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Mel Watt on Fannie and Freddie - I want to go back to 2008

Bruce Krasting's picture




 

 

When Harry Reid (D-NV) changed the rules on how the Senate votes for a Presidential appointment, he opened the door for a critical change in the leadership at the Federal Housing Finance Authority (FHFA). In short order, the Administrations' pick for the job, Mel Watt, got the appointment that had been stalled for a year, and Ed DeMarco is out. Liberals hated DeMarco. And with good reason.

FHFA was formed when Fannie and Freddie went into receivership back in 2009. FHFA was tasked, by law, with one and only one mission:

 

Minimize losses to taxpayers from F/F

 

DeMarco succeeded in this mission. As of today, F/F have paid back virtually all of the bailout money they received in 2009 and 2010. By the end of 2014 the taxpayers will be in the black from the bailouts. How was this miracle achieved? Simple - F/F stopped making bad loans.

When I say 'bad loans' I mean mortgages that are not structured or priced right. A good mortgage loan is made to someone who has down-payment money and a job that pays enough to service the mortgage. The borrower must have a credit background that demonstrates that they are able and willing to make monthly payments. Not so complicated.

Mel Watt will take over the FHFA in January. But even before he finds where the bathroom is at his new job he is changing the rules. He stated on Friday that he wants to reduce fees to borrowers who do not have the 20% down-payment and for borrowers with lower credit scores.

 

wsj

 

Watt's statement is payback for the liberals/progressives who want to take F/F back to the status quo of 2008 and who supported Watt to that end. In 2008 the mortgage giants were agents of federal policy on housing. The 'mission' was to increase home ownership at any cost. As it turned out, the cost of achieving those goals damn near destroyed the global economy. And now Mel Watt wants to turn the clock back five years and make the same mistakes all over.

What is the intent of the fees that were scheduled to go into effect in March of 2014? The goal was to increase the costs of borrowing from F/F in the hope that private lenders would come into the mortgage market and take business away from F/F. The DeMarco plan was to shrink F/F over time, and get D.C. out of the mortgage business. His actions were consistent with his mandate - minimize taxpayer risks. Demarco's words:

 

"those fees should rise in order to allow private investors, which target a higher rate of return, to compete."

 

So this frames the political debate. The liberal side of the equation wants to subsidize the mortgage market and exclude private capital. They want to do this to achieve social objectives of home ownership and to make a small step toward wealth redistribution. Lofty and admirable goals. But the tradeoff is that F/F will get bigger and more dominant in the mortgage business. Their role in the economy will expand, not contract - and the USA is once again opening the door for another crisis. A crisis that will work completely contrary to the stated goals of leveling the economic playing field (as it did in 2008).

With Watt taking over, the die is cast. FHFA, Fannie and Freddie are turning a corner and headed in a new (old) direction. When Watt takes over on January 6 we will see a bunch of new measures that will confirm the change in strategy. Many will cheer those efforts. It will mean a bigger role for F/F. It means the USA is doing a u-turn back to 2008. And it means that someday we will have a problem again.

 

Note:

It's not only liberals who hated DeMarco. Those who speculated in Fannie and Freddie common and preferred shares did too. DeMarco passed a rule (no votes anywhere) that 100% of F/F's income would go to the government and not be used to pay off the borrowings that occurred in the bailout. DeMarco's policy is now subject to suits from various hedge funds. DeMarco's action put the holders of F/F stock behind a huge wall. In theory, those shares are worthless, as F/F were on a glide path to be wound-down to nothing.

Watt can't deliver on his promises to those who got him his new job and at the same time continue with a plan to shutter F/F. If the companies do have a different future with Watt running the show, does that mean that the pref stock has a future too?

These are the actors on this stage:

 

The Speculators:

carlyle

JP

The Carlyle Group prepares to launch its IPO

 

How do the specs feel about Watt?

 

images

 

 

The Good Guys??

 

WATT

 

&

 

CUMMINGS

 

Talk about strange bedfellows - this one takes the cake. I wonder who will prevail in the end??

 

gregory-maiofis-1

 

 

 

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Mon, 12/23/2013 - 02:18 | 4270145 steveo77
steveo77's picture

Parabolic rise in blacks appointed by bama, hmmm

most racist pres ever>?

Sun, 12/22/2013 - 12:28 | 4268438 SendMeYourWorth...
SendMeYourWorthlessMoney's picture

One can either believe facts or lies. Then again, as many people believe in ghosts as evolution...

If it had only been F&F, the whole housing market debacle wouldn't have been much more than a blip on the evening news. But it wasn't - it was the private banks that threw us onto the mat, another punching bag in the middle of a global financial crisis.

http://www.ritholtz.com/blog/wp-content/uploads/2011/11/fannieFreddie4.jpg

A study by the Federal Reserve shows that more than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions. The study found that the government-sponsored enterprises were concerned with the loss of market share to these private lenders — Fannie and Freddie were chasing profits, not trying to meet low-income lending goals.

...

http://www.ritholtz.com/blog/2011/11/examining-the-big-lie-how-the-facts...

I think his bet might still be on the table for anyone who can prove otherwise.

 

 

Sun, 12/22/2013 - 04:30 | 4268011 Quantum Nucleonics
Quantum Nucleonics's picture

Bruce is missing the scope of the scandal of having Watt running the FHFA.

First, the guy is totally unqualified.  By his own admission, he's ignorant of banking regulation. From a piece about his confirm hearing:

According to the article, On June 24, 2010, Mr. Watt asked at a Congressional conference committee: “Can somebody explain to me what’s in Tier 1 capital?” and “I just don’t have enough knowledge in this area to understand.” In December 2011 he said that, despite his Financial Services slot, “I didn’t know a damn thing about derivatives. I am still not sure I do.”

Second, it isn't just the fees, Watt is Team Obama's ticket back to no-down payment mortgages, cram downs, principal write offs, refinancing underwater mortgages at government expense, and more. The only thing that held them back was DeMarco. Liberals have a venom for that guy shared for few others.

A banking regulator that doesn't know what derivatives are. Yea, this is going to work out well. Can I get CDS pricing on AAA MBS?

Sun, 12/22/2013 - 08:59 | 4268087 tip e. canoe
tip e. canoe's picture

completely agree that it's much more insiduous than just the fees.  having Watt run the FHFA is like putting an ostrich in charge of the henhouse.

i give it until about May (when the C-S starts falling off a cliff) when the doors are blown wide open, black friday style.   right after the Goodfellas bust out from the rear loading dock and escape in an unmarked van with all the good loot.

Sun, 12/22/2013 - 12:41 | 4268458 moneybots
moneybots's picture

"completely agree that it's much more insiduous than just the fees.  having Watt run the FHFA is like putting an ostrich in charge of the henhouse."

 

What the FOX say

Sun, 12/22/2013 - 00:48 | 4267784 steveo77
steveo77's picture

parabolic rise in shark attacks around Hawaii as flotsam is detected also.

http://nukeprofessional.blogspot.com/2013/12/bubble-in-tiger-shark-attac...

Sat, 12/21/2013 - 22:46 | 4267533 Yen Cross
Yen Cross's picture

  Bruce crawls in his cave during the "London Whale" and "F/X fixing debacle" ? He hides during the commodities/debacle.

  You're a shill Bruce!  F/OFF!

Sat, 12/21/2013 - 19:09 | 4267170 Yancey Ward
Yancey Ward's picture

If Fannie and Freddie aren't wound down, then the preferred shares are legally worth something.

Sat, 12/21/2013 - 17:51 | 4267095 Lokking4AnEdge
Lokking4AnEdge's picture

If you like your Presidenr, you can keep your President...

Sun, 12/22/2013 - 04:46 | 4268022 Problem Is
Problem Is's picture

Don't Want Him, Can't Keep Him

There's no room for that fucktard. I've already got 2 Empty Suits, 3 Useful Idiots and 4 Loafers at work...

Sat, 12/21/2013 - 14:57 | 4266880 Freewheelin Franklin
Freewheelin Franklin's picture

Mel Watt. He was the one that fought the Paul-Grayson Amendsment to Dodd-Frank, which was the Audit the Fed Amendment. He's in BoA's pocket. BoA corporate is in his Congressional district. 

Sat, 12/21/2013 - 15:24 | 4266915 tip e. canoe
tip e. canoe's picture

and let's continue with the train of logic:

more fees = less mortgage applications

less mortgage apps = less origination fees for BoA

less fees = less profits

less profits = less lobbying fees

less lobbying fees = less dinners at 4 star restaurants for Mel

and this is a surprise to anyone?

Sat, 12/21/2013 - 18:31 | 4267137 new game
new game's picture

summation: warm body, pen with ink, fee grabing entities and a 30 year financable product(and financed-very important-commisions and fees on six digits amounts) and walla, the perfect commissionable, feeable situation that everyone wants - a home! add all tip e said and the games will continue round two that is the "echo bubble".

i was a 20+ yr r.e. broker...

Sat, 12/21/2013 - 14:36 | 4266862 csmith
csmith's picture

The eventual outcome of well-intended government policies is ALWAYS the exact reverse of those intentions. The corollary is that power and money-hungry pols will ALWAYS find a way to pervert the system to their benefit.

Sat, 12/21/2013 - 14:23 | 4266844 apberusdisvet
apberusdisvet's picture

The HOUSING/MORTGAGE CRISIS was a planned event; just understand that MERS, the criminal facilitator of  the whole MBS scheme was established in 1995, long before the housing bubble.

Sat, 12/21/2013 - 14:44 | 4266869 csmith
csmith's picture

MERS was no more directly responsible for the mortage fiasco than the internet itself is "responsible" for viruses and on-line fraud. MERS was a tool for streamlining the mortgage market, potentially making it more transparent and liquid. It could be used for evil or good. Some originators/lenders/servicers decided to use it to commit fraud more "efficiently".

Sun, 12/22/2013 - 13:17 | 4268548 Attitude_Check
Attitude_Check's picture

MERS was sst up to avoid paper records and filing fees.  Now why would the banks want to have all the records under thier control? Control fraud comes to mind eh?

Sat, 12/21/2013 - 15:48 | 4266939 Papasmurf
Papasmurf's picture

What could serve lenders and homeowners better than properly recording liens and deeds at the county courts?  MERS was not about streamlining, it was about covering trails and facilitating fraud.

Sat, 12/21/2013 - 14:33 | 4266855 FeralSerf
FeralSerf's picture

MERS was an enabler of trillion dollar theft, just as the Patriot Act is an enabler of state terrorism against its citizens.

Clinton's partnership with the NAR on the partial elimination of taxation of residential housing profits was another enabler.

Sat, 12/21/2013 - 13:37 | 4266751 wonderatitall
wonderatitall's picture

where was clinton ? oh , monica.  good to keep this in 2008 we wouldnt want hillary invovled with this. never forget, bush is bad but clinton and bawney frank started it. end the usa and the fed

Sun, 12/22/2013 - 00:06 | 4267719 brettd
brettd's picture

Where was Clinton?

Franklin Raines ring a bell?

 

Sat, 12/21/2013 - 14:28 | 4266852 FeralSerf
FeralSerf's picture

It amazes me how much Americans, especially the so-called "Christians", think what Clinton does with his penis has any importance.

Note to idiots: the President has the constitutional right to use his penis or otherwise engage in sexual relations in any lawful manner. Sex with another consenting adult of either sex is lawful in the U.S.

Clinton's demonstration of the use of state terrorism in Waco and Oklahoma City, on the other hand, was not a constitution right. It was a capital crime. Bush/Cheney somehow believed they could get away with similar crimes against humanity for fun and profit. That, and preceding similar lesser crimes like JFK's murder and Vietnam, are the root causes of America's decline into oligarchical despotism. America is ruled by criminals. They lie, they cheat, they steal, and they kill.

Many more innocents, likely millions of them, will be sacrificed before this awful phase has completed its cycle.

Sun, 12/22/2013 - 13:14 | 4268537 Attitude_Check
Attitude_Check's picture

Using his penis in the oval office with a subordinate employee is clearly not his right.  If a military officer did that he would be courtmartialed. If a CEO did that in the company office he would be fired and possibly charged with sexual harassment even if it was consensual.  The fact that Clinton showed his level of narcissism is relevent.  How far would he be willing to sell out the US or Constitution for his own benefit.  I find it amazing so many folks dont understand this connection between Monica Lewinsky and the other issues you raise.

Sat, 12/21/2013 - 14:59 | 4266884 Sir Edge
Sir Edge's picture

+100...Bravo...

Very few Americans have the moral strength to admit that our Presidents and Congress... this nation... commits ongoing war crimes and crimes against humanity and has done so for over 50+ years... non stop...

Edgey...

Sat, 12/21/2013 - 17:37 | 4267084 Element
Element's picture

 

 

" ... Was there a rule then that said you shouldn't bomb, shouldn't kill, shouldn't burn to death 100,000 civilians in a night?  Lemay said, if we'd lost the war, we'd all have been prosecuted as war-criminals - and I think he's right!  He, and I'd say I, were behaving as war-criminals. ..."
 
- Robert S. McNamara, former US Sec of War ('Defense')

Sat, 12/21/2013 - 14:19 | 4266831 moneybots
moneybots's picture

"where was clinton ? oh , monica.  good to keep this in 2008 we wouldnt want hillary invovled with this. never forget, bush is bad but clinton and bawney frank started it"

 

Started what?  Greenspan is ground zero of the housing bubble.

It was Greenspan that took lending standards to ZERO.  It was Greenspan that took the FED rate to near ZERO.  It was Greenspan who told home buyers to get adjustable rate mortgages.  Krugman noted it was Greenspan that needed a housing bubble to replace the .com bubble.

 

Sun, 12/22/2013 - 11:59 | 4268389 francis_the_won...
francis_the_wonder_hamster's picture

Greenspan was barely alive when the fraud began.  It goes back to FDR....aka the worst President EVER.....until, possibly 2009.

The CRA was probably the next major step, and that wasn't Greenspan either.

Greenspan played his role, to be sure, but he was late to the game.

Sun, 12/22/2013 - 12:47 | 4268468 moneybots
moneybots's picture

"Greenspan was barely alive when the fraud began.  It goes back to FDR....aka the worst President EVER.....until, possibly 2009.

The CRA was probably the next major step, and that wasn't Greenspan either.

Greenspan played his role, to be sure, but he was late to the game."

 

It was Greenspan's game all along.  Krugman noted  that Greenspan needed a housing bubble, not FDR or the CRA.

All financial roads lead to the FED.

Mon, 12/23/2013 - 01:59 | 4270125 francis_the_won...
francis_the_wonder_hamster's picture

"All financial roads lead to the FED."

Well there is no way I'm going to argue that (accurate) point.  What I'm saying is that the Fed was created 100 years ago, but it took them a good 20 years to put together, with the help of certain progressives (FDR and his legacy), the takeover of the housing/finance markets.

I really wish I could post a graph that demonstrates how the cost of housing started taking a bigger chunk out of the average American's pie beginning in 1933-4.  And no, it had nothing to do with scarcity (OK, very little).  We all know the arguements of why gov't likes docile homeowners, why Democrats like redistribution and housing for everyone, etc...

At the end of the day, the 3 biggest expenses most Americans face are housing, healthcare, and retirement.  By forcing the cost of housing up for 80 years, you increase that part of the pie, necessarily decreasing the size of the healthcare and retirement pies.  Remind me, exactly which two areas are going to be most responsbile for the US going bankrupt?  Oh yeah, social security and medicare.

And yes, the banksters, more specifically the Fed, orchestrated the whole damn thing.

Reason 1A why I'm soon to become an Ex-pat.

But as much blame as you deservedly put on Greenspan, he was not the originator.

 

Sat, 12/21/2013 - 13:39 | 4266750 moneybots
moneybots's picture

"It means the USA is doing a u-turn back to 2008. And it means that someday we will have a problem again."

 

It is a game of wash, rinse, repeat.  Auto loans are the new sub prime.  The game is moved to a new venue, once the old game is up.  William Black said that the Jobs Bill moved fraud from debt into equities.  The average person, raising a family, is oblivious to it, as they have other things to worry about.  When sub prime auto loans blow up or when investors get burned by provisions in the Jobs Bill, the cry will once again be that no one saw it coming.

I can see it coming, plain as day.  The mass media could too, if they wanted to keep the people informed about the truth.  Unfortunately, they don't.

Sun, 12/22/2013 - 07:55 | 4268137 Pee Wee
Pee Wee's picture

How to bullshit Congress:  No one sees that no one saw or will see a thing in advance or behind.

 

Sun, 12/22/2013 - 07:58 | 4268136 Pee Wee
Pee Wee's picture

Dup.

 

Sat, 12/21/2013 - 16:40 | 4267017 John_Coltrane
John_Coltrane's picture

"The game is moved to a new venue, once the old game is up."

So, true.  And the name of the game is always and forever, debt, followed by bailouts.  And debt is the road to serfdom (Hayak).  That's all anyone needs to keep in mind as the "game" apparently changes.  Since 1913 its always been about how to create more debt and thus less freedom.  Fake Wars (I, II, Korea, Vietnam, Iraq) and the social welfare state enable the debt (the users), while the banksters provide the drugs and act at the pushers.  Really, it all started a lot before 1913 as anyone who has read The Creature from jeckyl Island knows.  This book needs to required reading for anyone who wants to understand "finance".

The filibuster rule change was all about getting Yellen and Watts appointed.  Wouldn't have happened otherwise.  Why are these creatures still alive? 

Sat, 12/21/2013 - 13:15 | 4266711 Rainman
Rainman's picture

Healthcare, housing, skools, international relations, gubmint spending, markets....the kleptocrats are running out of things to terminally fuck up. Now they must move us foarward with reruns of old bad policies. Not to worry...Chairsataness is coming to the rescue soon !

Sat, 12/21/2013 - 13:08 | 4266697 ebworthen
ebworthen's picture

It's simple.

Politician's push for easier loan conditions to buy votes.

Bankers agree because they can make fee and commission money making the loans then securitizing them (CDS's & MBS's).

When the SHTF Politicians bail out banks with taxpayer money.

All this time legions of wonks and mandarins are drawing fat salaries 4X to 20X the mean.

No Fiduciary responsibility for the banks and politicians voted back into office for selling out taxpayers.

When you pay that exorbitant health insurance premium and earn 0.10% on any money you might have in savings you know who to thank.

Nice to see you Bruce. 

The short answer is to dismantle Fannie/Freddie and end the FED.

Sun, 12/22/2013 - 00:06 | 4267724 brettd
brettd's picture

And Bruce is baffled that 

some of us want smaller govt.....Oye. 

Sat, 12/21/2013 - 17:03 | 4267051 ThirdWorldDude
ThirdWorldDude's picture

Not just the FED, it wouldn't do the trick as the fuckers will be back in a couple of years and create a new FED (a-la 1816, 1863 and 1913)!

Instead. end all CB's of the world, trial and hang all their members together with their corrupt politician whores for treason, organised crime and crimes against humanity. Then put a large statue of a hanged banker/politician on every major square aroung the globe.

It might be a good start...

Sat, 12/21/2013 - 12:59 | 4266681 moneybots
moneybots's picture

" In 2008 the mortgage giants were agents of federal policy on housing. The 'mission' was to increase home ownership at any cost. As it turned out, the cost of achieving those goals damn near destroyed the global economy."

 

Alan Greenspan's goal of creating a housing bubble, to replace the .com bubble, crashed the economy in 2008.

The horse leads the cart, not the other way around.

Freddie and Fannie may have had a role in what happened, but they were not ground zero, Greenspan was.

Sun, 12/22/2013 - 11:16 | 4268331 max2205
max2205's picture

F and F are and were nothing but a 'bad bank'....like so many money pits in our govt system

Sat, 12/21/2013 - 12:44 | 4266652 Bruce Krasting
Bruce Krasting's picture

You're right that this started happening under Bush the JR. After 911 he had a war and a sagging economy. What better way to provide a stimulant and a distraction then to put some gas in the real estate tank. Make everyone 'feel' better.

But GB was not doing this as a liberal who had income/wealth redistrobution in mind. He had other motives. He made this (odd) comment about F/F and homeland security:

"Economic security at home is just an important part of -- as
homeland security. And owning a home is part of that economic security."

Sun, 12/22/2013 - 13:07 | 4268515 Jay
Jay's picture

Federal govt. pressure to increase home ownership began under Clinton.

http://www.nytimes.com/1999/09/30/business/fannie-mae-eases-credit-to-ai...

Sun, 12/22/2013 - 13:10 | 4268483 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

In the early 2000s Dubya endeavored to get gubmint out of the mortgage business through efforts to fully privatize the GSAs, working with Congressmen such as Richard Baker of Louisiana in that regard.  Of course, having gubmint in the huge mortgage business leads to hideous mis-allocations of capital followed by bank insolvencies followed by even more statism in the form of TBTF shit, as we all now know very clearly.

Dubya had the right idea.  He was defeated by the statists and in the end was indiscernable from them.  That is pretty much his story, IMO.  Changed his spots, wound up looking rather ugly.

Sat, 12/21/2013 - 22:53 | 4267564 dark pools of soros
dark pools of soros's picture

holy god haven't everyone put it together yet that liberals/conservatives do the same shit and just their fans yap about only doing one side of the coin??   Clinton pushed through NAFTA for fucks christ...  Bush rolled in benefits to gays... Obama is a warmonger than hates your privacy..

 

in fact they probably do MORE for the other side when they are in since that makes for less riots cause well 'it's our guy, so I guess we can't hate him too much for that..' mentality

Sat, 12/21/2013 - 13:51 | 4266771 the grateful un...
the grateful unemployed's picture

he started a war. he also ignored what Bob Novak told him, forget the Liberal stock pickers and create an economy conducive to business.

i consider W Bush closest to FDR. both were globalists. most of us forget W's immigration plan, which Democrats agreed on, which was blocked by house Republicans. anyone who smacks down FDR over SSN and the New Deal should take a hard look at W's legacy (now Obamas) what is ZIRP if it isn't a housing subsidy? it may be that the big banks enjoy most of the advantages of QE, but it also works for the credit dependent consumer.

and Obama can chirp at Bernanke's legacy, (he could have ask for change, that word?) because Bush appointed him, and brought him into cabinet meetings, and took him on foreign trips (all of which took away Feds independence). Bernanke also sat in with Paulson when they did their criminal cramdown on BofA shareholders. Greenspan probably never thought that was part of the job description.

to me F/F is or was just a place to park off balance sheet toxic investments, when they got too hot, the Fed took over. and if we end the Fed, UST will return to off balance sheet accounting, which was another Bush legacy from the Iraq war. the corporate government alliance is about 90% complete, partisan distinctions between public and private housing policy are trivial.

Sat, 12/21/2013 - 13:22 | 4266723 moneybots
moneybots's picture

But GB was not doing this as a liberal who had income/wealth redistrobution in mind. He had other motives. He made this (odd) comment about F/F and homeland security:

"Economic security at home is just an important part of -- as
homeland security. And owning a home is part of that economic security."

 

Krugman noted that Greenspan needed a housing bubble to replace the .com bubble.  A bubble has to be replaced by a bigger bubble to keep the game going.  Soveriegn debt bubble replaced the housing bubble, as the government has the capacity to borrow unlimited amounts of money.

I guarantee you that Bush was not the one who came up with the Ownership Society.  Just look how he sat in that school room for 7 minutes after he was informed of the second plane.  The ownership Society likely came out of the mind of Greenspan, in order to help foster the housing bubble, through government support.

Also the Bush administration successfully sought to prevent state attorney generals from prosecuting predatory lending, which was another facet of boosting a housing bubble.  Greenspan had taken lending standards to ZERO and the government was taking prosecution of lenders to ZERO.

In September 2004, the FBI warned congress of massive mortgage fraud.  Nothing was done about it.  That same year, the SEC gave the investment banks leverage waivers.

 

Sat, 12/21/2013 - 15:12 | 4266896 Blano
Blano's picture

"Just look how he sat in that school room for 7 minutes after he was informed of the second plane."

Not to defend the guy necessarily, but if you were sitting in front of a bunch of kindergarteners and was told the nation was under attack, what would YOU do??

It wasn't a time for deep thinking.  He knew he had to keep his cool regardless of what was going on.  W also mentioned later he didn't want to freak anybody out in the classroom, especially the kids.  All things considered, he handled himself pretty well in those first few moments.

Just sayin'.

Sat, 12/21/2013 - 17:36 | 4267080 moneybots
moneybots's picture

"Not to defend the guy necessarily, but if you were sitting in front of a bunch of kindergarteners and was told the nation was under attack, what would YOU do??"

The first thing i would have wanted to do was get out of that classroom, so i could start getting involved in what was going on.

It wouldn't have taken but a moment to have politely excused himself from the classroom. 

Apparently, his aides wanted him to remain sitting there, but he should have disregarded their direction.

Sat, 12/21/2013 - 14:06 | 4266805 the grateful un...
the grateful unemployed's picture

several greenspan bullet points over that period 1) liberalize immigration in order for america to find the labor it needs 2) develop natural gas 3) make housing affordable, while Bernanke is strictly a monetarist, Greenspan had a broad social agenda (primarily Republican). so if you want to lay the housing bubble on him, more power to you. if on the other hand you think you can do that, and not promote a wealth redistribution, you're wrong. Bernanke is probably less political than Greenspan, although he has achieved a wealth redistribution which he does not recognize, because he is apolitical that effect is largely a result of policy planks laid done before he was appointed

Sat, 12/21/2013 - 12:13 | 4266583 the grateful un...
the grateful unemployed's picture

let's not forget George Bush and the ownership society (was he a liberal?) but as i understand it the problem in 2008 began with the entities who originated the loans, and then dumped them onto F/F's books. F/F was a toxic waste dump for bad paper, while the Mozillas got rich. that all began with Greenspan who thought homeowners could have their equity and invest it too. poor Harry Reid, he is a chump, and a partisan chump. if you want to shout bad liberal, go get on the Rush Limbaugh show.

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