Quote Originally Posted by japangreg
No, actually - and I'd like to see which regs you are referring to in the CRA expansions. I'm planning on looking them up a little later, but if you have the info handy I'd appreciate a link.
I've posted a number of articles already that go into specifics. The CRA expansion was probably the most significant action. But, the goal of making loans accessible to low-income people was pursued in many other ways that have also been touched on in links I've already posted.

Quote Originally Posted by japangreg
I don't think you quite understand the nature of the problem: accessability to loans for risky borrowers was only the beginning of the problem. The recombination, resale and mixing of complex financial instrucments to hide the risky investments is what puts us where we are today. That's why it's spread so far and so deep. The SEC and others who were supposed to oversee the situation were both ill equiped to deal with it and actively encouraged to let the market do its thing. If the bad debt hadn't been hidden so well in order to make the biggest bucks in the quickest time, it couldn't have seeped so far into the economic system worldwide.
lol. Yes. Accessibility to loans for risky borrowers WAS the beginning of the problem. If it were fixed at the beginning, the shady dealings you refer to wouldn't have occurred.

What you are describing about regulators being ill-equipped is exactly what the Republicans were saying and the Democrats denying before the problem escalated to this point. Bush warned that the size of Fannie and Freddie exposed our economic system to trouble. Later, when the poop started coming to the surface, Republicans basically said that we shouldn't be finding out about this just now. They proposed regulation reform. Democrats opposed that and killed the bill.

Quote Originally Posted by japangreg
Then why did it die in a Republican dominated committee?
Having a Republican dominated committee doesn't mean that the minority party is without means of stopping a bill or prolonging negotiations. According to everything I have read, it was a partisan issue and the Democrats were holding the bill up. I have already posted a link that confirms that and offers a quote describing the reasons for the Democrats objection to the bill (which were all false reasons).

[Part of the reason it didn't pass may be because some Republicans were in on the deal with Fannie and Freddie. It may be that the Republicans for the bill were not confident that they had the votes due to a few of their own on the Democrats side of the issue.]