured us all things were fine. Then the housing slump of 2007 blew the scam wide open. The blame is easily fixed, isn't it?
Check out this letter signed by John McCain giving ample warning of what might happen unless congress acted. Notice no Democrat was involved.
McCain Letter Demanded 2006 Action on Fannie and Freddie - HUMAN EVENTS