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September 20, 2008
NYT in 2003: President Bush Tried To Stop Advent Of Fannie Mae Fiasco
Topics: Political News and commentariesAccording to this New York Times article from September 11, 2003:
The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.And this was way back in 2003!Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.
The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.
The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac -- which together have issued more than $1.5 trillion in outstanding debt -- is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates.
It was stopped by Chris Dodd, the Democratic chairman of the Senate banking committee.
Related readings:
September 19, 2008: the day capitalism died (edit: I suggest it was murdered)
Are We Headed Toward A New Collectivist State?
Mythbusting
Posted by Richard at September 20, 2008 7:21 AM
Republican Richard Shelby was the chairman of the Senate banking committee from Jan 1, 2003 - Jan 1, 2007, when Chris Dodd took over. So explain to me again how the Democratic party is responsible for this?
Posted by: Eric at October 29, 2008 1:10 PM
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