Saturday, October 11, 2008

Racism & Liberalism: The Cause of U.S. Sub-Prime Loan Crisis

http://journals.aol.com/davidhalko/politics/entries/2008/02/25/racism--liberalism-the-cause-of-u.s.-sub-prime-loan-crisis/482

Monday, February 25, 2008
2:06:00 PM EST
Feeling Frustrated Racism & Liberalism: The Cause of U.S. Sub-Prime Loan Crisis

The world has been hearing about the "Sub-Prime Loan Crisis" in the United States, and it's effect on the national and now world economy.


The root cause of this crisis is abuse offered by "The Community Reinvestment Act".

What does the Federal Reserve of the United States say about the CRA?

United States Federal Reserve web site describing the Community Reinvestment Act
The Community Reinvestment Act is intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods. It was enacted by the Congress in 1977 (12 U.S.C. 2901) and is implemented by Regulation BB (12 CFR 228).
...
Nor does the law require institutions to make high-risk loans that jeopardize their safety. To the contrary, the law makes it clear that an institution's CRA activities should be undertaken in a safe and sound manner.

The problem is that the details of the law are very different from this feel-good summary given to the public.

The United States in 1977, former President Democrat Jimmy Carter, a law was passed by the former Democrat controlled United States Congressional Legislature.

Community Reinvestment Act of 1977 - 1977-10-12
SECTION 803-Definitions
...(3) the term "application for a deposit facility" means an application to the appropriate Federal financial supervisory agency otherwise required under Federal law or regulations thereunder for
(A) a charter for a national bank or Federal savings and loan association;
(B) deposit insurance in connection with a newly chartered State bank, savings bank, savings and loan association or similar institution;
(C) the establishment of a domestic branch or other facility with the ability to accept deposits of a regulated financial institution;
(D) the relocation of the home office or a branch office of a regulated financial institution;
(E) the merger or consolidation with, or the acquisition of the assets, or the assumption of the liabilities of a regulated financial institution requiring approval under section 18(c) of the Federal Deposit Insurance Act or under regulations issued under the authority oftitle IV of the National Housing Act; or
(F) the acquisition of shares in, or the assets of, a regulated financial institution requiring approval under section 3 of the Bank Holding Company Act of 1956 or section 408(e) of the National Housing Act.
It basically means that this legislation and regulation applies to the bank trying to grow their business in order to make up for attrition or expand a successful business.

Imagine trying to run a business where you have a competitor moving into a new area and your bank is not allowed to expand into that area. As people start to see that their bank is not in the places where they normally go, people realize that they can not get access to their money easily - and they leave your bank.

If the bank does not follow the regulation, it is basically the "death knell" for the bank - the Federal Government is threatening to suffocate the bank out of business by denying the bank customers.

Back to the regulation...
SECTION 804-Financial Institutions; Evaluation
(a) In general. In connection with its examination of a financial institution, the appropriate Federal financial supervisory agency shall-
(1) assess the institution's record of meeting the credit needs of its entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of such institution; and
(2) take such record into account in its evaluation of an application for a deposit facility by such institution.
For the banking institution to survive as a financial entity in the Free Market - a subjective analysis must be done by the Federal Government, in order to see whether a bank is meeting a "credit needs of its entire community".

What happens if they do not?

The bank will be suffocated by the Federal Government.

What is at the root of this legislation?

Back to section 804...

(b) Majority-owned institutions. In assessing and taking into account, under subsection (a), the record of a nonminority-owned and nonwomen-owned financial institution, the appropriate Federal financial supervisory agency may consider as a factor capital investment, loan participation, and other ventures undertaken by the institution in cooperation with minority- and women-owned financial institutions and low-income credit unions provided that these activities help meet the credit needs rating of local communities in which such institutions and credit unions are chartered.
Race and Gender is called into question of the employees of the bank?

If you are part of a bank wanting to expand your business and you are the wrong race or gender - you can fix your gender or race problem by writing risky loans to "help meet the credit needs rating" in your community.

The name of this type of loan, which people are getting accustomed to, in the 2008 is "Sub-Prime Loans".

If you are the wrong race or gender, you have to write bad loans in order to keep your bank from being suffocated by the Federal Government.

Let' continue with Section 808 of the law...
SECTION 808-Operation of Branch Facilities by Minorities and Women
(a) In the case of any depository institution which donates, sells on favorable terms (as determined by the appropriate Federal financial supervisory agency), or makes available on a rent-free basis any branch of such institution which is located in any predominantly minority neighborhood to any minority depository institution or women's depository institution, the amount of the contribution or the amount of the loss incurred in connection with such activity may be a factor in determining whether the depository institution is meeting the credit needs of the institution's community for purposes of this title.
You have to love this one: if a bank loses money, your bank will not be starved to death.

This is a good one, too: if you turn over ownership or management of a branch to someone based upon the "correct race" for that community or turn over ownership of a branch to a "better gender" - then the Federal Government will not starve the bank to death.

What exactly is a "minority"?
...The term "minority" means any Black, Native American, Hispanic American, or Asian American.
The racists are at it again.

Penalizing people for their ethnic background is a poor way to run any business, never mind a nation.

Who actually benefited from this law?

Not the lower-income citizens, who were supposedly to benefit, because they have been defaulting on their loans and losing their homes.

Not the banks, which were coerced to provide bad loans, because they have been under tremendous pressure to keep from going out of business due to the citizens who were defaulting on their loans.

Only theliberal racists, who used the power of the federal gun, were the ones who benefited from this system.


Remember the Liberal activist group, ACORN (Association of Community Organizations for Reform Now), perpetrators of voter fraud across the United States?
Rotten Acorn: Democratic Voter Fraud Map and History

What does the continual illegal voter fraud activities of ACORN have to do with the CRA?

Follow the money... how is ACORN funded for their voter fraud? Where do they get their money from? Who receives the benefits for the voter fraud on a multi-state level?

Apparently, ACORN abuses this Carter/Democratic legislation by organizing followers of their special interest group to complain to the regulatory agency, to starve banks which did not donate money to their politically affiliated community groups or perform enough bad loans to their politically affiliated community group followers.

Founded in 1970, ACORN successfully lobbied the the Democratic Party in 1977, to create an indirect funding mechanism, in which political activities would be donated in return, which apparently included voter fraud.
Lew Rockwell: The Government-Created Subprime Mortgage Meltdown - 2007-09-06

So-called "community groups" like ACORN benefit themselves from the CRA through a process that sounds like legalized extortion. The CRA is enforced by four federal government bureaucracies: the Fed, the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. The law is set up so that any bank merger, branch expansion, or new branch creation can be postponed or prohibited by any of these four bureaucracies if a CRA "protest" is issued by a "community group." This can cost banks great sums of money, and the "community groups" understand this perfectly well. It is their leverage. They use this leverage to get the banks to give them millions of dollars as well as promising to make a certain amount of bad loans in their communities.

A man named Bruce Marks became quite notorious during the last decade for pressuring banks to earmark literally billions of dollars to his organization, the "Neighborhood Assistance Corporation of America." He once boasted to the New York Times that he had "won" loan commitments totaling $3.8 billion from Bank of America, First Union Corporation, and the Fleet Financial Group. And that is just one "community group" operating in one city – Boston.
Now, all of America will pay for the liberal extortion from private banks in their tax dollars - and the world economy will suffer from this failed Racist Experiment.

People should not be considered a superior job candidate based upon gender - this is bigotry.

People should not be considered a superior job candidate based upon the color of their skin - this is racism.

The government should not be allowed to pass legislation to pay for Political Special Interest Groups to keep any political party in power - this is corruption.

Money should be loaned with a percentage rate based upon their income and history demonstrating the discipline to pay the loan back - this is fiscal responsibility.

This goes to show you how votes cast (or uncast) 35 years ago adversely affected Americans and The World now, as well as the children of those original voters.


Tags: Liberal, Democrat, Voter, Fraud, Sub, Prime, Loan, Crisis, Racism, Racist, ACORN

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