Bush Ignored Warnings that Economy Was in Serious Trouble
No one can ever accuse Chimpy of being Inconsistent-
He Made Up His Mind-
The Bush administration backed off proposed crackdowns on no-money-down, interest-only mortgages years before the economy collapsed, buckling to pressure from some of the same banks that have now failed.
He Was Warned-
“Expect fallout, expect foreclosures, expect horror stories,” California mortgage lender Paris Welch wrote to U.S. regulators in January 2006, about one year before the housing implosion cost her a job.
He Listened to Fools-
“These mortgages have been considered more safe and sound for portfolio lenders than many fixed rate mortgages,” David Schneider, Home Loan President of Washington Mutual, to Federal Regulators in 2006. (When Wa-Mu collapsed, some two years later, it was the Largest Banking Failure in U.S. History).
Suggested Rule Changes Were Ignored-
In 2005, faced with ominous signs the housing market was in jeopardy, bank regulators proposed new guidelines for banks writing risky loans. Today, in the midst of the worst housing recession in a generation, the proposal reads like a list of what-ifs:
_Regulators told bankers exotic mortgages were often inappropriate for buyers with bad credit.
_Banks would have been required to increase efforts to verify that buyers actually had jobs and could afford houses.
_Regulators proposed a cap on risky mortgages so a string of defaults wouldn’t be crippling.
_Banks that bundled and sold mortgages were told to be sure investors knew exactly what they were buying.
_Regulators urged banks to help buyers make responsible decisions and clearly advise them that interest rates might skyrocket and huge payments might be due sooner than expected.
He put his faith in the Free Marketeers-
“An open market will mean that different institutions will develop different methodologies for achieving this goal,” Joseph Polizzotto. (Old Joe Represented the now Defunct Lehman-Brothers).
“Appears excessive and will inhibit future innovation in the marketplace,” Mary Jane Seebach, Managing Director of Public Affairs at Countrywide Financial Corporation, in response to the Proposal from Federal Regulators.
“To conclude that ‘nontraditional’ equates to higher risk does not appropriately balance risk and compensating factors of these products,” Lillian Gavin, Chief Credit Officer at Downey Savings, which joined the Growing List of Failed Banks Last Week.
I could on, but…
-Chimpy received Warning that a Potential Catastrophe Was on the Horizon, but, Per usual, he said, “Nah, everything’s going according to plan.”
-Lenders knew a Potential Catastrophe Was on the Horizon, but told Washington, “Don’t worry we Got This. Trust the Free Market, Baby.”
-Regulators attempted to Tigthen the Reins, but were Rebuffed by the Great Chimpleton.
-American Tax Payers were Forced to Eat 7 Trillion Pounds of Shit.
Ladies, and Gentlemen-
A Round of Applause for One of the Most INEPT Men to Ever Walk The Earth
Having an Old Milk Jug Filled with Ron Paul’s Duck Butter does not make you an Economist.