Arnold Kling has some quotable insights on the housing tragedy I found worth sharing:
“Old consensus: We need Freddie and Fannie in order to make housing “affordable.”
New consensus: We need them in order to “prevent further house price declines,” in other words, to make housing less affordable.”
[via Free Market Mojo]
"Add President Clinton to the long list of people who deserve a share of the blame for the housing bubble and bust. A recently re-exposed document shows that his administration went to ridiculous lengths to increase the national homeownership rate. It promoted paper-thin downpayments and pushed for ways to get lenders to give mortgage loans to first-time buyers with shaky financing and incomes." //BusinessWeek//Image via Wikipedia
Furthermore – Why did Fannie Mae and Freddie Mac fail? NY Times covered the political backdrop here:
“In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.
Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.”
Thank you Bill Clinton. Credits to Chip Hanlon – more here.
Recent Comments