Freedom of BLEEP

On September 17, 2007 at NASDAQ, Mr. Obama said that “Subprime lending started off as a good idea.” He went on to claim the condition of the real-estate market could be pinned solely on the corruption of financial institutions.

But wait a second. Since when was subprime lending a good idea?

The very definition of subprime lending states that there is a heightened risk of default, meaning these borrowers have a history of loan delinquency or default, a recorded bankruptcy, or limited debt experience. Does it sound like “a good idea” to give these people mortgages?

So why did Obama say that subprime lending was a good idea? Because he himself pressured financial institutions to make these bad loans. While working with ACORN in 1994, Obama sued Citibank because they were NOT making risky loans to unqualified individuals.

That’s right. Obama and ACORN worked together forcing financial institutions to make extremely high-risk loans. During his presidential campaign he denied all ties to ACORN, but this clearly contradicts a published statement by Chicago ACORN Leader, Toni Foulkes:

“We have invited Obama to our leadership training sessions to run the session on power every year, and, as a result, many of our newly developing leaders got to know him before he ever ran for office. Thus it was natural for many of us to be active volunteers in his first campaign for State Senate [...]. By the time he ran for U.S. Senate, we were old friends.”

Obama provided legal training to ACORN workers so they could intimidate banks into granting risky loans to people with low income and bad credit. Check out this video to learn more about ACORN tactics.

So how did this all come about? How can the government force banks to make bad loans? This excerpt from a CNS News Analysis sums up the answer to that question:

According to Sheldon Richman, editor of The Freeman and an economist with the Foundation for Economic Education, government policy is to blame.

Under the Clinton administration, federal regulators began using the [Community Reinvestment Act] to combat ‘red-lining,’ a practice by which banks loaned money to some communities but not to others, based on economic status. “No loan is exempt, no bank is immune,” warned then-Attorney General Janet Reno. “For those who thumb their nose at us, I promise vigorous enforcement.”

The Clinton-Reno threat of ‘vigorous enforcement’ pushed banks to make the now infamous loans that many blame for the current meltdown, Richman said. “Banks, in order to not get in trouble with the regulators, had to make loans to people who shouldn’t have been getting mortgage loans.”

Stay tuned for more Obamanomics…

Tags: ACORN, Economy, mortgage crisis, Obama, Recession, subprime lending

This entry was posted on Monday, November 24th, 2008 at 8:38 pm and is filed under Economy, Obama, Recession. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.