Comments about ‘Thomas Sowell: No one contributed more to housing bust than Barney Frank’

Yes, it is on TV, along with Waters, Meeks, Royce, Clay, Shay, Manzullo and Raines. Youtube those names and Fan Mae, Fred Mac and enjoy. So much for the watchdogs in the Congress. They were all asleep!

Even if you don't agree with Dr. Willaims, I find his insights interesting, thought provoking and I alway learn something. Thanks Dr. Williams.

Bye Bye Barney. (One can only hope)

I don't know if he is incompetent or corrupt. All I know is that the voters in his district will most likely send him back for another term.

If his actions don't open voter's eyes, almost nothing will. We often get the government we deserve.

The housing implosion is a classic example of what happens when government is given control over what should be private business.

To Barney's credit, he is now advocating privatization of Fannie and Freddie. I don't know if he's talking that way because his re-election is running close, but for whatever reason, he's suddenly making sense. We the taxpayers own those two businesses now; let's break them up and sell them off. We should not be on the hook anymore for their stupid decisions. Our tax money should not be used to prop up any business that so blatantly acts as cash cow for the campaigns of idiot Congressmen.

We've been told for all these years that Fannie and Freddie serve a valuable economic function. If so, then their remnants will survive just fine under private ownership.

Let's put an end this unholy alliance between business and government that in Mussolini's day would have been called fascism.

Barney Frank is an embarrassment.

The housing_loan_problem wasn't just caused by government encouraging and even forcing lenders to make bad loans. It was also caused by greedy lenders.

In the past home mortgages had been a pretty safe long-term investment for banks. But when they started getting government requirements to make special loans to people they probably wouldn't approve otherwise it changed. It also changed when some lenders got greedy and started making even more bad loans, knowing they probably wouldn't be paid back, but knowing they were just going to bundle them into a bucket of investments and sell them to other investors who didn't realise the risk anyway.


It was BOTH side's fault. The lenders who made knowingly bad loans AND the government who encouraged them to do it.

If private_enterprise were left alone they probably wouldn't have made many of these bad loans. Banker's out of self-preservation don't want to make risky loans. The old_fashioned way to get a risky loan was to charge high enough interest to make the risk of some defaults still worth the risk. But recent government mandates put these natural-laws out of balance.

I hope Barney Frank has some skills he can use to find employment in the private sector.

Forgot who was pushing the lawmakers for this. The peverty advocates & home builders. While Barney Frank facilitated it, he couldnt have done it alone. Plenty of GOP & Dem lawmakers signed off on it.

Dr. Sowell is trying to provide a diversion and cover for all the republicans who are evidently still hiding in the “bush” and hoping we forget about the Iraq war. To blame Barney Frank in the face of the republican majority in both houses and the presidency for approximately six years is repulsive. I am sure what Barney Frank wants is what he gets. That’s why we went to war with Iraq because he opposed it and that’s why we have gun control because he is for it. Isn’t it interesting if a democrat agrees with the republicans on something all the non-adults in the room want to blame the democrat for a bad decision? Can we trust the republicans to assume responsibility for anything? How can you agree with this guy

Re: louie
ahh, I hate to be the one to bring you up to date,but Democrats have controlled both houses of congress since 2006. The housing bubble burst happened in 2009 and yes, Barney Frank was at the bottom of it all.

ref: Mountanman, Sorry but you are very wrong. Dems took control in congress in january '07. The federal government started talking about bailing out Freddie Mac and Fannie Mae in June of '08. Believe me things were getting pretty sour before the Dems took control, but you essential have admitted the republicans showed no leadership in dealing with the problem.

Republicans controlled Congress until Jan 2007.
When Frank made his comments Republicans were in control. Did Franks filubuster any measures? no. What measures did Republicans bring forward to be voted on between 2000-2007?

The bottom line is both parties to a greater or less extent had a role in the economic crisis. Anybody suggesting otherwise is not being honest.

Ah, Barney Frank is a perfect example for pursuing term limits.
We should not allow the powerful, often inept and dangerous, positioned congressman and women to push through questionable legislation, at the expense of prudent and responsible actions.
Term limits for congressman would not only save millions of dollars spent in re-election bids but also more importantly prevent anyone of the same from becoming a political strong-arm.

There was definitely pressure to provide home loans for some with unworthy credit. Barney Frank is tied to that.

But home ownership rates only went up by about 3% as a result of that. That was enough for things to go haywire, perhaps.

The point I want to make is that virtually no one - including law makers, home buyers, mortgage lenders, the Federal Reserve, and investors in mortgage-backed securities - understood the risks of the marketplace.

Yes, Barney Frank didn't know the risk of what he was doing, because he didn't understand the goings-ons in the credit markets, just as those in that very market didn't understand.

So Mr. Frank, et al., should get plenty of blame. But in the context of Sowell's commentary, Frank is more of a scapegoat.

silas,

You've just made a very solid case against government intervention in private markets. No person, or group of people, has enough understanding of the market to know what the effects of their manipulations will be. At the same time, one stupid man wielding government power can do massive amounts of harm.

I have little use for Mr. Frank. And it is clear that stronger controls on Fannie and Freddie were warranted.

But blaming this crisis on govt. (either party) is simply incorrect. No lenders were forced to make bad loans. They did that all on their own and for a simple reason — profits.

The market had become so segmented that the origination end was almost entirely divorced from the owning/servicing end (witness the problems now being experienced as they try to foreclose).

If you are paid to originate and have zero skin in the game (no repercussions for you if the loan goes bad) then you just keep originating away.

That combined with the fact that the quants at the major Wall Street firms had (they said) found the secret to effectively containing risk, made this a casino economy — but with most participants not realizing that it was gambling rather than investing.

The primary problem was not the under regulation of the “seen” entities like Fannie and Freddie (though there was certainly a problem there) but the near total lack of regulation (or even effective understanding) of the “shadow banks” that provided all of the capital to the mortgage industry.

RE: Twin Lights | 9:24 p.m.


Please explain how banks make a profit on bad loans.


They don't,

and it is simply bad business to give out bad loans.


The Fact is government forced them to "loosen" the requirements for qualifying for a loan,

which lead to a mortgage crisis.


LIBERAL Government trying to help people own a home ended up having unintended consequences,

just like everything LIBERALS and Progressives touch.

The truth
Thanks, You are correct, sir. (or mam)
The liberals desire for some government backed utopian society is the cause of most of whats wrong with our country. If we could just get them to stop the meddling, and mind their own business. We will have an opportunity to vote many of them into retirement. But Barney boy will not be one of them. The people in Mass. are clueless.

Those poor souls who believe that banks were lining up out of greed to sell mortgages to people with poor repayment histories have a poor comprehension of how the financial industries operate.

Ah, but they heard Barney Frank say it was the greedy banks' fault, so it must be true.

This is an illustration of "cognitive dissonance;" they don't want to believe the truth, so they believe anything else, no matter how improbable.