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  1. #1 Bank implosions proof that Affirmative Action doesn't work 
    Senior Member OwlMBA's Avatar
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    The banking failure we are seeing right now is actually a great example of Affirmative Action at work. Several years ago the banks teamed with inner-cities such as Cleveland and Detroit to create a way to "reach out to the community". In other words, to find ways to get people to move into the inner-cities and to give loans to people that could not otherwise get loans.

    Every bank you could think of used this as a chance to look really "progressive" and "politically correct" and jumped at the chance. Lehman Brothers backed mortgage companies giving loans to minorities and others with horrible credit. NationalCity bank actually partnered with the city of Cleveland to essentially "guarantee" financing for someone willing to live within certain parts of the city.

    In fact, the whole catalyst to "subprime loans" was actually an attempt by the banks to look hip and urban and progressive and reach out to the minority community that long complained about being ignored by banks.

    And look where it got us.

    When you have millions of people that previously could not buy a home suddenly in the home market, all home prices go up. Demand for homes skyrocketed. And just like a "rising tide lifts all boats", all home values surged as you suddenly had millions of new buyers in the market with no credit, no down payment, no steady income, and pre-approvals for $500k loans.

    McMansion builders like Dominion Homes, MI, and dozens of others, advertised on Hip Hop radio stations non stop encouraging people to "buy a home for less than you pay in rent." That was a lie, of course, because it was only less for a year or so and then your mortgage payment shot up. But people wanted to believe they could be a homeowner, so they jumped in.

    And just like in the dot com days, nobody wanted to be left out, so every investment bank and megabank jumped in and started backing these mortgage companies.

    20 years ago the foreclosure rate among African Americans was higher than any other group. It still is, but now it is much, much higher than it was then. Much of the reason is because mortgage companies would help them get a loan, and even lie on the applications. They didnt care because it wasnt their money. They were underwritten by someone else. And the hedge funds and banks that were pumping money into mortgages because it was the "trendy thing to do".

    And now, once again, all American taxpayers, and especially those in the upper-income brackets, get to pay to bail out the irresponsible home buyers and the idiotic banks. Both are equally at fault.
    **** Obama and **** you too.
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  2. #2  
    Eyelids
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    Of course, it all comes back to those fuckin' black people. Heaven forbid anybody in power is responsible for anything. Poor black people, the root of all our nation's problems.
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  3. #3  
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    ...irresponsible home buyers and the idiotic banks. Both are equally at fault.
    The banks never should have loaned money to them ... especially those balloon and interest only loans that gave people far more house than they would normally qualify for.

    I don't want to see anyone bailed out, let the banks fix it by refi to give the homeowner a more affordable payment over 30 years at a fixed rate. Every effort should be made to keep the families with their homes!
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  4. #4  
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    Quote Originally Posted by OwlMBA View Post
    The banking failure we are seeing right now is actually a great example of Affirmative Action at work. Several years ago the banks teamed with inner-cities such as Cleveland and Detroit to create a way to "reach out to the community". In other words, to find ways to get people to move into the inner-cities and to give loans to people that could not otherwise get loans.

    Every bank you could think of used this as a chance to look really "progressive" and "politically correct" and jumped at the chance. Lehman Brothers backed mortgage companies giving loans to minorities and others with horrible credit. NationalCity bank actually partnered with the city of Cleveland to essentially "guarantee" financing for someone willing to live within certain parts of the city.

    In fact, the whole catalyst to "subprime loans" was actually an attempt by the banks to look hip and urban and progressive and reach out to the minority community that long complained about being ignored by banks.

    And look where it got us.

    When you have millions of people that previously could not buy a home suddenly in the home market, all home prices go up. Demand for homes skyrocketed. And just like a "rising tide lifts all boats", all home values surged as you suddenly had millions of new buyers in the market with no credit, no down payment, no steady income, and pre-approvals for $500k loans.

    McMansion builders like Dominion Homes, MI, and dozens of others, advertised on Hip Hop radio stations non stop encouraging people to "buy a home for less than you pay in rent." That was a lie, of course, because it was only less for a year or so and then your mortgage payment shot up. But people wanted to believe they could be a homeowner, so they jumped in.

    And just like in the dot com days, nobody wanted to be left out, so every investment bank and megabank jumped in and started backing these mortgage companies.

    20 years ago the foreclosure rate among African Americans was higher than any other group. It still is, but now it is much, much higher than it was then. Much of the reason is because mortgage companies would help them get a loan, and even lie on the applications. They didnt care because it wasnt their money. They were underwritten by someone else. And the hedge funds and banks that were pumping money into mortgages because it was the "trendy thing to do".

    And now, once again, all American taxpayers, and especially those in the upper-income brackets, get to pay to bail out the irresponsible home buyers and the idiotic banks. Both are equally at fault.
    Yep. We just had a huge transfer of wealth. It worked out really well, didn't it? Someone got to live in a house for a bit, and we get to pick up the tab.
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  5. #5  
    Senior Member LogansPapa's Avatar
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    The Affirmative Action excuse is utter bullshit.

    My daughter-in-law just left that business after five years of free-wheeling action and has told me that no one - even if they’re purple - gets a loan unless a loan officer turns a blind eye to their ability to pay.

    In the real world (one I’ve been used to for the past 30 years), which we’re back to now, 20-25% down and a virgin credit rating are a prerequisite for any kind of home loan.

    Most financial institutions got caught playing a stupid shell game and now everyone’s whining about how they got into this situation. This isn’t a ‘give a black family a chance to own their own home thing.’ It’s a phoney paper-trail unconfirmed income greed-fest.

    The Piper’s come for payment.
    At Coretta Scott King's funeral in early 2006, Ethel Kennedy, the widow of Robert Kennedy, leaned over to him and whispered, "The torch is being passed to you." "A chill went up my spine," Obama told an aide. (Newsweek)
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  6. #6  
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    Quote Originally Posted by Eyelids View Post
    Of course, it all comes back to those fuckin' black people. Heaven forbid anybody in power is responsible for anything. Poor black people, the root of all our nation's problems.
    Not all, but on a proportional basis a big chunk. Think prison population ratios. :eek:
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  7. #7  
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    Quote Originally Posted by lacarnut View Post
    Think prison population ratios. :eek:
    At Coretta Scott King's funeral in early 2006, Ethel Kennedy, the widow of Robert Kennedy, leaned over to him and whispered, "The torch is being passed to you." "A chill went up my spine," Obama told an aide. (Newsweek)
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  8. #8  
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    Quote Originally Posted by Eyelids View Post
    Of course, it all comes back to those fuckin' black people. Heaven forbid anybody in power is responsible for anything. Poor black people, the root of all our nation's problems.
    I don't think Owl is blaming 'black people'. The gist I got from the OP was what I've been led to believe all along - stupid lending institutions making stupid loans. As to blaming people "in power", that's exactly what he seems to be suggesting. I don't recall 'black people' passing any Affirmative Action legislation.
    Nothing helps a bad mood like spreading it around.
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  9. #9  
    Senior Member Rebel Yell's Avatar
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    My wife audits all the HMDA forms at the bank where she works. She says that if you turn down a loan to a minority, you damn well better have it documented for good reason. One of the main things they look at is how many minorities the bank turns down. It don't look good if the bank turns down alot of minorities. They focus more on hispanics than blacks. As a matter of fact one of the check boxes is Hispanic or non Hispanic.

    I think what Owl is trying to say ain't that it's black people's fault. It's the fact that these loan companies have to meet there own "quota" of loans to minorities to keep the fed off their asses. So they have to give loans to people who ordinarily wouldn't qualify (at least here). That is where the problem lies.
    I feel that once a black fella has referred to white foks as "honky paleface devil white-trash cracker redneck Caspers," he's abdicated the right to get upset about the "N" word. But that's just me. -- Jim Goad
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  10. #10  
    Eyelids
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    OwlMBA refuses to admit wealthy whites are at fault for anything.
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