1999 Reports Showing Democrats Major Cause of Current Financial Crises
- on 10.03.08
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Barack Obama, Nancy Pelosi, Harry Reid, Barney Frank and the rest of the Democrats can continue to blame Bush, McCain and the Republicans for the current fiancial crisis, but more and more evidence mounts that the policies of the Democrats are a major part fo the cause. This story from 1999 in the NY Times. (Emphasis mine)
Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.
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”Fannie Mae has expanded home ownership for millions of families in the 1990’s by reducing down payment requirements,” said Franklin D. Raines, Fannie Mae’s chairman and chief executive officer. ”Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.”
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In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980’s.
