Federal Housing Enterprise Regulatory Reform Act 2005/2007

Astronuc

Considering that the US economy was just about brought to its knees, what the heck happened?

Warnings about Fannie Mae and Freddie Mac go back to the late 90's!


On Jan 26, 2005, Chuck Hagel introduced a bill 'Federal Housing Enterprise Regulatory Reform Act of 2005' with cosponsors John Sununu and Elizabeth Dole. John McCain signed on as cosponsor May 25, 2006.

The bill apparently stalled/died along the way. It was resurrected as S. 1100, Housing Enterprise Regulatory Reform Act of 2005', on April 12 2007.

Perhas (??) this legislation was incorporated into H.R. 3221: Housing and Economic Recovery Act of 2008, which was passed by House and Senate, and signed into law by President Bush on Jul 30, 2008. A bit too late!

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Background:

S. 190 [109th]: Federal Housing Enterprise Regulatory Reform Act ...
Text - http://www.govtrack.us/congress/bill...?bill=s109-190
Bill status page - http://www.govtrack.us/congress/bill.xpd?bill=s109-190


BANKING, HOUSING, AND URBAN AFFAIRS

Room SD-534. Dirksen Office Building. Meetings, last Tuesday of each
month at 10:30 a.m.
Richard C. Shelby, of Alabama, Chairman
Robert F. Bennett, of Utah
Wayne Allard, of Colorado
Michael B. Enzi, of Wyoming
Chuck Hagel, of Nebraska
Rick Santorum, of Pennsylvania
Jim Bunning, of Kentucky
Mike Crapo, of Idaho
John E. Sununu, of New Hampshire
Elizabeth Dole, of North Carolina
Mel Martinez, of Florida

__________

Paul S. Sarbanes, of Maryland
Christopher J. Dodd, of Connecticut
Tim Johnson, of South Dakota
Jack Reed, of Rhode Island
Charles E. Schumer, of New York
Evan Bayh, of Indiana
Thomas R. Carper, of Delaware
Debbie Stabenow, of Michigan
Robert Menendez, of New Jersey

Ref: http://www.gpoaccess.gov/calendars/d...06/sc31ja.html
( http://www.gpoaccess.gov/calendars/s...browse_sc.html ,
http://www.gpoaccess.gov/calendars/senate/browse.html )


Reintroduced (April 12, 2007)
http://www.govtrack.us/congress/bill...bill=s110-1100
Bill status page - http://www.govtrack.us/congress/bill.xpd?bill=s110-1100

Last Action: Apr 12, 2007: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.


BANKING, HOUSING, AND URBAN AFFAIRS

Room SD-534. Dirksen Office Building. Meetings, last Tuesday of each
month at 10:30 a.m.
Christopher J. Dodd, of Connecticut, Chairman
Tim Johnson, of South Dakota
Jack Reed, of Rhode Island
Charles E. Schumer, of New York
Evan Bayh, of Indiana
Thomas R. Carper, of Delaware
Robert Menendez, of New Jersey
Daniel K. Akaka, of Hawaii
Sherrod Brown, of Ohio
Robert P. Casey, Jr., of Pennsylvania
Jon Tester, of Montana

__________

Richard C. Shelby, of Alabama
Robert F. Bennett, of Utah
Wayne Allard, of Colorado
Michael B. Enzi, of Wyoming
Chuck Hagel, of Nebraska
Jim Bunning, of Kentucky
Mike Crapo, of Idaho
John E. Sununu, of New Hampshire
Elizabeth Dole, of North Carolina
Mel Martinez, of Florida

Ref: http://www.gpoaccess.gov/calendars/d...07/sc11jy.html


http://en.wikipedia.org/wiki/Office_...rise_Oversight
http://www.govtrack.us/congress/bill.xpd?bill=h110-3221

This is another thing that surpises me:
H.R. 6521: Federal Housing Finance Regulatory Reform Act of 2008
http://www.govtrack.us/congress/bill.xpd?bill=h110-6521

WhoWee

Anytime that much legislation is drafted...everyone realizes there is a problem (mostly because they helped create/sustain the problem) and nobody knows how to fix the problem.

I wonder how many jobs were created in this process?

Ivan Seeking

Keep in mind that the real culprits were the credit default swaps, not Fannie and Freddie. Deregulation of the derivatives markets was the primary cause of the global financial disaster.

WhoWee

Let's give credit where credit is due...let's not forget the Community Reinvestment Act
http://www.policylink.org/EDTK/CRA/

Congress learned nothing from the S&L crisis.

Credit Default Swaps were just another page in the long story of banks/S&L's/mortgage companies and Wall Street finding creative ways to re-package loans ...but this time the underlying loans were much riskier.

The second factor was speculation...when price doesn't matter AND the deal can be funded with less than 5% down...prices will rise artificially. If the banks would have made just 1 adjustment...a requirement that "investors" must own the land (pay cash)...and lend only on improvements...at cost, speculation would have been curtailed.

If the loans were good, there wouldn't be a problem.

If you want to investigate, start with the people who required loans be made, then the people who wrote the bad loans...(undocumented income and low credit scores for starters)...then flipped the risky loans to investors.

There is a lot of blame to go around.

russ_watters

No, they were at least equally responsible. Remember, those credit default swaps were only a bad investment because of what they were invested in: bad mortgages. If they weren't invested in bad mortgages, they wouldn't have crashed.

It gets more complicated from there, though, with absurdly low interest rates as bad Fed policy, an overblown housing market that hadn't yet crashed like everything else after the '90s economic boom, etc.

mheslep

Take away Credit Default Swaps 10 years ago, and this crisis still happens in some form. Take away Fannie and Freddie 10 years ago, and the housing legislation that went with them and this crisis never happens.

Fannie and Fred are also still far away the largest single sink hole for federal bailout money ($200B each).

WhoWee

I'd just like to to play Barney 1 more time

http://www.youtube.com/watch?v=u_1oPjsNOyY

Oscar Wilde

exactly correct