The Truth as to what caused the Economic Collapse? The Facts!
Tuesday, March 12th, 2013 @ 5:10PM
The Subprime Home Loan “Scheme” collapsed the housing industry, which was the backbone of the United States Economy. The legislation that brought down the house, so to speak, was the Community Reinvestment Act.
First Enacted by President Jimmy Carter in 1977, it seemed to be a noble piece of legislation that sought to deter private banks from “red lining” certain neighborhoods and districts wherein high crime and vacancies were common. But in reality, it was unrealistic to think that a bank would make a home loan to those who had no means to repay the loans, let alone the inherent problem with home values.
For the twelve years of the Reagan and Bush 1 Presidencies, the Community Reinvestment Act legislation sat on a shelf growing dust. Republican’s had no interest in controlling the housing industry, after all, our nation was based on the free markets.
That all changed in 1994 while Bill Clinton we in office. He initiated what he called “The National Home-ownership Strategy: Partners in the American Dream. He directed then Secretary of HUD (Housing Urban Development) Henry Cisneros to come up with a “plan” where everyone could get into a home no matter what income level they were at or what their credit history was.
The Federal National Mortgage Association, commonly known as Fannie Mae, was founded in 1938 during the latter part of the Great Depression as part of the New Deal. Congress created Fannie Mae, in reaction to a shortage of mortgage financing. Private banks were the traditional home lenders and lost a lot of money during the Great Depression. This loss of money severely restricted the amount and number of home loans they would originate. Fannie Mae filled the void by offering to purchase mortgages originated by these private banks, thus encouraging banks to make such loans. Thus the corporation’s purpose is to expand the secondary mortgage market by securitizing mortgages in the form of mortgage-backed securities (MBS), allowing lenders to reinvest their assets into more lending.
From its inception Fannie Mae set the rules and established the terms as to what the pre-qualification’s had to be if they were to buy a loan. The mainstream media, under the control of George Soros, has attempted to put the blame for the lax “loan requirements” on the backs of the private sector banks, which is a complete falsehood.
The blame lies only with Fannie Mae. If the banks brought a loan that did not meet the pre-qualification’s set by Fannie Mae, then Fannie Mae would not buy the loan. Instead it was Fannie Mae who notified the banks that they would buy loans made to low income minorities without the usual documentation requirements, or credit verification’s or cash down payments. They were in essence the no credit, no cash, no citizenship, no problem loans.
This was validated by a study conducted by Harvard University’s Joint Center for Housing Studies. The study showed that home ownership exploded for the minorities during this time. Hispanic loans for instance jumped by a whopping 87.2%, and loans to African American’s jumped by 72%.
It was not due to a sudden explosion of the minorities landing high paying careers, or magically establishing excellent credit ratings, it was merely due to the aggressive desire by the Government to make home loans to millions of low income minorities that could have never qualified for a loan under conventional qualifications.
The Scheme was to “hand out” millions of these loans to ensure that when the inevitable defaults and foreclosures began to surface that it would have a big enough negative impact to destroy the backbone of the U.S. economy, the housing industry.
The variable Subprime loan interest rates provided the necessary mechanism to ensure the delay. The initial house payments for these loans were based on 0% interest only payments which would keep the payments low for a period of years. The payments were equivalent to a low income apartment, even though it was for a new home.
Years later, however, the higher variable rates kicked in and the resulting payments became too high for the loan recipient to meet. The rest is history – our economy collapsed, and everyday another house is lost to foreclosure. Millions of people now owe more than their house is worth.
To fully grasp how and why the Subprime Home Loan Scheme was solely responsible for not only destroying the Housing Industry, but also the U.S. economy, there are certain facts which first need to be understood, and an obvious question answered:
Okay, why would Bill Clinton and company want to destroy the economy of the United States? It is a very important and understandable question, but also a fairly easy one to answer.
First, one must come to know who Bill and Hillary Clinton really are. They are not the people that the media has sold them off as. They are committed to the United Nations and the One World Government.
You will need to trust me on this, there will be many resources provided where you can validate the fact that yes, they are both very committed Marxists, and they have aspirations that go way beyond the White House.
Here are a few quotes from Hillary:
“We’re going to take things away from you on behalf of the common good.”
“It’s time for a new beginning, for an end to government of the few, by the few, and for the few….and to replace it with shared responsibility for shared prosperity.”
“We…can’t just let business as usual go on, and that means something has to be taken away from some people.”
These statements are eerily similar to many of Barack and Michelle Obama proclamations!
That is because they are all committed to one ideology. They are linked by the same people and organizations, including George Soros, who has funded their campaigns and helped put them into the White House and Secretary of State positions.
Now that we understand that the primary objective for the Clinton’s Obama’s, and George Soros is to establish a One World Government under the Rule of the United Nations, then what must first be done in order to accomplish this?
The United States of America is the most wealthy and powerful nation on earth. For George Soros to achieve his aspirations, he would need to tear down America from all her Glory.
Soros, now in his 80′s has spent the past thirty years chasing this dream. He desperately wants to see it come to fruition before his life is over. The Clinton’s most definitely set the course in motion via the Subprime Home Loan Scheme, which after all, did succeed in not only toppling the Housing Industry, but also the entire U.S. economy!
Once the housing market crashed and the housing values plummeted, sending over 14 million homes into foreclosure, 30,000 small businesses associated with the Housing Industry went out of business, sending 6 million people to the unemployment line.
Bill Clinton also appointed Franklin D. Raine’s as CEO of Fannie Mae in 1998, where he remained through 2004. Raine’s aided Bill Clinton in insuring that the Subprime Home Loan Scheme was fully implemented “before” anyone would know the wiser as to what was about to unfold!
To validate the level of corruption and deceit Clinton embedded in our government, and its agencies, more specifically, Fannie Mae, and Franklin D. Raine’s, CEO 1998-2004, please note the following;
In May of 2006 the Office of Federal Housing Enterprise Oversight (OFHEO) issued the report on its three year investigation of the Federal National Mortgage Association (Fannie Mae). The acting director of OFHEO, James B. Lockhart, said
“Our examination found an environment where the ends justified the means. Senior management manipulated accounting, reaped maximum, undeserved bonuses, and prevented the rest of the world from knowing.”
The report charged that the reported earnings from 1998 to mid-2004 were bogus values generated by erroneous accounting practices. These fraudulent earnings then were used to justify enormous bonuses for the senior management. The extent of the fraudulent accounting profits was a mind-boggling $11 billion. The sizes of the undeserved bonuses were not just millions of dollars, or even tens of millions of dollars. Instead they were hundreds of millions of dollars.
Where was Obama during the mid 1990′s while Bill Clinton, and his appointees were implementing the Scheme that would eventually destroy the economy? Obama was in Chicago working for a Law Firm, and Obama’s primary client at the time was ACORN. Obama was suing those private sector banks that refused to make the Toxic Loans mandated by Clinton, using the Clinton Mandates as his weapon against the banks.
Yes, Obama aided Clinton in the quest to tear down the Housing Industry. We noted earlier that Jimmy Carter enacted the Community Reinvestment Act legislation in 1977. Then in 1994 Bill Clinton re-enacted the Community Reinvestment Act but this time he lined with powerful mandates that gave the government power to shut down those banks that refused to make so many of the so called “red line” loans. In 2009, Barack Obama enacted his own version of the Community Reinvestment Act. He called it the American Recover and Reinvestment Act.
The first four years of the Obama Administration were never about stimulating and restoring our economy, it was to ensure that it never would be restored. The policies of both Clinton and Obama have been designed to eradicate Capitalism from our nation. They want to embed Marxist policies that in the end will transfer all control of all Industries to the Government.