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Nope. Alan Greenspan was a big supporter of lending money to home
purchasers who couldn't afford it. In his book, "The Age of
Turbulence," Greenspan said:
"By 2006, nearly 69 percent of households owned their own home, up
from 64 percent in 1994 and 44 percent in 1940. The gains were
especially dramatic ... as increasing affluence as well as government
encouragement of subprime mortgage programs enabled many ... to
become first-time home buyers. This expansion of ownership gave more
people a stake in the future of our country and boded well for the
cohesion of the nation, I thought."
He also said, "I was aware that the loosening of mortgage credit terms
for subprime borrowers increased financial risk, and that subsidized
home ownership initiatives distort market outcomes. But I believe
then, as now, that the benefits of broadened home ownership are worth
the risk."
Well, Alan, look at us now.
From: Jim Ross <jrosscpa@xxxxxxx>
To: realtraders@xxxxxxxxxxxxxxx
Date: Wednesday, October 8, 2008, 8:54:00 AM
Subject: [RT] Time to end hedge funds?
** I don't recall hearing the outcries about lenders loaning money to
people who couldn't afford it two years ago. Even Greenspan was
cheering them on.**
Nope, factually the reverse:
Greenspan Urges Better Regulation of Fannie Mae and Freddie Mac
By STEPHEN LABATON
Published: April 6, 2005
WASHINGTON, April 6 - As Congress began again to work on legislation
to strengthen oversight of Fannie Mae and Freddie Mac, two of the
nation's largest mortgage finance companies, Alan Greenspan, the
Federal Reserve's chairman, urged lawmakers today to impose sharp
limits on the $1.5 trillion holdings of the companies.
http://www.nytimes.com/2005/04/06/business/06cnd-fannie.html?ex=1270440000&en=ab36e1cc1d563190&ei=5090&partner=rssuserland
Legislation was subsequently reported out of the Senate Banking
Committee to create a super regulator for FNMA/FRE. But, Barney Frank
(who was having an affair with one of the top execs in FNMA) and Chris
Dodd (who received more contributions from anyone from FMNA including
Obama) and a coalition of Democrats blocked and prevented a vote on
that legislation. Republicans could not break the deadlock created by
Democrats and gave up.
-----Original Message-----
From: realtraders@xxxxxxxxxxxxxxx [mailto:realtraders@xxxxxxxxxxxxxxx] On Behalf Of Code 2
Sent: Wednesday, October 08, 2008 11:42 AM
To: hbernst963@xxxxxxx
Subject: Re[2]: [RT] Time to end hedge funds?
I agree completely with your second paragraph, Howard, but not the
first. All the players you mentioned were simply reflecting the
public mood. The real blame goes to all of us who greedily bought
subprime- and option-ARM-financed houses (sometimes more than one)
speculating that rising prices would allow refinancing and sweet
profits. It was all of us who drew equity from our homes to buy new
Lincoln Navigators and speculate in the market. It was all of us who
spent more than we earned, expecting the gravy train to continue. The
regulators, lenders and Wall Street types just gave us what we
demanded. Funny how human nature is to blame everyone else for our
bad decisions.
I don't recall hearing the outcries about lenders loaning money to
people who couldn't afford it two years ago. Even Greenspan was
cheering them on.
Sometimes when you speculate, you lose. It's unfortunate. Whatever
happened to "buyer beware"?
From: hbernst963@xxxxxxx <hbernst963@xxxxxxx>
To: realtraders@xxxxxxxxxxxxxxx
Date: Wednesday, October 8, 2008, 6:35:40 AM
Subject: [RT] Time to end hedge funds?
There is a lot of blame to go around in this crisis. To blame it on the
government is ridiculous, IMO. There are many players in this- Wall Street
speculators, lax government supervision, mortgage lenders giving money to people
who couldn't afford to pay for houses, etc.
What we are seeing is a normal long term cycle of credit expansion and
collapse. See the depression of 1835-42, the Panics of 1873 and 1890 and of
course, 1929-1932.
Howard Bernstein
--
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