Did Sen. Schumer cause Bank Panic/Failure?

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An interesting angle on the IndyMac bank failure, Senator Schumer may have caused the run on the bank!

 

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I think it was intentional, to give him something to use for his agenda.

Can you think of a better way to crash a Bank? than have a government offical leak a letter expressed concerns about IndyMac’s viability?

 

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Intentional or not, how many banks could survive a panic like that set off by Schumer's letter? No bank has enough capital to survive if a significant number of it's clients decide to withdrawl their money. Schumer's letter was like shouting fire in a crowded theature.

 

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A theater in which there is, in fact, a fire.

 

Senator Schumer is an idiot. Tell us something we don't know. I can't wait until his ass is voted out.

 

Actually the bad loans that many banks made without concern as to how they were going to be repaid created the problem to begin with. Anyone who discusses this isn't the ones who created that problem, the REGULATORY agencies that are supposed to keep a watch out for that activity are the ones really to blame as well for not stopping the spread of this nightmare before it became this mess we have now.

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Let's be fair: they were not only saddled with political supervision, bureaucratically dangerous interference, and incompetent management, from the executive branch, but they had been deprived of regulations to enforce.

Largely thanks to a guy who is McCain's longtime chief economic adviser Phil Gramm, who rewarded his wife's old employer and major source of moolah Enron with a couple of banking and investment deregulation bills that essentially prevented anyone in the the Federal government who knew what they were looking at from curbing this trough race that Enron was, at the time, winning.

The best was the Commodity Futures Modernization Act of 2000. That's the one that (among other crass stupidities) dealt even overseas banks into the US bubble market, allowing entities like UBS of Switzerland (a bank) to buy US investment firms like Paine Webber that were handling all this fictionally collateralized debt, and thereby spread the consequences of US foolishness to Europe as well as expanding it at home.

UBS hired Gramm ( at a fancy salary) to help them take advantage of the Gramm bills, and ended up writing off losses equal to four years' profits, last year.

McCain had him slotted for Treasury Secretary, continuing the tradition of full employment for ex-associates of Enron in Republican administrations, until the recent flap.

 

No, more like a theature with a bunch of candles perched precariously all over the place. Maybe even some oil soaked rags on the floor for good measure. But no fire, not until the panic Mr Schumer set off.

Sure, the bank may have failed eventually anyway. It clearly wasn't in the best shape. But leaking information that results in a run on the bank is irresponsible and has just cost the taxpayers over four billion dollars!

 

Indy turned down Schumer for a mortgage loan?

Poor risk.

 

The Republicans are wrecking America, don't blame a Democratic congressman for stating the obvious.

 

What happened in 2006? The Democrats took over control of Congress, they are the ones who hold all the committee heads, and set the agenda, they write the bill's they pass the laws.

2 1/2 years the Democrats have been in control, so don't blame the Republicans alone, there is plenty of blame to go around, but when you get such blatant action as Chucky Shumers interference, it becomes obvious that the Democrats want America in Pain, because they and you believe that it will rebound to their political benefit.

Here is where it all started, under Jimmy, the Peanut, Carter, a Democrat, and the 95th Congress (1977-1979). Majority Party: Democrat (61 seats) .... changing control of the Senate from the Republicans back to the Democrats, and the House stands at 258 Democrats, 175 Republicans and one independent.

The law required banks to make home loans to people who were marginal credit risque.

Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.) is a United States federal law that requires banks and thrifts to offer credit throughout their entire market area and prohibits them from targeting only wealthier neighborhoods with their services, a practice known as "redlining." The purpose of the CRA is to provide credit, including home ownership opportunities to undeserved populations and commercial loans to small businesses.

 

Senator Schumer (Communist-NY) hates America. He should be tried for treason.

 

How do you fix federally regulated failure with more federal regulation? IMO, this is clearly a case against big government intervention.

 

That's the great thing about government regulation. No matter what the problem, no matter how poor the track record the government has-if something goes wrong, the solution is more government control. When the increased government control produces even worse results, the solution is still more government control. Until we're all basically slaves to the state, or the people decide they've had enough of this crap.

 

Republicans are still filibustering and being obstructionist. They want to make the Dems look ineffectual. Bush also vetos everything, so only a veto-proof majority can succeed, which depends on Republicans.

Making loans to poorer people isn't the problem. The problem is deregulation that allowed predatory lending to these people, making variable rate loans and questionable arrangements that were risky, as well as the secondary problem of selling and trading these loans on the market.

 

The problem is Republican de-regulation, not excessive regulation. We knew the importance of this since the Republican Great Depression.

 

The problem had little to do with either political party and primarily to do with the Federal Reserve which flooded our money supply, creating easy credit and a credit driven boom which was destined to crash. Upon crashing, government intervention from the Fed in attempts to help the economy only made the problem worse.

That's what happened in the early 20th century, and we're seeing the same exact thing happening now.

 

ding,ding,ding,ding......We have a winner!

It's bigger than the parties. They just make gains by pointing fingers at eachother.

 

And that deregulation was by the Democrats, actually I would call it re-regulation.

The problem is making loans to people who can't afford to pay them back, the poor are not capable of paying back loans.

The Democrats decided that banks had to make loans to people (the poor)who didn't qualify, so they wouldn't be discriminated against, equal opportunity and all that, well equal opportunity also means that when you can't pay you are foreclosed on.

The big secret is don't buy what you can't afford.