Posted by
Board Certified M.D. on Monday, September 22, 2008 10:52:56 AM
The Fannie Mae debacle basically is a Balloon Payment that has popped/exploded for high risks borrowers who were given negative amortization type loans whose home appreciation could not keep with the increasing loan amounts they owed. Responsible are some Republicans but mostly Franklin Raines, Jamie Gorelick and James Johnson all Democrat appointees cooked the books and walked away from the Quasi-Goverment run Fannie Mae & Freddi Mac with ~$135 MILION dollars in bonuses over their base pay. This was possible because former President Bill Clinton twisted the arms of lending institutions to either give High Risk Borrowers loans to buy homes or lose their charter to be Mortgage Lenders. When the Fannie Mae backed Balloon got so large and Republicans souned the alarm bells Democrats like Barney Frank, Chris Dodd and Barack Obama ran cover for Fannie Mae. All this is EXPLAINED by Limbaugh, the American Thinker and Invester's Business Daily.
- "The untold story in this whole national crisis is that President Clinton put on steroids the Community Redevelopment Act, a well-intended Carter-era law designed to encourage minority homeownership. And in so doing,
- he helped create the market for the risky subprime loans that he and Democrats now decry as not only greedy but 'predatory.'" See, the very people that designed the program that led to all of this mess now get to blame the private sector and they're put back in total control and charge of it. "Yes, the market was fueled by greed and overleveraging in the secondary market for subprimes, vis-a-vis mortgaged-backed securities traded on Wall Street.
- But the seed was planted in the '90s by Clinton and his social engineers. They were the political catalyst behind this slow-motion financial train wreck. And it was the Clinton administration that mismanaged the quasi- governmental agencies that over the decades have come to manage the real estate market in America. A
- s soon as Clinton crony Franklin Delano Raines took the helm in 1999 at Fannie Mae, for example, he used it as his personal piggy bank, looting it for a total of almost $100 million in compensation by the time he left in early 2005 under an ethical cloud."
- Can I translate that for you? Franklin Raines was a Treasury employee, some sort of cabinet secretary in the Clinton administration. He ends up at Fannie Mae and pays himself a hundred million bucks from 1999 to 2005, and they finally had to get rid of him because the scandal could not be contained. Democrats propped up this, Carly! Bush didn't do any of this.
- "Other Clinton cronies, including Janet Reno aide Jamie Gorelick, padded their pockets to the tune of another $75 million." Gorelick again.
- "In the end, Fannie had to pay a record $400 million civil fine for SEC and other violations, while also agreeing as part of a settlement to make changes in its accounting procedures and ways of managing risk. But it was too little, too late. Raines had reportedly steered Fannie Mae business to subprime giant Countrywide Financial, which was saved from bankruptcy by Bank of America." Hello, Mr. Chris Dodd, number one receiver of campaign contributions from Fannie Mae.
- "At the same time, the Clinton administration was pushing Fannie and her brother Freddie Mac to buy more mortgages from low-income households.
- The Clinton-era corruption, combined with unprecedented catering to affordable-housing lobbyists.
• Investor's Business Daily: The Real Culprits In This Meltdown
- HotAir: Whose Policies Led To The Credit Crisis?
• American Thinker: Jamie Gorelick's Two Trillion Dollar Disasters