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Politics : GOPwinger Lies/Distortions/Omissions/Perversions of Truth
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To: Brumar89 who wrote (139579)9/30/2008 10:22:35 PM
From: Kevin Rose1 Recommendation  Read Replies (3) of 173976
 
You are saying that regulations which protect minorities from discrimination caused the subprime mortgage mess that led to the problem we have now? That's simply wrong. The subprime mortgage mess was caused by a lack of regulations and oversight to prevent predatory lending practices.

When Wall Street figured out how to take advantage of Bush's economic fallacies - artificially low interest rates, lack of oversight, deregulation of banking - they created a super heated market for new mortgages, which were quickly packaged and passed on. Once the 'normal' mortgage market was tapped, this super heated market led to predatory lenders who targeted people that wanted the American dream but could not normally qualify. A lack of oversight and regulations to protect these people caused many to be conned into loans that they could not afford, with teaser rates, hidden fees, and inflated realty. The lenders did not care if these people would be forced out of their homes within a year or two - they had already unloaded the mortgages, which then probably got traded around a dozen times.

As usual, when Wall Street is left to its own devices, it creates a feeding frenzy where the rich grab as much as they can, as quickly as they can. With little regulation or oversight, the plunderers were on their own - and they took every advantage.

To conflate efforts by Democrats to prevent discrimination in lending in the 90's to the inverse - where predatory lenders targeted minorities with bogus loans and promises of the American dream - is yet another silly Republican myth that is being passed around to deflect blame from the true cause of the problem - deregulation and underenforcement of existing regulation.
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