Franklin Raines played the Washington game of knowing all the right people.A superb essay from Talkimag.com
The Diversity Recession, or How Affirmative Action Helped Cause the Housing Crisis
In 1992, Congress passed the Government Sponsored Enterprises bill, which set “targets” (i.e., quotas) for Fannie Mae and Freddie Mac, which are quasi-governmental publicly-traded for-profit thing-a-ma-bobs, to encourage “affordable” and “underserved” (more or less minority) home loans.
Both the Clinton and Bush departments of Housing and Urban Development raised the quotas repeatedly. For example, initially, the Clinton Administration required 21% of these quasi-governmental mortgages must go to ”underserved areas” (which are officially defined as “low-income census tracts or in low- or middle-income census tracts with high minority populations"), but the quota for 2008 established by the Bush Administration is 39 percent.
Reuters reported October 13, 1999:
The mortgage industry intends to pursue minorities with greater intensity as federal regulators turn up the heat to increase home ownership in underserved groups. ‘We need to push into these underserved markets as much as we can,’ said David Glenn, president and chief operating officer of Freddie Mac. …
In September, Freddie Mac launched a new lending program, based on research done in collaboration with five black colleges, to bring more African-Americans into the market.
The federal government in the meantime has increased pressure on lenders to seek out minorities, as well as low-income groups and borrowers with poor credit histories.
Fannie Mae recently reached an agreement with the U.S. Department of Housing and Urban Development to commit half its business to low-and moderate-income borrowers. That means half the mortgages bought by Fannie Mae would be from those income brackets.
Read the entire article at Talkimag.com
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Others saw it coming- From 2004:
Stop Franklin Raines’ Rape of Fannie Mae — and Taxpayers
Contact: Peter Flaherty 703-237-1970
Date: December 29, 2004
Website: www.nlpc.org
Peter Flaherty, President of the National Legal and Policy Center, today expressed surprise and disgust at the current attempt by fired Fannie Mae Chairman and CEO Franklin Raines to walk away with millions despite his central role in the accounting scandal rocking the company.
NLPC promotes ethics in public life, and sponsors the Corporate Integrity Project.
Flaherty said, “Let me get this straight. Raines apparently cooks the books, brings disgrace to the company, and imperils Fannie Mae’s standing with regulators, the Congress and administration. So for his punishment he is made wealthy for the rest of his life?”
According to a December 27 Form 8-K filing with the Securities and Exchange Commission, Raines is entitled to:
•“Deferred compensation” of $8.7 million
•Stock options currently worth $5.5 million, and potentially millions more
•”Performance Share Payouts” through 2006, potentially worth millions more
•A monthly pension of $114,393 for the rest of his life, and the for life of his spouse should she survive him
•Free medical and dental coverage for the rest of his life, as well as for his wife for the rest of her life, and his children until age 21
•Free life insurance in the amount of $5 million until age 60, and $2.5 million thereafter
The agreement even allows for Raines to receive a “cash bonus” for 2004.
Raines stated that, “By my early retirement, I have made myself accountable.” Flaherty reacted by saying, “It is like Enron and Tyco never happened. I cannot even fathom the level of arrogance and self-delusion necessary for Raines to claim he’s been made accountable for his mistakes.”
Flaherty continued, “The OFHEO regulators have taken the right step in reviewing Raines compensation. But if Fannie Mae executives inflated profits to increase their own bonuses, that is fraud. Political connections should not insulate corrupt executives from criminal prosecution, if it is warranted.”
“This is not a case of foolish or captive directors rewarding a failed executive with a golden parachute. Fannie Mae is not really a private company. It has been granted advantages in the marketplace by Congress, that are worth billions of dollars. Raines is not only fleecing Fannie Mae, but also the taxpayer.”
“Raines was paid $20 million in 2003 but was never really a private-secter corporate executive. His CEO position was more of a political plum. Most of his career was spent in political appointments or at Fannie Mae itself.”
Check out Franklin Delano Raines political contributions over the years. This is what we get from our rulers and masters.
ReplyDeleteDr. Bill is really ripping the Sierra Club, the 9th District Court of Shemeels and most of the Forest Service over those California fires, as the policy has been no thinning, so the fuel builds up and the fires explode. Also they don't even log the burnt trees afterwards, letting them rot, billions of board feet, good wood, let them rot, decomposing, adding more CO2 to the air than all of LA. Hang them all, he says. Says people ought to be filing suit against the Sierra Clubs and keep at it. Also they have been banning the creation of fire break roads, and not letting people clear fuel away from their properties.
ReplyDeleteThe old forests didn't burn like this as they didn't have the small trees and undergrowth. The old big trees usually had some burn marks on the lower trunks from small fires that had burned lower but unable to reach the first branches. Now the whole damn forest goes poof.
Says he's been warning this for 20 years. People are starting to listen.
Up here in Idaho, we thin. Most places.
The cities should be filing suit, he says. Barbars Boxer is the worst he says. Tahoe goes next.
These new fires destroy the whole thing. The top soil goes. Washes into the streams. No spawning grounds.
ReplyDeleteDr. Bill, nuclear weapons designer, old forest hand, has a string of cat dozers on these fires tonight.
Years ago there was a big case in California about the banks 'redlining' certain districts, and they wouldn't make any loans in that area, that was their policy. This was found to be discrimitory, and the courts ordered the banks to knock it off. How this relates the freddies I don't know.
ReplyDeleteRedlining
ReplyDeleteNew Redlining
When crime gets bad no one, quite logically, wants to insure.
Now Dr. Bill is on Anwar, and what suckers we have been taken for, by the environazis.
Anwar
Dr. Bill
Guy from Carmel, California calls in says two 100,000 acre fires are converging, nothing to stop it. No fire breaks.
ReplyDelete---
We are supposed to start calling nuclear energy New Clear Energy, in all our writings.
Bob, the entire thing goes back to high handed government meddling. Local banks were the law of the land before national re-regulation. People saved local and borrowed local. Whether in a small town or large city.
ReplyDeleteBig city banks knew their neighborhoods. People saved money in the Polish neighborhoods and in the black areas, extra cash had to be shipped in at the beginning of the month to cover cash checking of welfare checks. That was an obvious reality.
Another reality was loan losses. Bankers hate to lose their own money and would not take the risk in certain areas. The reason was simple. It was not a risk, it was a sure thing that if you loaned money in the ghetto, you were not going to get it back.
The liberals hated that. It was not fair. Something had to be done to celebrate and embrace diversity so they came up with programs to first terrorize lenders and then help create a scam so that they could slice and dice a federal lending system where they {the bankers) would no longer have to lend their own money. Everyone was happy.
Now instead of local bank having to send out extra cash to certain neighborhoods to cover welfare checks, the entire federal banking system has to wire dollar signs followed by zeros to cover entire banks. The only problem is the federal government has no money but you do. Your children and grandchildren will have to chip in as well , but that is a small price to pay for diversity and doing the right thing.
Now I am sure the Obama regime will change all that. If a stingy compassionate Republican could have been so generous with tax payer wealth, surely a progressive visionary will do better.
ReplyDeleteYes. Yes. Yes, we can! Hope is on the way.
Now millions of stupid American voters are going to turn over the entire federal system to a street hustler that made his bones organizing the non-productive to get what they deserve from the system.
ReplyDeleteObama is an interesting man. He and his white mother were abandoned by his African father. After his hippy mom expired , he was raised by white people and went to white schools. He went to the best colleges and Universities provided by rich white people.
After graduation he went black, worked in the ghetto and spent twenty years in an afro-centric church listening to a black racist and celebrating diversity with a very left wing black congregation. Now so that he can become president, he needs lots of white people to be convinced that he is different. He is change. He is a post racial type of guy. He sees what white folk need to see to believe, and it ain't all that much. If he pulls it of, it will be merci beaucoup mother fuckers.
I can't seem to find the case I was thinking of. Maybe it was just legislation. Anyway under the equal protection clause it's hard to see how the result could be anything else, if the government is involved.
ReplyDeleteI still don't see if the bad loans are about 1% how it's such a big problem. If it is just 1%.
Around here, real estate prices really went up in the wake of 9/11, when the interest rates were dramatically brought down. Those inflated prices have leveled off around here, for the most part anyway.
I am new enough on the national political scene that I serve as a blank screen on which people of vastly different political stripes project their own views. As such, I am bound to disappoint some, if not all, of them. BHO-Audacity of Hope
ReplyDeleteThat at least sounds like an honest enough appraisal. Barack 'Blank Screen' Obama
Wretch has that in his new post.
ReplyDeleteI've been talking about the subject of the post, but the detail I had never seen is Bush THIRTY NINE PERCENT!
ReplyDeleteAlmost double Bubba.
What a total loser Wuss has turned out to be.
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The People still around him are just as Bad, with Condumb Rice being a great example:
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Why Is the State Department Giving North Korea Dual-Use Material? [Tim Wilson]
"Truly evil regimes will never be reformed and ... such regimes must be confronted, not coddled." Condoleezza Rice, National Security Adviser, April 2002 during remarks on terrorism and foreign policy
“The fuel oil, it's a heavy fuel oil. It can only be used in certain power plants that they have.” Christopher Hill, chief US negotiator with North Korea, February 2007 commenting on the agreement to ship 1,000,000 tons (6,000,000 barrels) of Heavy Fuel Oil (HFO) to North Korea.
BS, Bunker Fuel for ships, Tank Fuel.
Grain shipments for the military, etc etc.
Thanks to the efforts of our own State Department, we are supporting the North Korean military in exchange for promises, paperwork and overpriced demolitions (more than $2.5M for the YongByon cooling tower, probably about $2M more than any reputable firm would have charged, perhaps some $2.4M more than if the Army Corps of Engineers had been given the task and $2.48M more than it likely cost North Korea). This diplomacy is being pursued in the face of our own laws and contrary to UN Security Council Resolutions. No wonder the War on Terror is a mess and Iran’s rulers continues to pursue their nuclear ambitions.
Our “diplomacy” provides no incentives for them to do otherwise!
Here ya go al-Bob:
ReplyDeleteHere ya go, Al-Bob:
The EPA’s Blueprint for Disaster
A new regulatory regime from our environmental bureaucrats would grind the economy to a halt.
Wow Deuce, you were hitting on all cylinders this morning. Great comments. The Raines story is intolerable. That man deserves jail time and nothing else. Not one dime more than what he has already "stolen."
ReplyDeleteAs a practical matter the problem with Dr. Bill's desire to sue the Sierra Club etal is that they'd be sued in front of the same judges that ruled for them in the first place, at least on appeal.
ReplyDeleteAlaska volcano erupts, flings ash 30,000 feet high -
ReplyDeleteNo arrests, no convictions.
ReplyDeleteNo problem
A Republican Justice Department
So it's a bipartisan thing, ain't it?
Maverick he, well no his wife, profited from the las lending meltdown.
Obama, all he got was a driveway and room for a garden, before this one
Senate passes mortgage rescue plan
ReplyDeletePart of W's legacy is no convictions.
ReplyDeleteTwo Meanings.
I emailed bobal's Atlas Shrugs/ANWR link to most of my contact list.
ReplyDeletePass it on to yours.
The Last Laugh:
ReplyDeletehttp://www.youtube.com/watch?v=t0jgZKV4N_A
http://www.youtube.com/watch?v=59H1DS6MvoQ
Here's a Cato podcast, July 12, 2008: "Shrink, Privatize Fannie Mae and Freddie Mac" featuring Gerald P. O'Driscoll Jr.
ReplyDeleteI loved that picture of the caribou lying around by the oil rigs and pipe, and the bear walking along on a pipe like a high wire walker!
ReplyDeleteDid Ash really get tossed 30,000 feet up?
Obama comments:
ReplyDeleteThe Democratic White House hopeful Barack Obama has made his first comments about the problems facing the GSEs. (Government sponsored enterprises, fannie and freddy)
He described the situation as being of "extraordinary concern", but did not support an immediate bail-out.
"I think we need to watch carefully and see how it plays out before we make a decision about which steps need to be taken, if any," he told reporters on a flight to San Diego.
"I have confidence that with some prudent steps by the government, that we'll be able to stabilise the situation."
translation: He has no clue.
Those two English guys are good, Mat.
ReplyDelete'Sharon 1' and 'Sharon 2' Mortors Lobbed Into Palestine, 'Sharon 3' Missile Attack Fails
I was wondering when some guy would get fed up, and start making missiles in his garage.
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"I think we need to watch carefully"
That's what I always used to say when the rains didn't come.
He has no clue.
ReplyDeleteSo what's new?
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Someone also wrote,
he missed the vote.
There is real red meat in the interview he gave on CNN discussing international events. I am too lazy this afternoon, to write anything about it. Wait til Hewitt gets into it.
ReplyDeleteFor The Second Straight Day Rasmussen Daily Tracking Poll Shows McCain/Obama Race Tied
ReplyDeleteWill take a few more days to see if trend is real, report says.
Tee Hee!
ReplyDeleteI lucked into a coincidental immediate comeback to Bill Bradley at Wretch's!
2 million angry Democrats reject Obama
Money raised by PUMAs also doesn't go to Obama's campaign or the DNC coffers.
Bower also pointed to polls indicating shrinking support for Obama.
"CNN did a poll at the beginning of June that showed 1 of every 5 Clinton supporters would not vote for Obama.
Well, just one month later that's now 1 in 3.
So we're getting our numbers up and we're growing strong. And if the DNC's not worried about us, then they're clueless as to this movement."
They also credit Obama with helping their effort.
"In the last two weeks we've seen Obama go back on his campaign promises – FISA, campaign finance, especially the Iraq war," Bower said.
"There is a movement afoot," Bower confided. "It hasn't hit the ground yet, but we want to target down-ticket Democrats who have been complicit in the DNC's dealings these past few months. You'll probably be hearing more about that soon. Some of Obama's original supporters are leaving him. Eight super-delegates left Obama this week. People are realizing Obama will be a dead weight to them and that's why these eight delegates have switched back over to Hillary's column. And I'm expecting there'll be more to follow."
"He's only the presumptive nominee."
No surprise. The Fed and Treasury are going to throw whatever they have to keep fannie and freddie afloat.
ReplyDelete"He's only the presumptive nominee."
ReplyDeleteDoug, if that lightning should actually hit, it'll be true chaos in the democratic ranks.
Maybe both parties could take a Mulligan.
ReplyDeleteHere in Idaho the republican candidate who will be replacing Craig has refused to schedule debates with his democratic rival. This is a luxury to us voters. A state where you can just ignore 'em.
ReplyDeleteThis is what Butch Otter did when our heroine Linda Pall ran against him some years ago. Just ignore her.
A luxury I tell you.
NEWS FLASH!!!!
ReplyDeleteMichelle "Whitey" Video Found!!
"Whitey"
The Two-Headed Calf
ReplyDeletefrom "Original Sin" by Alan Jacobs
The West is Rebecca West who wrote "Black Lamb and Grey Falcon" which Jacobs thinks is the best book written in the 20th Century.
Jacobs is a Christian, rejecting the Augustinian absolutism of the idea of orignal sin(unbaptized badies going to hell, etc) but sees deep meaning in the idea.
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As for West the heart of the matter is that insight into our universal corruption, an insight confirmed for her a couple of days later, in the small town of Struga, where Bishop Nikolai performs his magic for another congregation, while West and her husband visit a curious little "biological museum" that contains, among other things, a stuffed two-headed calf in a glass case, an animal "strangely lovely in form", so that "it was a shock to find that of the two heads which branched like a candelabra one was lovely, but one was hideous, like that other seen in a distorting glass." The museum's custodian confirmed that the calf had lived for two days "and should be alive today had it not been for its nature". West's husband expressed puzzlement at this statement, and the custodian explains that when they fed milk to the calf through its beautiful head, its ugly head spat the milk out, so no food got into its stomach, and it died. This account prompts West to meditation:
To have two heads, one that looks to the right and another that looks to the left, one that is carved by grace and another that is not, the one that wishes to live and the other that does not; this was an experience not wholly unknown to human beings. As we pressed our faces further against the case, peering through the green dusk, our reflections were superimposed on the calf, and it would not have been surprising if it had moved nearer the glass to see us better.
The whole history of Yugoslavia, West comes to think, is the story of a two-headed calf, and maybe the whole of human history. In 1914--in a conflict that began, of course, in Yugoslavia, with the assassination of Archduke Ferdinand in Sarajevo--the ugly head spat out the life giving milk, after a century in which it had appeared that the beautiful head would be able to take in nourishment; and now, twenty years later, it was clear that once more the ugly head was about to have its hateful way. The Orthodox Church, understood this fact of our nature; Bishop Nikolai knew how to enact it in magical rites of extraordinary power to explain and comfort.
The confirmation of Bishop Nikolai's magic in the vision of the two-headed calf might have been enough to make someone a convert to Christianity. After all, it was something very like this insight that brought a Soviet prisoner named Aleksandr Solzhenitsyn to the Orthodox faith. In The Gulag Archipelago Solzhenitsyn describes the terrible (and yet for him life giving) experience of watching one of the prison guards who habitually mistreated the prisoners and slowly coming to the realization that, given the same power in the same circumstances, he himself would surely have behaved with equal cruelty. "In the intoxication of youthful success" he had believed himself "infallible"; it was the Gulag that taught him that he was "a murderer and oppressor." It was the Gulag that taught him that everyone has the capacity to become a Stalin and that therefore "the line separating good from evil passes not through states, nor between classes, nor through political parties either--but right through every human heart." In other words every one of us is a divided self, a two-headed calf. His "bent back...nearly broke beneath the load" of this knowledge, but in the end it led him into the arms of the Orthodox Church, which alone knew the meaning of this divededness and its remedy.
Given what she says about her experience in the church at Ohrid, West might have become such a convert. Yet she did not, and the reasons are worth exploring. The key may be found in the midst of her ecstatic account of Bishop Nikolai's Mass, in these specific words: "In his defeat Jesus was victorious, since it is far better to be crucified than to crucify." Yes, but, West comes to ask, are those the only choices? Is it not true that to crucify and to accept crucifixtion are alike manifestations of the love of death? Are not both acts of the calf's ugly head, merely two different ways of rejecting the life-giving milk?
And so West comes, at last, after all her experiences and meditations in the land of the South Slavs, to one of the worst positions a person can occupy in thinking of her fellow human beings: an Augustinian anthropology without its accompanying theology.
Treasury Acts to Save Mortgage Giants
ReplyDeleteBillions in Support for Fannie Mae and Freddie Mac
Announcement of the plan to inject billions of dollars through investments and loans was intended to show that the government would stand behind the beleaguered companies.
Text of Paulson Statement (ustreas.gov)
Analysts Say More Banks Will Fail
ReplyDeleteThere is less danger than in the savings-and-loan crisis of the 1980s, but as many as 150 U.S. banks could fail over the next year, analysts say.
Times Topics: Fannie Mae Freddie Mac
S.E.C. Warns Wall Street: Stop Spreading the False Rumors