AND WE WONDER WHY THE ECONOMY IS SUCH A MESS….
Nice work on Friday by CNBC who called out Barney Frank for being a liar and a fraud. As we’ve previously shown, Barney Frank (THE CHAIRMAN OF THE HOUSE FINANCIAL SERVICES COMMITTEE) is very confused about the actual workings of our monetary system. In addition to this, Frank has now been proven entirely wrong on his position in housing and has actually lied in public about his position on housing. And we wonder why the economy is so screwed up?
Here is Frank saying he didn’t push for housing just last week:
And here is Frank in 2005 saying there is no bubble in the housing market and that subsidizing home ownership is a good plan:
This is an elected official and the Chairman of the House Financial Services Committee. You can’t make this stuff up….And people wonder why the economy is such a mess. Does Barney Frank really understand anything about finance?
It’s terrible that we have all of these people in positions of power who have no idea what they’re doing. How does this happen? How does a life long professor become the most powerful banker in the world? How does Frank become chairman of the finance committee?
wait i just realized it – because the people nominating them know even less than they do.
That sums it up….
It happens because we elect people to do jobs of importance instead of hiring them. I think we should consider something else in the future to replace politics and voting. It doesn’t work anymore.
Never mind all the Mumbo Jumbo! Stocks will advance tomorrow, buy on any dip and sell after 1% rise! Easier money could not be had!!!
No additional comment needed. Nice clip find.
It’s such a damaging clip. His arrogance is unreal. How can this man get re-elected?
He’s so arrogant, that if you confronted him with these two clips, he would still deny it says what it says. Whatever Mass. district keeps sending this scoundrel back to Congress should be ashamed of itself.
Oh, come on, don’t be so harsh to this guy. At least he can tell you what is in a bill, I think that is why he is chairman, most of his collegues don’t even read the bill they are voting for.
LZ: unless you are being ironic, this is a lame excuse. So according to you anyone who can read can be in BF’s position? ridiculous to say the least…
Frank has no idea what he is doing. Why should anyone cut him a break? His comments on housing in 2005 are so ignorant and now he has the balls to say he didn’t say it?
I’d be more forgiving is he just owned up to his mistakes, but now he is just a liar
and, … his comments reflect the position of the whole Republican Party congressional delegation, along with the President & his administration … Republican’s empower the wealthy & power elites to run roughshod over the majority’s best interests.
Actually, it was Glenn Beck that nailed him on this Wednesday or Thursday. CNBC is just about incapable of real journalism and is just this side of unwatchable. Dennis Kneale is totally ignorant to all things economic, Mark Haynes is a relic (as is Bartiromo), Ron Insana is laughably terrible, Erin Burnett and Trish Reagan are the ditsy sorority sisters, Cramer…lol do I even need to say anything? and Simon Hobbs, who showed so much promise in the beginning, has been sucked into the malaise. Rick Santelli just needs to take over the whole thing and bring back Dylan Ratigan who is being assimilated by the liberal “borg” on MSNBC.
I’m not normally this negative or insulting, but it’s just reaching levels that make me want to pull out my hair. Bloomberg is rational and much more professional, but they are so darn boring. If they had a better morning show and better guests during the day they would shut CNBC down.
Well, my apologies to Fox then….
Those of us who have come to the conclusion that it is far to the other side of unwatchable have far less frustration (plus we are keeping all of our hair).
LOL quite true Leland. Thank God for my mute button.
I’m watching Fareed Zakari’s interview of William Bowder on how criminals in Russia working with corrupt Russian officials forged transfer of ownership documents of Mr Bowders companies then declared the companies had falsified tax documents showing profits instead of the losses they now claim allowing the new company to receive well over 200 million of tax refunds. Then the comment was made that they were cannibalizing on their own citizens by asking and receiving a tax refund.
I watch how our government and private corporations behave within the US and its all the same form of behavior. Fraud is fraud. I don’t see a great deal of difference between how Russia operates its affairs by ripping off the citizens and how our government, wall street and corporations are treating the US taxpayer WITH the exception that Russia conducts itself like street thugs and Americans conduct themselves like elitists .
We should all be bald.
Will Rogers said it all=====congress “the best people money can buy”
I’m not a fan of politicians (who is?) but this shot at the guy seems to be a bit cheap.
You can probably find contradicting expressions about something from anyone over the course of 5 years. And for most politicians you can find this over the course of a lot shorter time, having to go back as much as 5 years is pretty good in fact.
Why would anyone even dream or have the fantasy that self-serving politicians have even the slightest understanding of financial matters? A third grader probably has a better understanding than Mr. Frank.
This is why I disagree with Democracy. Did anyone notice that Frank’s lisp isn’t nearly as bad in 2005?
This guy should be classified as a WMD. If subprime lending had a sleezy ignorant backpeddling manipulative forefather – this would be him. If there’s one definitive person to pin the blame on for this financial crisis – well it’d have to be Greenspan but only because he risdes only a little known black hole known as Barney Frank.
Did I mention he has been consistently in the top 10 recipients of campaign financing by FRE and FNM?? This choice alone makes me lose all respect for Obama.
“This choice alone makes me lose all respect for Obama.”
Care to explain that?
My explanation is that the appointment of someone who is at the very heart of the subprime issue (and thus, a cause of this monumental issue) to head the House Financial Services committee shows me that Obama was more concerned with his political agenda than electing someone who considers himself completely unaccountable and infallible when everyone knows the truth.
I’ve said it before but back in the late 90s, Barney Frank repeatedly exploited the notion that denying non-conforming borrowers access to credit for home purchases was a direct attempt by the Republican party at instituting a racist agenda. He successfully helped engineer and pass legislation REQUIRING Fannie/Freddie to INCREASE their subprime holdings – all the while collecting MILLIONS of campaign donations from these companies. Now these two companies represent one of the largest liabilities on the books of the Federal Government and are ONCE AGAIN asking for help.
But most importantly, I’ve watched Barney Frank “debate” and this guy NEVER admits to a single fault and always reverts to attacks on any conservative agenda so as not to expose (or even admit) to his mistakes. He has no tact and no respect for anyone – which insures that issues like these will continue to occur. Someone needs to start a “Politicians Anonymous” group where these talking heads are FORCED to attend after massive government failures and their first task at hand is ADMITTING there is s a problem.
I didn’t vote for Obama but I will say t hat I HOPED he would bring a level headed view on the issues at hand. Instead, he seems to be getting more arrogant in the face of repeated populist moment against him – with his largest base (voters in my age group) dropping their support for him by almost half….because they believed in him and are sitting on the sidelines unacknowledged and unemployed with no entitlement programs even helping to support them(Gen-Y, people born after 1980 represented a huge force that elected Obama – and are now sitting at a 19.2% unemployment rate as a group).
Unless I’m mistaken, you’ll find that Obama has not appointed Barney Frank to anything.
“This is an elected official and the Chairman of the House Financial Services Committee. You can’t make this stuff up….And people wonder why the economy is such a mess. Does Barney Frank really understand anything about finance?”
That’s irresponsible. Anyone that knows anything about finance and listens to Barney Frank KNOWS that he is VERY well versed on the working of finance. I love your website and value your opinion. But in this case you have exposed your ingnorance on this topic. Stick to what you know. You clearly do not know Barney Frank well.
Perhaps he does know a thing or two about finance. So does Dick Fuld. So what? What the clips illustrate beyond a shadow of doubt is that BF is lying through his teeth about his role in the creation of the housing bubble. For that alone he should be thrown out of office.
Dead on. The man is a liar. That alone makes him unfit to serve.
“The man is a liar. That alone makes him unfit to serve.”
That statement makes you look foolish.
No, the fact that you’re okay with it makes you look foolish. He is a bold faced liar. Caught red handed and you are defending this? Unbelievable.
Gregg, why do you insist on defending a clearly guilty man, with no evidence for your claims?
The disingenuous statements made by Frank are clear, and documented.
If you have opinions to the contrary so be it but why do you insist on insulting others without merit, or justification?
#1 I’ve never defended BF’s comments on the video’s. He clearly supported home ownership in 2005, contrary to his comments recently.
#2 What I defended was BF’s understanding of basic finance and how well versed he is on the current problems facing the financial industry and how they effect the economy.
#3 Suggesting that politicians should be thrown out of office if they attempt to rewrite the history of their past opinions is a ridiculous standard. I don’t support the practice – it’s wrong – but a large percentage of politicians do it and we simply have to hold them accountable for their positions. That doesn’t mean throwing them out of office. It means pressing them to give straight answers.
#4 In my opinion there is no one in either the House or the Senate with a better understanding of the current state of the American financial system than Barney Frank. He is acutely aware of the basics of finance as well as the minutia of the CDS market. I think it is ignorant and wrong to attack him for his apparent lack of financial knowledge and suggest “it’s no wonder we’re in such a mess”.
#4 If TPS is so smart and concerned he should do the tough work of trying to do something about it by putting forth solutions and getting them into legislation. It’s hard work – but there are people out there willing to try.
I value the information provided on pragcap.com but such an ignorant personal attack discloses an ugly side to an otherwise beautifully conceived and executed web site. I was greatly disappointed and was moved to express my wish that TPC stick to analysis of the data and the markets.
This is what is frustrating about the comment section here. I write a piece with stone cold facts and then people come and (almost always) attack my writing without stating a SINGLE fact. You have not posted one fact Gregg. I very much respect the comments here and I generally try to answer each question and engage in useful debate because it furthers everyone’s knowledge. But where are your facts?
Mr. Frank has repeatedly shown that he does not understand the monetary system. The most obvious of which was asking Bernanke if we will go bankrupt one day. More importantly, however, Mr. Frank was the primary proponent of pushing the sub-prime time bomb. He is the Dr. Kevorkian of the housing bubble.
Just a few quotes:
“I worry, frankly, that there’s a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities (Fannie and Freddie) that are fundamentally sound financially and withstand some of the disaster scenarios. . . .”
On subsidizing subprime:
“I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . ”
On Housing:
” I believe there has been more alarm raised about potential unsafety and unsoundness than, in fact, exists.”
“these two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis.”
You say he is some sort of financial whiz, but what is his background? Has he ever run a business? Has he ever been a banker? Has he ever worked on Wall Street? Does he even have a degree in finance? Anything? Does anything that this man has done in his life make him fit to serve as the highest ranking financial official in Congress? He’s a trained lawyer and politician posing as a financial expert. His few market calls over the last few years are clear evidence of his financial naivete.
For him to lie about all of this after the fact only throws gasoline on the fire. I don’t see how anyone can defend his actions. And I have never said he should be thrown out of office, but this has to make one very seriously question the people in charge….Is he truly qualified to be the house finance chairman?
“What I defended was BF’s understanding of basic finance and how well versed he is on the current problems facing the financial industry and how they effect the economy.”
Well, considering he’s the Chairman of the House Financial Services Committee, referencing his “understanding of basic finance” isn’t exactly a spirited defense, is it? I mean, a A first year MBA also has a basic understanding of finance. Is that your defense?
As for his appreciation for the current problems facing the economy, you are giving his far too much credit. He won’t even admit that for years leading up to the crisis he advocated an aggressive pro housing stance (while accepting boatloads of money from industry sources –easily sourced via a Google search)and resisted all efforts to regulate it, and he has been challenged REPEATEDLY on this and every time he denies any personal accountability and attacks the accuser. (Again, just Google “Frank and critics of role in housing crisis”)
“In my opinion there is no one in either the House or the Senate with a better understanding of the current state of the American financial system than Barney Frank.” Since this is your opinion, I’ll take it with a large grain of salt, but let’s say it’s true, then TPC headline still stands.
Your defense of BF reads like talking points handed out to his staff or his reelection committee. It contains no facts, no links, no data. Just talking points and personal opinion, in other words, nothing of any substance, much like BF I might add.
liberals get so indignant, how dare anyone question them.
Honestly, I think it’s not worth reasoning with you but here’s just my last tidbits on this issue:
1. Frank regularly insults conservatives and accuses them of some pretty heinous infringements. So what exactly is wrong with having a staunchly opposing position to him, much less stating the FACTS of what he’s done??
2. I think you are pretty bold to state that those on this thread stating facts (and also peppering in opinions) are “ignorant and [committing] wrong”. It is our DUTY to question our leaders and call them out on missteps – ESPECIALLY when they refuse to acknowledge such themselves. This isn’t a dictatorship, we’re not about silencing public opinion whenever its in opposition. Rather, we should be encouraging level headed and honest debate.
3. I will stand out here and say that I do believe he should be thrown out of office. He does a much greater harm and disservice than any good. But honestly, I’m thankful that we live in a democratic society where we get to CHOOSE who represents us and who doesn’t. He doesn’t need to be thrown out – here’s hoping the voters push him out. This guy could use a heavy dose of humility regardless.
4. He is NOT aware of the basics of finance. He does NOT have accute awareness of the minutae of CDS, derivatives, finance, moral obligation, greater good, humility, fortitude and every human being’s inherently flawed character
5. Calling out TPC and insulting his site (and posters) is completely unjustified and uncalled for. Furthermore, do you realize the enormous hubris in your statement:
“If TPS is so smart and concerned he should do the tough work of trying to do something about it by putting forth solutions and getting them into legislation. It’s hard work – but there are people out there willing to try. ”
…as YOU POST COMMENTS on HIS website which is geared SOLELY towards analysis and critique of the entire field of finance???? TPC hasn’t been elected by anyone or run for office (that I know of) and I’m guessing it’s probably not his main breadwinner – yet it comes at a benefit to us all regardless of if you choose to agree or disagree and certainly with great effort and cost (in time and money) at his expense. For example, despite your aggressive an insulting tone I feel even you have benefitted by at least reading some REAL facts about BF and thus gaining some knowledge. But if it bothers you so much, either present a cogent and respectful argument – or stop reading and move on.
unbelievable
Any bets on whether this guy gets reelected ?
My money says yes he does
Somebody knows Barney a little too well! eh schwinn? or is it sha-wing!!!
TPC your content is normally top notch, but here you’re attacking someone with no facts. You couple 1) a generic statement by Barney Frank saying he pushed rental houses with 2) a generic statement by BF where he said there was no bubble and in the last 2 seconds of the clip that he supported home ownership.
I’m not defending BF, maybe he deserves it. just saying you need some specific facts if you want to bash him. All politicians make generic statements which they change for their audience. big deal.
You also need to support your unspoken contention that politicians mouthing that they support home ownership was a significant contributor to the housing bubble. Note that Fannie/Freddie % of total mortgages dropped off in 2005/2006
Voting record is the proof in the pudding, Frank has also switched his assessments of Fannie and Freddie with the political wind. Ultimate airbag.
Come on. Are you denying that sub-prime was not a major player in the housing crash? He was the loudest proponent of sub-prime.
I hope you guys aren’t making this political because I have also trashed Bush for his support of housing….
Barney Frank repeatedly stated his position in favor of subsidizing low income housing and providing mortgages to borrowers with unworthy credit. He denied the housing bubble all the up until it blew up in his face. And then when it did he had the arrogance to blame it on the private sector and not the government (as that would have been a direct admission of guilt).
It’s sickening.
I’m not denying it’s sickening, or that our legislation contributed to the sub-prime bubble. Just that those kind of clips aren’t helpful. They just feed people’s anger who have no clue what’s going on, and distract them from what’s important. Zero information content.
Everyone on this site knows what happened, and what’s happening now. This isn’t FOX News or CNN. The one’s getting angry (myself included) are getting angry because it beggars belief that anyone would jump to defend Franks assertions that he had nothing to do with the creation of the housing crisis. It’s like a Bush supporter claiming he had nothing to do with Iraq.
Like I said people get angry, and they say things from their “gut” which have zero information content. Focus on facts.
If you believe Barney Frank single-handedly caused the 2008 financial crisis (which is what you allude to by comparison to Bush/Iraq war), please back it up with some facts. If you have sound reasoning grounded in fact, I will be persauded
To imply that most of us think BF caused the “2008 financial crisis” is completely ridiculous. There were many who contributed to this mess and I for one believe this started long before 2008. But the point in my opinion is this, for some ungodly reason we have people in very important positions of government, who have a tremendous amount of influence, who are somewhat incompetent with an uncanny ability to be unable to see the forrest through the trees. Call it what you want but this guy blew it and now he’s trying to rewrite history.
I never wrote that Frank, “single-handedly caused the 2008 financial crisis” You inferred that. Again, I wrote that “it beggars belief that anyone would jump to defend Frank’s assertion that he had nothing to do with creating the housing crisis.”
If my Bush reference so threw you that it caused you to completely misinterpret and rewrite my post, well, mea culpa I suppose, but it seems like you’re reaching for a way to redirect the conversation.
Good grief, are there more worthy people for you to spend you time defending?
Santelli said to look up this link,…..http://www.google.com/search?client=safari&rls=en&q=Fannie+Mae+Patron+saint,+barney+Frank,+Sept.+9,+2008&ie=UTF-8&oe=UTF-8 He came on after CNBC let Barney Frank go on and on telling lies. Santelli is the reason that channel has any integrity at all!
“Suggesting that politicians should be thrown out of office if they attempt to rewrite the history of their past opinions is a ridiculous”
Are you serious ?
Unaccountable actions are diferent from opinions.
Rewriting history is the privileges that unaccountable narcissistic sociopaths political have over there subjects.
“No lie is too big and no Machiavellian deception is too unscrupulous for the professional politician.”
Was democracy in america not suposed to be at the service of freedom instead of Power?
Are you denying that sub-prime was not a major player in the housing crash?
Coming from the perspective of someone who works in CRE, I would say yes, I am denying it.
Default rates have soared in all classes of loans, from prime downward. The issue wasn’t with the classes of borrowers, per se, but with the degree of leverage and the general lack of collateral.
Mortgage rates are predicated on the notion that collateral needs to be adequate for a lender to made whole in the event of default, with room for error, and the most popular loan products on the decade were utterly lacking in collateral. A lender should be able to make itself whole through foreclosure, otherwise the loan more closely resembles unsecured debt than it does a mortgage. A loan with inadequate collateral should be priced well above a typical mortgage rate, but the loans of this decade were driven by teaser rates, not by appropriate pricing.
Blaming subprimes for the mortgage crisis is like blaming teen drivers for a failed insurance company. Used appropriately, subprime loans can round out a balanced loan portfolio, but the pricing needs to be appropriate and the collateral must be be sufficient. A portfolio with inadequate collateral is flawed, regardless of the quality of the borrowers.
Barney Frank was clearly wrong about the bubble, but so was a majority of the population, including many of those in the real estate and lending industries with years of experiences and advanced degrees. Personally, I was among those who saw a bubble coming, but I was clearly in a minority and not a minority to whom many wanted to listen. Frank was in good company, for most of the “smart money” was in his camp, not mine…until they weren’t. Criticizing him or anyone other pol who bought into the story really is a cheap shot.
MBA,
That’s just not factually true. If the US housing market hadn’t been built on buyers that couldn’t really afford the houses they were buying then there would have been no products upon which to build leverage. The credit risk wouldn’t have been there. This was the WHOLE problem. The leverage was only implemented because it was falsely assumed that these people could all pay. You’ve got the causation backwards. Sure, the leverage made the crisis far worse, but the crisis never occurs if millions of people don’t buy houses they can’t afford.
Excusing Frank’s actions just because he was “in good company” is like excusing a negligent brain surgeon just because most people don’t know how to perform a brain surgery. Frank is in a very unique position of financial power. I don’t expect him to see EVERY crisis or understand every potential time bomb, but he TOTALLY missed it. He didn’t even acknowledge the possibility of a bubble. He was totally clueless.
Again, do any of you have FACTS showing that Barney Frank is qualified to serve as Chairman of the House Financial Services Committee or are you just blindly defending him because he is a fellow Dem? You and Gregg are really allowing politics to cloud your sound judgment.
Can someone please tell me specifically what the House Financial services committee did that precipitated this?
I’ll admit I’m not really familiar with this — regarding subprime what exactly did govt legislation do to encourage banks to make loans with insufficient collateral?
thanks, bringing CRE into the discussion (where the govt had no role I guess) clarifies things.
“Barney Frank was clearly wrong about the bubble, but so was a majority of the population, including many of those in the real estate and lending industries with years of experiences and advanced degrees.”
With all due respect the real “smart money” could not care less about Barney Frank and they where not buying they where selling and are now in cash.
As for the real estate and lending industries with years of experiences and advanced degrees. I think that now they do have the experience and will not realy need the advanced degrees after all.
Lower interest rate as risk increased every month would never have hapened in a real free market. This was an accident waiting to happen.
The same is appening now with Government debt. The rates do not reflect the risk. This alows for astronomic borrowings.
Good Luck
If the US housing market hadn’t been built on buyers that couldn’t really afford the houses they were buying then there would have been no products upon which to build leverage. The credit risk wouldn’t have been there. This was the WHOLE problem.
For one, that was not unique to subprime. The proliferation of aggressive loan products, i.e. interest-only loans, Option ARM’s, negative am loans and the like — to primes and to everyone else — was the issue.
And even that isn’t the entire problem. The underlying issue was a flood of equity into the debt markets, which supported such lending practices. Had there not been investors to overpay for the debt, then there would have been little problem.
Excusing Frank’s actions just because he was “in good company” is like excusing a negligent brain surgeon just because most people don’t know how to perform a brain surgery
Not a good metaphor. In this scenario, Frank is the guy who stocks the hospital vending machines, not the surgeon or medical staff. The medical personnel — those who get paid to put deals together — are the ones who committed malpractice.
Again, do any of you have FACTS showing that Barney Frank is qualified to serve as Chairman of the House Financial Services Committee or are you just blindly defending him because he is a fellow Dem?
You miss the point. (Speaking or which, I’m not a Dem, by the way.)
It’s quite simple — I don’t expect Barney Frank, Ron Paul or any other politician, of any party, to truly understand finance. (Fortunately for me, they rarely fail to meet my low expectations.) And the last thing that I would ever do is to seek out any politician’s guidance on macroeconomic issues or market analysis. None of them know much about it.
Meanwhile, there were numerous professionals who, unlike the pols, arguably should have known better. Yet it’s obvious that they didn’t know, either. As it turns out, the smartest guys in the room weren’t all that smart — there were many cogent explanations detailing why things were “different this time” and that there was no bubble.
I wouldn’t hold any Congressmen to a higher standard than I would those who devoted their careers to allegedly knowing such things. The professionals failed; Frank was merely parroting them. It isn’t his or any other politician’s job to master to market, but merely to develop the right blend of regulation and latitude so that he doesn’t have to.
People were sold houses they couldn’t afford. It doesn’t matter how you label them or what product was used. Frank had no qualms about what was going on in the housing market when all of these people were buying homes they couldn’t afford.
Your claim that the Chairman of the House Finance Committee should not be expected to be an expert in finance is nothing short of ridiculous. I guess we just have different standards. I expect my politicians to understand the things they pass laws about….
People were sold houses they couldn’t afford. It doesn’t matter how you label them or what product was used.
It does matter when 85% of the loans being originated weren’t subprime. Even your own posts here note that the default rate of primes is currently around 10%, not a small figure by any historical measure.
The subprimes failed first because they were, by definition, the most vulnerable. However, they were merely a symptom of the underlying problem of excess leverage, which had become common to prime and non-prime lending. Focusing on subprimes is akin to blaming influenza on the elderly because they tend to die first.
Your claim that the Chairman of the House Finance Committee should not be expected to be an expert in finance is nothing short of ridiculous.\
Most members of Congress are lawyers. For the most part, they have no professional background that they bring into the committees and subcommittees on which they serve. It’s not as if the Agriculture committee is run by farmers or the Small Business committee is managed by entrepreneurs.
In any case, as I have noted, direct professional expertise did not prevent the majority of working professionals from missing the bubble in real time. If those who do it for a living completely missed it, why would you expect congressmen whose alleged expertise comes from industry lobbyists to have done any better? The job of the legislature is to pass laws, not to dispense investment advice.
This whole argument is ridiculous. You’re defending the man when he is caught in a bold faced lie. I don’t even know how you can stand to waste the time writing anything in defense of him….
TPC,
Re: “You and Gregg are really allowing politics to cloud your sound judgment.”
Incorrect. I am a registered Republican. You can look it up. My position is not partisan in intent.
I’ve stated my OPINION. Clearly, it differs from yours. With regard to your other comments, I made it clear I was not defending BF’s recent comments. If you consider BF’s question to Bernanke, which was clearly a rhetorical question asked to get the obvious answer, was actually asked because he didn’t know the answer then I believe you need to rethink that.
I look forward to your market commentary and will try to refrain from posting any more comments. Thanks for your efforts. You DO have a great site here.
Gregg,
I value your comments. Don’t hesitate to comment. We disagree. Big deal. I am wrong a lot so I don’t pretend to be an expert in everything….
Best,
TPC
You’re defending the man when he is caught in a bold faced lie.
I’m not defending him. Rather, I am accepting him for what it is — a politician — and I am giving his investment prognostications the degree of attention that they deserve — none.
I understand that Frank is not a market guru. When it comes to analyzing markets, you can bet that I’m not going to run to him for his opinion.
But what you have not done on this thread is to create a linkage between Frank et. al. and the creation of the housing bubble. Frank et. al. did not **cause** the housing bubble. The bubble was caused by the free market behaving like a free market, behavior that leads to occasional cyclical meltdowns. They happened before Barney Frank, and will happen again long after he’s gone.
Although the legislature can be faulted for not having sufficient regulation, that does not mean that they created the bubble. They failed to stop it, but they did not create the bubble themselves. To understand the bubble, you have to follow the money, and realize that it could have never happened without aggressive lending coupled with abundant equity with which to fund the creation of new debt. Barring a complete rejection of supply-side economics and the deregulation mantra of the last thirty years in favor of more measured policies, the bubble would have happened, regardless of who was president or in Congress.
No one blamed Frank alone for the housing crisis. I called him out for a blatant lie and questioned whether he knows enough to be Chairman…Now you’re just twisting words because you’re caught on the wrong side of a very bad argument….
Now you’re just twisting words because you’re caught on the wrong side of a very bad argument
Forgive me, but I haven’t twisted anything.
On the other hand, it is a more than a bit sensationalist to act as if Frank’s claims about the market were meaningful. He didn’t move the market, nor was he acting as an investment adviser, so his views are irrelevant.
Focusing on the rhetoric of politicians is an unnecessary distraction. It doesn’t add any market insight, nor does it help anyone to trade the market. Suffice it to say that politicians are reactionary with respect to markets, and it’s best not to seek out their counsel when making investment decisions.
I called him out for a blatant lie and questioned whether he knows enough to be Chairman
As I pointed out, politicians routinely spin, and the Congress is packed with lawyers who have little to no expertise to support their committee positions. Expertise has little to do with it.
In any case, the experts were blowing it, anyway. You seriously expect professional politicians to understand markets better than the business professionals who made the very same inaccurate calls?
Honestly, I have no idea what you’re even arguing in favor of.
I have no idea what you’re even arguing in favor of.
My point is that your insistence on linking Frank’s comments to the current state of the economy (“And we wonder why the economy is so screwed up?”) is flawed.
It doesn’t matter what Frank said or didn’t say about the housing market. It would have ended up exactly as it did, with or without him. Frank et. al. didn’t cause the housing bubble, yet you are implying that they did.
That’s utter nonsense:
“When Fannie and Freddie were finally taken over by the government in 2008, more than 10 million subprime and other weak loans were either on their books or were in mortgage-backed securities they had guaranteed. An additional 4.5 million were guaranteed by the FHA and sold through Ginnie Mae before 2008, and a further 2.5 million loans were made under the rubric of the Community Reinvestment Act (CRA), which required insured banks to provide mortgage credit to home buyers who were at or below 80% of median income. Thus, almost two-thirds of all the bad mortgages in our financial system, many of which are now defaulting at unprecedented rates, were bought by government agencies or required by government regulations.”
“Fannie and Freddie were subject to “affordable housing” regulations, issued by the Department of Housing and Urban Development (HUD), which required them to buy mortgages made to home buyers who were at or below the median income. This quota began at 30% of all purchases in the early 1990s, and was gradually ratcheted up until it called for 55% of all mortgage purchases to be “affordable” in 2007, including 25% that had to be made to low-income home buyers.”
This is why conventional media is dead on the vine. Clear and logical information from blogs like this will help us through this open sewer of untreated information called the Internet.
Barney Frank is a liar and an idiot. Anyone defending him is just showing their ignorance. As “in bank” said………
“I’ve said it before but back in the late 90s, Barney Frank repeatedly exploited the notion that denying non-conforming borrowers access to credit for home purchases was a direct attempt by the Republican party at instituting a racist agenda. He successfully helped engineer and pass legislation REQUIRING Fannie/Freddie to INCREASE their subprime holdings – all the while collecting MILLIONS of campaign donations from these companies. Now these two companies represent one of the largest liabilities on the books of the Federal Government and are ONCE AGAIN asking for help”
Look it up…….