Romney Newtered in South Carolina

[NickyJ]

I think the fundamentals of Newt's campaign are actually stronger than Mitt's right now, especially with Republicans. The problem is, like Antilogic pointed out, he could say something ******** and blow the whole thing up any second.

Paul Ryan's budget was called "right wing social engineering" by the Newtster. That wasn't a stupid thing to say? (Democrats may agree with him, but we're look at the Republican nomination, so please keep that in mind.)

I think if Santorum bows out, he ultimately goes behind Romney, because I think Santorum is, ultimately, more tied to the current rank and file of the GOP than Newt, and the GOP knows full well that Gingrich has no chance of beating Obama, while Romney does at least have a shot at it.

I can only hope so. But the problem is, will his followers to Romney as well, or will they go with Gingrich?

 

[Cutlass]

You know fully well the CRA was a contributing factor... that's what the "rich white folk" were exploiting... and the dems who pushed it, while meaning well, enabled that.

So for 30 years, the typical length of a mortgage, by the way, no problems resulted from CRA. And then suddenly, once those early CRA mortgages were paid off in their entirety, CRA becomes a problem that devastates the world's economy.

Yeah, that narrative makes sense.

 

[RobAnybody]

You know fully well the CRA was a contributing factor...

People still believe that? Weird. It's like coming across a Flat Earther. You just don't expect to see them anymore, so it's a bit of a shock when you do.

 

[Antilogic]

Paul Ryan's budget was called "right wing social engineering" by the Newtster. That wasn't a stupid thing to say? (Democrats may agree with him, but we're look at the Republican nomination, so please keep that in mind.)

If that hasn't been in an attack ad yet, it probably will. Mr. Ryan hasn't been in the news lately, so people may forget that unless it is brought back up.

 

[kochman]

So for 30 years, the typical length of a mortgage, by the way, no problems resulted from CRA. And then suddenly, once those early CRA mortgages were paid off in their entirety, CRA becomes a problem that devastates the world's economy.

Yeah, that narrative makes sense.

It was a contributing factor, absolutely. The perfect storm. Without the subprime situation and repeal of the Glass-Steagal Act, bipartisan as it was, the problem wouldn't have been nearly as bad (and may not have happened)... but CRA was certainly a contributing factor to the utter failure that ensued.
How many of those mortgage bundles included CRA loans? Most if not all... because they offered higher interest rates...
The exploitation of these "high interest rates" was done with, in many cases, full knowledge (within investment banking) that they were high risk... get rich quick.

Too much flipping was also an issue... people buying 8-10 houses, then selling them after a few years at massive profit was so alluring that no one considered what happened if the bottom dropped out... or, better put, the bubble burst. Oops, now I have 10 mortgages scheduled to hit ballooned interest rates in a year... time to declare bankruptcy!

People still believe that? Weird. It's like coming across a Flat Earther. You just don't expect to see them anymore, so it's a bit of a shock when you do.

Wow. You just equated what I said, and most people know, to thinking the world is flat.
I'm sorry I am such an ignoramus.

So, the at least 50% of subprime loans that came from the CRA had nothing to do with it?
How many of those CRA loans with balloon mortgages are still being paid off without problem? What percent of that 50%? Maybe 1%...
But, no, that could have nothing to do with it.

 

[Cutlass]

It was a contributing factor, absolutely. The perfect storm. Without the subprime situation and repeal of the Glass-Steagal Act, bipartisan as it was, the problem wouldn't have been nearly as bad (and may not have happened)... but CRA was certainly a contributing factor to the utter failure that ensued.
How many of those mortgage bundles included CRA loans? Most if not all... because they offered higher interest rates...
The exploitation of these "high interest rates" was done with, in many cases, full knowledge (within investment banking) that they were high risk... get rich quick.

Too much flipping was also an issue... people buying 8-10 houses, then selling them after a few years at massive profit was so alluring that no one considered what happened if the bottom dropped out... or, better put, the bubble burst. Oops, now I have 10 mortgages scheduled to hit ballooned interest rates in a year... time to declare bankruptcy!

CRA loans are less likely to default than other loans. And they are for smaller money. It really wasn't an issue compared to literally everything else.

Wow. You just equated what I said, and most people know, to thinking the world is flat.
I'm sorry I am such an ignoramus.

So, the at least 50% of subprime loans that came from the CRA had nothing to do with it?
How many of those CRA loans with balloon mortgages are still being paid off without problem? What percent of that 50%? Maybe 1%...
But, no, that could have nothing to do with it.

Balloon loans and adjustable rate loans have nothing to do with CRA, and never should have been permitted. But it is the banks that forced them through, not the CRA law.

 

[RobAnybody]

So, the at least 50% of subprime loans that came from the CRA had nothing to do with it?

Exactly. Now you're getting it. Look up Credit Default Swaps & expand your horizons!

 

[mangxema]

Given that Florida's delegate total has been dropped by roughly 50%, a win in Florida doesn't give the same boost that it did in prior years too.

I'm not so sure. The delegates are all at-large this year because of the penalty. Some of the minor players may divert their attention away from the state, so there may be the possibility of a comeback that can be spun as momentum.

Interesting. Naively, I think most people assume that he would back Gingrich. But these are good points as to why he wouldn't.

He wouldn't be the only one:

Over a political career of nearly 40 years, Gingrich has convinced almost everybody who has ever worked closely with him that he cannot and should not be trusted with executive power.
The reaction to Gingrich's poll surge in December was panic among senior Republicans, and the panic is only intensifying now. It's striking that almost none of Gingrich's former colleagues in the House has endorsed him for president. Striking that nobody associated with a past Republican presidential association has done so.
He is a candidate of talk-show hosts and local activists -- and of course of Rick Perry and Sarah Palin -- but not of those who know him best and have worked with him most closely. Gingrich may raise more money after his South Carolina win. But prediction: Romney will raise even more, among the great national network of Republicans who recognize that to nominate Gingrich is to commit party suicide.

 

[kochman]

CRA loans are less likely to default than other loans.

Source?

And they are for smaller money. It really wasn't an issue compared to literally everything else.

Balloon loans and adjustable rate loans have nothing to do with CRA, and never should have been permitted. But it is the banks that forced them through, not the CRA law.

So, 50% failure... nothing to do with it.
The toxic loans were giving, 50%, to CRA... that's a fact.
What percentage of that 50% is still being serviced regularly? I am sure you can agree they have overwhelmingly defaulted.

Those smaller loans were thrown into mortgage bundles... which were invested in...

Exactly. Now you're getting it. Look up Credit Default Swaps & expand your horizons!

I work in real estate, so I think I have an idea of what is going on here. Thanks for being dismissive though, appreciate it!

 

[Cutlass]

Source?



So, 50% failure... nothing to do with it.
The toxic loans were giving, 50%, to CRA... that's a fact.
What percentage of that 50% is still being serviced regularly? I am sure you can agree they have overwhelmingly defaulted.

Those smaller loans were thrown into mortgage bundles... which were invested in...

No part of the CRA loan in any way forced any bank to make any loan that the bank did not think was safe. If a loan wasn't safe, the reason was not the law, but the bank.

 

[Antilogic]

I'm not so sure. The delegates are all at-large this year because of the penalty. Some of the minor players may divert their attention away from the state, so there may be the possibility of a comeback that can be spun as momentum.

So there was a plan to split the delegates proportionally that has been dropped as the result of this penalty? Has Florida historically split its delegates between multiple candidates? In that case, I could see it as being a little more influential than I first thought (besides, obviously, the momentum and money angles, where any early primary is going to have a significant impact over a later one).

He wouldn't be the only one:

Wow, I didn't realize Gingrich had received so few endorsements. I thought he was receiving more from at least the Southern politicians.

 

[Joecoolyo]

I think if Santorum bows out, he ultimately goes behind Romney, because I think Santorum is, ultimately, more tied to the current rank and file of the GOP than Newt, and the GOP knows full well that Gingrich has no chance of beating Obama, while Romney does at least have a shot at it.

He might do so, but I doubt his followers will.

He's pandering to the same base as Gingrich, and if he's gone, they're going to flock to the next closest thing.

 

[mangxema]

So there was a plan to split the delegates proportionally that has been dropped as the result of this penalty? Has Florida historically split its delegates between multiple candidates? In that case, I could see it as being a little more influential than I first thought (besides, obviously, the momentum and money angles, where any early primary is going to have a significant impact over a later one).

With a little bit of googling, it looks like FL would have had 99 of which roughly 2/3 would be based on congressional districts. What happened before though I'm not sure. From the few maps that I've seen, it looks if FL has been fairly uniform in primaries, but then again, then would make sense if they were later in the year, when the contest is mostly decided. So I don't know; I'm new here.

 

[kochman]

No part of the CRA loan in any way forced any bank to make any loan that the bank did not think was safe. If a loan wasn't safe, the reason was not the law, but the bank.

No one said the CRA forced the banks to do that... It gave them an opportunity to, and they were encouraged to have good CRA ratings by the government.
http://www.federalreserve.gov/newsevents/testimony/braunstein20070521a.htm

I agree that bankers knew when they were offering homes to people they knew couldn't afford it, it was done out of greed. However, the people accepting the loans were also doing it out of greed.

I could have gotten a loan for 10.34 times my annual salary, during that debacle, when in reality I would have a very hard time servicing a load that was a mere 4 times my salary.
The banks knew it was wrong. I knew it was wrong.

They knew it was predatory when they started offering this to people who make substantially less than I did... I don't think you would deny this. The people who signed up for these mortgages are to blame as well... they knew they wouldn't be able to pay the huge payments after the 5 year arm expired.

At the same time, the banks were able to tout there CRA rating as a bank... which led to favorable treatment from the gubbamint.
http://www.federalreserve.gov/newsevents/testimony/braunstein20070521a.htm

Anyhow, 50% of the subprime loans were CRA... they failed. That's really the only stat that matters... you can't have 50% of many investment areas go wrong and still be ok.

 

[Cutlass]

No one said the CRA forced the banks to do that... It gave them an opportunity to, and they were encouraged to have good CRA ratings by the government.
http://www.federalreserve.gov/newsevents/testimony/braunstein20070521a.htm

I agree that bankers knew when they were offering homes to people they knew couldn't afford it, it was done out of greed. However, the people accepting the loans were also doing it out of greed.

I could have gotten a loan for 10.34 times my annual salary, during that debacle, when in reality I would have a very hard time servicing a load that was a mere 4 times my salary.
The banks knew it was wrong. I knew it was wrong.

They knew it was predatory when they started offering this to people who make substantially less than I did... I don't think you would deny this. The people who signed up for these mortgages are to blame as well... they knew they wouldn't be able to pay the huge payments after the 5 year arm expired.

At the same time, the banks were able to tout there CRA rating as a bank... which led to favorable treatment from the gubbamint.
http://www.federalreserve.gov/newsevents/testimony/braunstein20070521a.htm

Anyhow, 50% of the subprime loans were CRA... they failed. That's really the only stat that matters... you can't have 50% of many investment areas go wrong and still be ok.

You are missing the point: CRA makes banks cease to ignore the poor and colored. But it does not force them to make any loan that the bank thinks is unsafe. If the bank makes an unsafe loan, that has nothing to do with anything in the CRA law, and is all on the bank's responsibility. And many of those loans had nothing to do with CRA, because they were made by mortgage brokers which were not regulated as banks. In many cases essentially not regulated at all.

And where did the money for those loans come from? It came from Wall St. So not only did the free market mortgage brokers fail in due diligence, but Wall St investment banks failed in due diligence, and the credit rating agencies also failed. That is all market failures that have nothing to do with CRA.

 

[kochman]

How does it both "make banks cease to ignore the poor and colored" while at the same time "it does not force them to make any loan that the bank thinks is unsafe"?

It's like eating your cake and having it too.

 

[metatron]

Newtered

Most viscious attack on my soul since the US Senate election in Nevada, 2010.

 

[Cutlass]

How does it both "make banks cease to ignore the poor and colored" while at the same time "it does not force them to make any loan that the bank thinks is unsafe"?

It's like eating your cake and having it too.

Only if you force the loans to low income people to be equal to unsafe loans. And there is no reason to do that. Banks were not refusing to loan to these people because it was unsafe. They were refusing to loan to those people because they were colored.

http://www.fdic.gov/news/news/speeches/archives/2008/chairman/spdec1708.html

The FDIC, which is in charge of taking control of failed banks, says that CRA is not the problem.

Remarks by FDIC Chairman Sheila Bair to The New America Foundation conference: "Did Low-income Homeownership Go Too Far?": Washington, DC
December 17, 2008

Good morning and thank you for inviting me to speak.

What I'd like to do today is bury two myths that have been circulating lately. The first myth is that the Community Reinvestment Act caused the financial crisis. And the second myth is that working with troubled homeowners to reduce foreclosures lacks urgency and may be akin to a fool's errand.

CRA as a scapegoat

I think we can agree that a complex interplay of risky behaviors by lenders, borrowers, and investors led to the current financial storm. To be sure, there's plenty of blame to go around. However, I want to give you my verdict on CRA: NOT guilty.

 

[kochman]

It is a myth that CRA caused the problem.
I never said it caused it.

I said it contributed to the depth of the problem.
In fact, I said the subprime situation was the major culprit (and the repeal of Glass-Steagal).

 

[Cutlass]

It didn't "contribute" enough to even bother being mentioned. Not in the top 20 causes at the least.