Obama the Pitchfork Operator: A Remake of the Soviet Classic
junyo just one question
“What was the default rate for the minority loans in minority areas and what was the default for the White loans in White or mixed areas?”
I have never anyone say that the default rates for minorities was LOWER then for others. If the Banks were requiring higher standards for minorities then their default rates would be lower. Sorry. Everything I heard was that they were about the same. Only when the government forced them to make more minority loans was there a difference. The default rates for minorities went higher. Bad loans cause that. That put a limit on the number of loans the banks could make. Losing money does that.
The Government stepped in and had Freddy and Fanny start buying loans from the banks. Then the Bankers could make any realistate loan and Freddy and Fanny would buy it form them. The Banks started making mone on the TRANSACTION not on the Loan Interest. The transaction had no risk. Make any loan sell it to F&F make money at no risk. So they made loans no sane Banker would because F&F were willing to buy loans that could never be payed back.
Start from forcing Banks to make Bad loans. The Banks can only have so many bad loans on their books. The Banks can’t sell them because they are bad loans. The Government steps in and F&F are happy to buy loans any loans. Good, bad, or insane. The Banks make Bad loans and sell them to F&F. The Minorities are happy, the Democrats are happy, ACORN is happy, the Government is happy. Everybody is happy until there are so many bad loans it can’t be hidden anymore. PUFF the Happy Times are gone.
