Daily Motivations - 20081006

"Daily Motivations"

There are as many ways to recognize people as there are people to recognize. You just have to use your brain to find them. Next time you think you've exhausted the possibilities, think again…and again! -- Eric Harvey



"The Patriot Post"
"No man in his senses can hesitate in choosing to be free, rather than a slave." --- Alexander Hamilton


"No people will tamely surrender their Liberties, nor can any be easily subdued, when knowledge is diffusd and Virtue is preservd. On the Contrary, when People are universally ignorant, and debauchd in their Manners, they will sink under their own weight without the Aid of foreign Invaders." -- Samuel Adams


"For the same reason that the members of the State legislatures will be unlikely to attach themselves sufficiently to national objects, the members of the federal legislature will be likely to attach themselves too much to local objects." -- James Madison



"CBN.com"

http://www.cbn.com/CBNnews/359202.aspx

Hamas Political Advisor: "We like Mr. Obama and we hope he will win the election"

April 17, 2008

Barack Obama is looking for as much support as he can get. But he doesn't need this support. The main political advisor to the Prime Minister of Hamas, Ahmed Yousef said the following in an interview the other day with World Net Daily and WABC radio host John Batchelor.

"We like Mr. Obama and we hope he will win the election."

"He has a vision to change America."



"The email Bag"

Sent: Wednesday, October 01, 2008 8:49 AM
Subject: more info on questionable loans

In 2005 John McCain cosponsored a bill to deal with mortgage problems at Fannie MAE & Freddie MAC.

Senator John McCain warned of the problems with the mortgage market in 2005. He cosponsored a bill (Senate Bill 190, 109th Congress, 2005-2006)
to improve oversight of Freddie MAC and Fannie MAE.
It was stopped by Democrats & good old boy GOP types.


From: http://www.govtrack.us/congress/bill.xpd?bill=s109-190
http://www.govtrack.us/congress/bill.xpd?bill=s109190&tab=summary&page-command=print

2005-2006 (109th Congress)
S. 190 [109th]: Federal Housing Enterprise Regulatory Reform Act of 2005


Sponsor:
Sen. Charles Hagel [R-NE]
Cosponsors [as of 2007-01-08]
Sen. Elizabeth Dole [R-NC]
Sen. John McCain [R-AZ]
Sen. John Sununu [R-NH]

A bill to address the regulation of secondary mortgage market enterprises, and for other purposes.

Status: Introduced - Jan 26, 2005 - Reported by Committee
-
Voted on in Senate
-
Voted on in House
-
Signed by President
-
This bill never became law. This bill was proposed in a previous session of Congress. Sessions of Congress last two years, and at the end of each session all proposed bills and resolutions that haven't passed are cleared from the books.
Last Action:

Jul 28, 2005: Committee on Banking, Housing, and Urban Affairs. Ordered to be reported with an amendment in the nature of a substitute favorably.

Congressional Research Service Summary

The following summary was written by the Congressional Research Service, a well-respected nonpartisan arm of the Library of Congress. GovTrack did not write and has no control over these summaries.

1/26/2005--Introduced.

Federal Housing Enterprise Regulatory Reform Act of 2005 -
Amends the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 to establish: (1) in lieu of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development (HUD), an independent Federal Housing Enterprise Regulatory Agency which shall have authority over the Federal Home Loan Bank Finance Corporation, the Federal Home Loan Banks, the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac); and (2) the Federal Housing Enterprise Board.

The Greenlining Institute: Does the financial crisis have its origins in Berkeley?

Tue, Sep 30, 2008 at 7:44 pm

Yesterday I followed a link to a new article by Matthew Vadum which named The Greenlining Institute (among similar nonprofits) as the actual cause of the current financial crisis threatening the US economy. I did a double-take: The Greenlining Institute? You mean the one in Berkeley? Answer: Yes. The very same.

I (and countless other people) often zip past the nondescript office on Berkeley’s University Avenue containing the Greenlining Institute — one passes it on the way in and out of the city, as University leads from the freeway to downtown and the U.C. campus.

Unlike most people, though, several months ago I took note of the office as I passed it one day, and asked myself, “The Greenlining Institute” — what the hell is that? When I got home, out of curiosity I googled it and spent a couple minutes trying to decipher their Web site, to little avail. A very few other scattered articles seemed to indicate that the Greenlining Institute existed solely to bully banks and financial institutions into giving loans to otherwise unqualified minority borrowers.

The Greenlining Institute’s own mission statement says,

The Greenlining Institute’s mission is to empower communities of color and other disadvantaged groups through multi-ethnic economic and leadership development, civil rights and anti-redlining activities.

…but Matthew Vadum puts it much more bluntly:

Financial Affirmative Action

When the history of the Great Economic Meltdown of 2008 is written, in-your-face shakedown groups like the Greenlining Institute will be held to account.

Greenlining, headquartered in Berkeley, California (where else?), is a left-wing pressure group that threatens nasty public relations campaigns against lenders that refuse to kneel before its radical economic agenda. Its principal goal is to push politicians and the business community to facilitate “community reinvestment” in low-income and minority neighborhoods.

The Greenlining name is a play on the unlawful practice of “redlining.” That’s when financial institutions designate areas, typically those with a high concentration of racial minorities, as bad risks for home and commercial loans. The Institute wants banks to give a green light to loans in these areas instead.

Recently profiled by John Gizzi, Greenlining uses carrot-and-stick tactics to blackmail public agencies, banks, and philanthropists to achieve its objectives. The Institute brags it has threatened banks into making more than $2.4 trillion in loans in low-income communities.

On a trip through Berkeley today I once again noticed the office, and this time stopped to take these pictures. But there was no news to be found there: just a building, with no one around. And I’m not the kind of person to just walk right in and ask to interview someone. Not that it would have done me much good: undoubtedly I would have been given the usual rigamarole about unfair housing and the need to redistribute wealth to help minorities.

There’s been a lot of finger-pointing on all sides about this financial crisis, but much of it misses the point. The off-topic details about CEO salaries and bond markets and mergers and bailouts and who voted for what all chase the horse after it’s already left the barn. The key question is this:

Once upon a time, banks only loaned money to individuals who could qualify for a home mortgage; and then sometime recently, they changed their practices and started loaning money to a lot of people who didn’t qualify and could not afford to pay back the loans. And when they started defaulting, and when real estate values starting dropping, the entire industry collapsed, because there was no equity to pay back the loans. The banks lost money, the customers lost money, and it all went down the toilet. Which, of course, many people had predicted. So the question is: Why? Why did banks start making countless risky untenable loans to unqualified customers?

And the answer is: Because they were afraid of being called racists by the legal bullies at the Greenlining Institute and other similar “community organizers.”

It all started with The Community Reinvestment Act, a federal law originally passed during the Carter administration and then ramped up during the Clinton years, that was originally designed to prevent racist lending practices by banks who wouldn’t loan money to minorities, even if they were qualified. But over time the law was twisted to force banks to make loans to minorities even if they weren’t qualified — which all may sound very peachy keen in Fantasy Utopia Land but which inevitably spells long-term financial suicide for a bank.

The Greenlining Institute’s self-appointed role is to identify those banks which by Greenlining’s reckoning haven’t doled out enough money to underqualified minority borrowers, and then threaten them with lawsuits, protests, and accusations of institutional racism if the banks don’t start opening their wallets ASAP. And the banks caved. Greenlining brags that they have unparalleled access to banking boardrooms, and they successfully squeezed $2.4 trillion (yes, trillion) in “CRA commitments” (i.e. loans to unqualified borrowers) out of terrified banks. Nearly every bank and financial institution you’ve ever heard of seems to kowtow to Greenlining.

Who are these people? And how did they gain so much power, while flying so far under the radar? Their latest push is to force the banks to convert the adjustable rate mortgage loans given to dodgy borrowers into fixed-rate loans, which would further punish the banks financially.
The American Anachronism blog lists some of the other pressure groups who bully banks — including the now notorious ACORN.

I don’t have any answers. Just a lot of questions. And a queasy feeling that there may be a lot more to the financial crisis than we’ve been told.

Further reading:The Greenlining Institute: Shakedown Artists, also by Matthew Vadum



"Boston Globe"

http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/09/28/franks_fingerprints_are_all_over_the_financial_fiasco/

Frank's fingerprints are all over the financial fiasco
By Jeff Jacoby

Globe Columnist / September 28, 2008

'THE PRIVATE SECTOR got us into this mess. The government has to get us out of it."

That's Barney Frank's story, and he's sticking to it. As the Massachusetts Democrat has explained it in recent days, the current financial crisis is the spawn of the free market run amok, with the political class guilty only of failing to rein the capitalists in. The Wall Street meltdown was caused by "bad decisions that were made by people in the private sector," Frank said; the country is in dire straits today "thanks to a conservative philosophy that says the market knows best." And that philosophy goes "back to Ronald Reagan, when at his inauguration he said, 'Government is not the answer to our problems; government is the problem.' "

In fact, that isn't what Reagan said. His actual words were: "In this present crisis, government is not the solution to our problem; government is the problem." Were he president today, he would be saying much the same thing.

Because while the mortgage crisis convulsing Wall Street has its share of private-sector culprits -- many of whom have been learning lately just how pitiless the private sector’s discipline can be -- they weren't the ones who "got us into this mess." Barney Frank's talking points notwithstanding, mortgage lenders didn't wake up one fine day deciding to junk long-held standards of creditworthiness in order to make ill-advised loans to unqualified borrowers. It would be closer to the truth to say they woke up to find the government twisting their arms and demanding that they do so - or else.

The roots of this crisis go back to the Carter administration. That was when government officials, egged on by left-wing activists, began accusing mortgage lenders of racism and "redlining" because urban blacks were being denied mortgages at a higher rate than suburban whites.

The pressure to make more loans to minorities (read: to borrowers with weak credit histories) became relentless. Congress passed the Community Reinvestment Act, empowering regulators to punish banks that failed to "meet the credit needs" of "low-income, minority, and distressed neighborhoods." Lenders responded by loosening their underwriting standards and making increasingly shoddy loans. The two government-chartered mortgage finance firms, Fannie Mae and Freddie Mac, encouraged this "subprime" lending by authorizing ever more "flexible" criteria by which high-risk borrowers could be qualified for home loans, and then buying up the questionable mortgages that ensued.

All this was justified as a means of increasing homeownership among minorities and the poor. Affirmative-action policies trumped sound business practices. A manual issued by the Federal Reserve Bank of Boston advised mortgage lenders to disregard financial common sense. "Lack of credit history should not be seen as a negative factor," the Fed's guidelines instructed. Lenders were directed to accept welfare payments and unemployment benefits as "valid income sources" to qualify for a mortgage. Failure to comply could mean a lawsuit.

As long as housing prices kept rising, the illusion that all this was good public policy could be sustained. But it didn't take a financial whiz to recognize that a day of reckoning would come. "What does it mean when Boston banks start making many more loans to minorities?" I asked in this space in 1995. "Most likely, that they are knowingly approving risky loans in order to get the feds and the activists off their backs . .. . When the coming wave of foreclosures rolls through the inner city, which of today's self-congratulating bankers, politicians, and regulators plans to take the credit?"

Frank doesn't. But his fingerprints are all over this fiasco. Time and time again, Frank insisted that Fannie Mae and Freddie Mac were in good shape. Five years ago, for example, when the Bush administration proposed much tighter regulation of the two companies, Frank was adamant that "these two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis." When the White House warned of "systemic risk for our financial system" unless the mortgage giants were curbed, Frank complained that the administration was more concerned about financial safety than about housing.

Now that the bubble has burst and the "systemic risk" is apparent to all, Frank blithely declares: "The private sector got us into this mess." Well, give the congressman points for gall. Wall Street and private lenders have plenty to answer for, but it was Washington and the political class that derailed this train. If Frank is looking for a culprit to blame, he can find one suspect in the nearest mirror.