flataffect – here is the time line – it took some digging to get the facts. I agree, Obama and the whole pack of them are lying through their teeth.
April 2001 – Bush admin reported in their 2002 budget request that the “size of GSE’s is a potential problem, trouble in either one could cause strong repercussions in financial markets”
April 2003 – Bush Admin upgraded risk to “Systemic Risk that will extend beyond housing”
Fall 2003 – Snow testifies before Congress and stated that action must be taken to create an agency to regulate and supervise GSE’s.
As the ranking member of Financial Services Barney stated that there is no crisis and he believed Fannie and Freddie need to do more. The bill was blocked.
Feb 2005 – Greenspan testifies before Congress and states enabling GSE’s to grow in size will “be placing the total financial system of the future at risk”. The senate at this point recognized their was a problem but the parties couldn’t reach a consensus on a bill so no action was taken)
April 2005 – Greenspan testifies before congress and states that “if we fail to strengthen GSE regulation we increase the possibility of insolvency and crisis”.
Shumer and Frank were satisfied with the condition of the GSE’s. No regulations were passed and business continued on at a disastrous pace.
In September 2007 Barney requested that GSE;s purchase sub prime mortgages and raise the lending limits.
In July 2008 Barney stated that going forward everything looked very promising.
The financial markets locked up the following month.
The current GSE’s guarantees are approximately 11 trillion