The Genesis Of The Credit Crisis

Make no mistake, Congress will try to either ignore or gloss over the mistakes made that put us into a situation where the American tax payer will be on the hook for a trillion dollars (that numbere still boggles the mind) to right the listing financial ship we are sailing today. Already Democrats are trying to lay the blame on President Bush. But make no mistake, this financial fiasco keeps coming back to Democrats like Bill Clinton, Barney Frank, Chris Dodd and yes even Nancy Pelossi. They were duly warned as early as 2004 and instead chose to do nothing. I have posted on this below.

Here are two articles from our morning guy Ray Dunaway that are must reads. One by Kevin Hassett of the AEI

Back in 2005, Fannie and Freddie were, after years of dominating Washington, on the ropes. They were enmeshed in accounting scandals that led to turnover at the top. At one telling moment in late 2004, captured in an article by my American Enterprise Institute colleague Peter Wallison, the Securities and Exchange Comiission’s chief accountant told disgraced Fannie Mae chief Franklin Raines that Fannie’s position on the relevant accounting issue was not even “on the page” of allowable interpretations.

And Ray links to this NY Times article from 1999. Get a load of the date and this headline:

September 30, 1999

Fannie Mae Eases Credit To Aid Mortgage Lending

By STEVEN A. HOLMES

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

Finally … HotAir has a very good roundup and analysis as well.