Re: The FCIC falls apart

On Dec 16, 2010, at 6:34 PM, Karl wrote:

> Not really.  The CRA affected private banks too, not just fannie.

The CRA only applied to commercial banks.  It was a huge loophole that  
the investment banks and non-bank lenders exploited.  The vast  
majority of subprime lending was originated from these institutions  
that didn't have to follow CRA.  But as it turned out, the CRA loans  
had a better default rates than the NINJA loans that the private  
industry flooded the market with.

regards,
-Lance


>
> Point is that if it caused loans to be issued to high risk people it
> contributed.
>
> Found this which makes some good points in both directions.
>
>
> -----Original Message-----
> From: [email protected] [mailto:[email protected]]  
> On Behalf
> Of Lance McLain
> Sent: Thursday, December 16, 2010 4:30 PM
> To: DADL (off topic)
> Subject: Re: [DADL-OT] The FCIC falls apart
>
>
> On Dec 16, 2010, at 5:57 PM, Karl wrote:
>
>> " the long-standing and harmless Community Reinvestment Act"
>>
>> Harmless?  Really?
>
>
> Actually, not only harmless, but perhaps even helpful, according to  
> this article
> (at the end).
>
> regards,
> -Lance
>
> http://www.mcclatchydc.com/2008/10/12/53802/private-sector-loans-not-fannie.html
>
> Private sector loans, not Fannie or Freddie, triggered crisis
>
>
>
>
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