Upset By Elizabeth Warren, U.S. Banks Debate Halting Some Campaign Donations

The Obama admin defended the bill. What a shock! Next thing you know criminals will be claiming innocence. All you need to know about their comment is the fact that he addresses liquidity requirements and makes no mention of the increased regulatory and reporting requirements as a result of Dodd Frank. No surprise considering the closures because banks can no longer afford to make home loans http://www.forbes.com/sites/frankso...ank-bank-regulation-is-still-a-guessing-game/

Thousands of pages of complex regulations call for additional reporting requirements and hiring new talent, leading to increased costs that smaller financial institutions are less equipped to absorb. With banks focusing their efforts and resources on meeting regulatory requirements, innovations that would normally be focused on the consumer may have to take a back seat.

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Stringent mortgage lending rules have impacted banks’ willingness and ability to issue new mortgages. According to the American Bankers Association 2014 Real Estate Lending Survey Report, 38 percent of banks stated that new Dodd-Frank mortgage regulations caused them to reconsider their commitments to mortgage lending and about two-thirds of respondents will be restricting lending to Qualified Mortgages, or to QM loans plus non-QM loans that are restricted to targeted markets or products.

And Warren herself, another fine source. http://www.americanbanker.com/bankt...-the-future-of-community-banks-1072914-1.html


"First, there are now 1,342 fewer community banks in the U.S. than there were in June 2010. The number of banks with assets below $100 million shrunk by 32%, while the number of banks with assets between $100 million and $1 billion fell by 11%.

Consequently, it should come as little surprise that since Dodd-Frank, the share of U.S. assets held by banks with assets above the $10 billion threshold has increased by 4%. By contrast, banks with assets below $100 million have seen their share of U.S. assets decline by 40%. Banks with assets between $100 million and $1 billion lost 21% market share during this time.

The decline in bank lending, combined with low interest rates and a fairly stable economy, has meant that banks do not need to set aside as much money to cover future loan losses as they have historically. As a result, the loan-loss provision rate hit an all-time low in the past two years. To be precise, the provision expense for past year was 0.2% of assets, compared to a 31-year average three times that rate. In other words, this is as good as it gets.

One of the most important measures of bank profitability is the efficiency ratio. This calculation determines how much expense is needed for a bank to create $1.00 in revenue. The best-performing banks in the country shoot for an efficiency ratio of 0.5, which is to say that the bank spends 50 cents to create a dollar of revenue. In the 26 years before Dodd-Frank, banks with assets less than $100 million spent 71.2 cents to create a dollar of revenue while banks with assets between $100 million and $1 billion spent 67.9 cents. After Dodd-Frank, the smallest banks are now spending 78.2 cents; the next group is spending 70.8 cents. These are increases of 10% and 4%, respectively."

 

That's because you have been caught with your pants down trying to weasel out of the truth. A common (*)(*)(*)(*)(*) can see this thread is and was never intended to be about Dodd/Frank. Let me give you an example of how ridiculous your explanation is. Lets use a simple example. If I started a thread about "I am going to New York City for vacation" and talked about all the sites I wanted to see, that is what the subject of my thread is about; "Going to New York City for Vacation". If I mentioned I might drive there, that has nothing to do with the actual vacation of being in New York City itself. Driving a car to get there, has nothing to do with the sites I would see in New York City. The Elizabeth Warren thread is about the banks being mad at Warren and threatening not to give donations, because of Warrens activities. The Banks threatening to halt donations because of what Warren was doing has nothing to do with her feelings about using Dodd Frank. You telling me "that" is the other topic of the thread, we'll, no it isn't. The topic of the thread reads like this; Upset by Elizabeth Warren, U.S. banks debate halting some campaign contributions". Nothing in the title says anything about Dodd/Frank. So yeah, you are right, this one is toast. Except you are the one who popped out of the toaster with your own bs. So do us all a favor and "report" at will. Because it is clear you haven't a clue what a thread topic looks like or how to read it.

 

They distributed because the government incented them to. When Bill Clinton started pushing home ownership for lower income families and started allowing no down mortgages, no job verification and other risky mortgages to go through the GSE's banks felt they were not prudent to hold on their own books and sold them. Then they discovered how profitable that model was and they doubled down and helped fuel the bubble. Securitizing and packaging mortgages was not new. Doing it with high risk mortgages that was new. Which is why there was no commercial bubble because they maintained underwriting standard without the government incenting them otherwise.

 

AGAIN:


Most regulators define small banks as having $10 billion in assets, among other criteria. The definition allows those banks to be exempt from certain Dodd-Frank regulations.


http://thehill.com/policy/finance/b...37-warren-community-banks-thriving-under-dodd

I GET IT, YOU LIKE CATO, AMERICAN BANKERS ASSOCIATION, ETC talking points BS. I'm not surprised

 

MORE Right wing garbage. I'm shocked, no really I am

WORLD WIDE CREDIT BUBBLE AND BUST? LOL

Q When did the Bush Mortgage Bubble start?

A The general timeframe is it started late 2004.

From Bush's President's Working Group on Financial Markets March 2008

"The Presidents Working Group’s March policy statement acknowledged that turmoil in financial markets clearly was triggered by a dramatic weakening of underwriting standards for U.S. subprime mortgages, beginning in late 2004 and extending into 2007."




Q Did the Community Reinvestment Act under Carter/Clinton caused it?


A "Since 1995 there has been essentially no change in the basic CRA rules or enforcement process that can be reasonably linked to the subprime lending activity. This fact weakens the link between the CRA and the current crisis since the crisis is rooted in poor performance of mortgage loans made between 2004 and 2007. "





"Another form of easing facilitated the rapid rise of mortgages that didn't require borrowers to fully document their incomes. In 2006, these low- or no-doc loans comprised 81 percent of near-prime, 55 percent of jumbo, 50 percent of subprime and 36 percent of prime securitized mortgages."

https://www.dallasfed.org/assets/documents/research/eclett/2007/el0711.pdf



Q HOLY JESUS! DID YOU JUST PROVE THAT OVER 50 % OF ALL MORTGAGES IN 2006 DIDN’T REQUIRE BORROWERS TO DOCUMENT THEIR INCOME?!?!?!?

A Yes.




Q WHO THE HELL LOANS HUNDREDS OF THOUSANDS OF DOLLARS TO PEOPLE WITHOUT CHECKING THEIR INCOMES?!?!?

A Banks.

Q WHY??!?!!!?!

A Two reasons, greed and Bush's regulators let them




Bush's documented policies and statements in timeframe leading up to the start of the Bush Mortgage Bubble include (but not limited to)

Wanting 5.5 million more minority homeowners
Tells congress there is nothing wrong with GSEs
Pledging to use federal policy to increase home ownership
Routinely taking credit for the housing market
Forcing GSEs to buy more low income home loans by raising their Housing Goals (2004)
Lowering Investment bank's capital requirements, Net Capital rule (2004)
Reversing the Clinton rule that restricted GSEs purchases of subprime loans (2004)
Lowering down payment requirements to 0% (2004)
Forcing GSEs to spend an additional $440 billion in the secondary markets (2003)
Giving away 40,000 free down payments (2004)
PREEMPTING ALL STATE LAWS AGAINST PREDATORY LENDING (2003)


But the biggest policy was regulators not enforcing lending standards.


MORE FACTS HERE:

http://www.politicalforum.com/political-opinions-beliefs/394878-facts-dubyas-great-recession.html

 

The same exact thing happened at the exact same time in the sub prime auto finance business. And it was done by the same exact people. Difference is that there are buybacks in auto finance ABSs much stricter than in the mortgage industry.

The big players all went down. HSBC lost billions and went out of the business. Americredit all but went bankrupt and only survived with a buyout. Cap One went through the basement and was only kept alive because of their credit card profits. Dozens of others, some backed by huge corps, went under.

Needless to say, there was no CRA for auto finance, and there was no government car ownership policies for them to blame.

All by themselves, the investment banks created systemic risk, and that risk ruined them in the auto finance market.

Sadly, the same thing did not happen in the mortgage market.


You don't need a model to know that loans that ignore DTI and LTV are more risky than loans that do not ignore DTI and LTV. The "trick" of the financial crisis was getting AAA ratings for MBSs that ignored DTI and LTV. Investment banks did that by mixing up a bunch of loans and paying off the rating companies.

I have been looking for almost a decade now for government policies that forced the banks to do so, but strangely enough I have not been able to find any.

 

I am no Elizabeth Warren fan, but I have to give her credit. She is against Crony Capitalism. If it were between her and Jeb Bush, I would seriously be pressed. I may just go Libertarian... as usual, but Jeb, Hillary, establishment hacks... they are destroying this nation.

 

How many times are you going to bombard them with the same argument they have no defense for? Lol! You've linked them to death, and they are powerless to counter any of it, because it is spot on. I mean this is how the financial crisis went down, and they won't admit it. The good thing about it is, they don't have to. Most folks have the good sense already to know how it all happened. The Right pretends it was caused by some left-wing CRA years ago, and that's the only thing they can come up with, while that counter argument borders on embarrassing. They try and play up the copy and paste too, as another one of their excuses for an argument. Not only can they not counter your links, they can't make a good argument with explanations, because for every explanation they have, a link can always destroy that explanation. And it does just that. Kudos to you as usual. The problem you will always have is, the flat earthers will never see forest and tree in the same place, no matter how much truth serum you feed them.

 

And AGAIN, they are exempt from SOME regulations not all. Maybe reading that fact a second time helps it sink in. Democrats, the few that read and comprehend, repetition is par for the course. American Bankers Association is a trade association. Talking points are the Warren and Obama admin quotes you provided. But you're a demorat, the need to have information spoon fed like a mama handing out Gerbers comes with the elephant. Harvard study shows negative impact Dodd Frank has had on small banks http://www.hks.harvard.edu/centers/mrcbg/publications/awp/awp37

"Even more striking is that, as Figures 13 and 14 show, community bank consolidation trends have almost doubled since the passage of Dodd-Frank, relative to the Q2 2006 and Q2 2010 time frame, which includes the crisis period. Yet, as community banks’ share of U.S. banking assets declined substantially between Q2 2006 and Q2 2010, Figure 14 reveals that the five biggest institutions’ share of banking assets skyrocketed 18.4 percent during this period at the expense of other large banks, some of which failed in the crisis. Interestingly, community banks’ vitality has been challenged more in the years after Dodd-Frank than in the years during the crisis. In addition, regulation – as opposed to market forces – appears to be an increasingly powerful force driving the growth of bank mergers."

Of course this information wasn't repeated ad nauseum by some left wing website so I'm sure the pain will be palpable.

 

That's hilarious. Either you failed to read or failed to comprehend your own link. And I quote "Subprime loan problems had surfaced just before and at the start of the 2001 recession."

This article from 1999 (for the left wing impaired Clinton was in office) http://articles.latimes.com/1999/may/31/news/mn-42807

"Fannie Mae has agreed to buy more loans with very low down payments--or with mortgage payments that represent an unusually high percentage of a buyer's income. That's made banks willing to lend to lower-income families they once might have rejected."

 

You make this stuff up as you go along? No the same thing did not happen. Subprime auto loans expanded a good 3 years after the 2008 crisis. AmeriCredit made money on subprime in 08 and only struggled because the securitization market dried up and originations crashed as a result. Capital One is still one of the largest as is Santander after buying HSBC's portfolio and GM which bought AmeriCredit.

 

What is this drivel?

Typical HuffingPaint garbage, is what it is. Listen to this:

What kind of morons does HuffingGlue think we are? Any third grader can go to OpenSecrets.org and see exactly how many donations are coming out of the banks, and it ain't 15 thousand bucks.

Why do you waste our time with this idiotic propaganda? Wall Street isn't scared of Elizabeth Warren, that's just a meme invented by the Democrats for bleeding-heart sympathy votes. Who cares if there's one CEO or twenty? Believe me, Wall Street would rather have twenty! More people making more money, means more arbitrage opportunities, and it also means more opportunities to skirt the law which would make life a whole lot easier for our prime financial weasels.