Sunday, March 08, 2009

Doug Ross breaks this down, once and for all. If someone else has a better explanation (or thinks they do), I would love to hear it.
This is the private switching system, utilized by the Federal Reserve, that performs electronic financial transfers.

This is the vault that holds sixty billion of the taxpayers' dollars, which moved to an account owned by American International Group (AIG).

This is troubled insurance giant AIG, a company whose financial instruments undergird much of the world's financial system.

This is an eight-year stock chart of AIG, laid low by the collapse of housing giants Fannie Mae and Freddie Mac, and which requires tens of billions in taxpayer bailouts.

This is housing giant Fannie Mae, described by pundits as a "job shop for out-of-work Democrats."

This is Fannie Mae's stock price, the collapse of which devastated the capital-to-asset ratios of banks and insurance companies like AIG (which held five billion dollars in Fannie Mae and Freddie Mac equities).

These are Democratic operatives Franklin Raines, Jamie Gorelick and Jim Johnson, the executive management team of Fannie Mae, all of whom were awarded positions after loyal service in the Clinton administration.

These are the pay packages the Democrats awarded themselves, through undeserved bonuses, immense salaries and incentive payments, all based upon pushing huge numbers of subprime loans through Fannie Mae.

These are the total campaign contributions ("investments") Fannie Mae executives made to Democratic Senators Chris Dodd, Barack Obama and John Kerry in order to "fix" federal regulation.

This is a list of the attempts made by the Bush administration starting in 2001 to rein in the out-of-control spending frenzy by Fannie and Freddie.

This is one such hearing in 2004 (YouTube video available), wherein Republicans demanded additional oversight of Fannie Mae and Freddie Mac because of the GSEs' rampant accounting scandals, inadequate capital reserves, inappropriate bonuses and hundreds of billions in low-income, no documentation mortgages.

This is Maxine Waters (D-CA), complaining that there is no crisis at Fannie and Freddie; and that attempts to audit the GSEs simply disenfranchise the poor by preventing them from getting subprime mortgages.

This is Barney Frank (D-MA), claiming that Fannie Mae and Freddie Mac are fine and that oversight is not needed.

These are other Democratic members of Congress.

Each of whom resisted call after call after call to regulate the GSEs, falsely blaming racism, hatred of the poor and redlining -- all on a straight party line.

This is Chris Dodd (D-CT), the powerful member of the Senate Banking Committee, who threatened filibuster after filibuster over additional regulation of the mortgage market (while accepting funds and sweetheart mortgages from the very organizations he was supposed to be regulating).

These are the organizations that profited from subprime mortgages, sold to unqualified individuals -- even those without documentation of citizenship, income or assets -- knowing they could sell the loans to the GSEs. For example, Fannie even accepted a $700,000 mortgage application from a migrant with an annual income of $14,000.

This is President Clinton signing the Community Reinvestment Act (CRA), which forced banks to write low-income, zero documentation loans. These loans would then be purchased by Fannie and Freddie and securitized for sale to other financial institutions.

These are the community agitators -- primarily organized through ACORN -- who falsely accused banks of "redlining" (failing to offer mortgages to the urban poor). These groups would pack bank lobbies and harrass customers and employees in order to intimidate the institutions and force the government to strengthen the CRA.

This is the community agitator and ACORN attorney named Barack Obama, who sued Citibank in 1994; one of hundreds of nuisance lawsuits filed by ACORN and its affiliates to loosen mortgage underwriting standards.

These are the Democrats who profited at every step of the mortgage meltdown while blaming George W. Bush for the crisis, and whose continued oversight of the financial system is a disgrace and a mortal danger.

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