(Paraphrasing the above NY Times article I posted) Fannie Mae, the nation’s biggest underwriter of home mortgages was under increasing pressure from the Clinton Administration to expand mortgage loan availability to moderate and low income Americans. (More risk) Additionally Fannie Mae felt increasing pressure to maintain its phenomenal growth in profits.
Peter Wallison, a resident fellow at the American Enterprise Institute forewarned us in this very same NY Times article a decade ago that, “If they fail the government will have to step up and bail them out just as they bailed out the thrift industry.”
Ann if one thing has become abundantly clear in the last several months it is that nobody in the Legislative Branch, Executive Branch, Wall Street or Main Street appears to have a “solution” at the present moment in history. But I’m sure most of us agree that we can learn from our past mistakes. Unfortunately it is too late to solve many of the injustices and miscalculations that have sadly already occurred.
However I can sum up Peter Wallison’s position and my own current opinion in two words, “less risk” in the future.
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