Republicans believe in privatization of profits and socialization of losses.

And here is their new leader:

Here is a look at McCain’s back-and-forth on regulation during the last 24 hours:

- Deregulation: McCain issued a statement Monday morning saying that "we cannot tolerate a system that handicaps our markets and our banks."
- Regulation: McCain’s campaign then put out an ad calling for "tougher rules on Wall Street."
- Deregulation: This morning, on NBC’s Today Show, McCain said, "Of course, I don’t like excessive and unnecessary government regulation."
- Regulation: Then, on CBS’s The Early Show, McCain said, "Do I believe in excess government regulation? Yes."
- Both: On CNBC’s Squawk Box, McCain said, "We don’t want to burden average citizens with over-regulation and government bureaucracy...And I’m proud to be a Teddy Roosevelt Republican, who said, ‘unfettered capitalism leads to corruption,’ and we’ve got to fix this."

Never fear Starbucks will not fail. We need all that caffine, sugar etc to be able to work our two ot three jobs that we now have.

I thought Starbucks was getting rid of a lot of its restaurants? :--)
Seriously, these Republicans got us into this mess....Where was the President and his administration? Weren't they watching? they didn't see what was going on for EIGHT YEARS?
AND MC CAIN WILL BE THE SAME....
Obama/Biden 2008

last time they did this bail out for a trillion dollars they waited until after the election.

of course the names were a little different on the door ...

McCain/Keating has become Mccain/Gramm.

The GOP economic philosophy has finally come home to roost.

What a time for it to happen. There must surely be a God somewhere!

funny how the HOUSE republicans (thats the local yokel representatives mostly ,not really that rich by and large,comparitively speaking) are the ones making any sort of fuss over this.

the SENATE republicans' (they are the REAL FAT CATS) silence on these bailouts is most telling... i think some senate investigations may be in order when the democrats DO finally get enough majority to actually get something done.

1st order of business: bust republican corporate overlords/elitists DOWN TO SIZE!!

yeah thats gonna include you lady rothschild you turncoat.

It all just makes me want CHANGE!

Yes - Bear Stearns, Lehman and AIG are just like Starbucks.

Who elected this woman?

Never fear Starbucks will not fail. We need all that caffeine, sugar etc to be able to work our two or three jobs that we now have.

Posted by: jenny
--------
Amen to that! Guess I'm not the only one looking for a Saturday job. Trying to get kids through college, but can hardly make ends meet. Thanks but no thanks, Republicans!

cmon Paige, be logical and smart.

how can mccain do anything but lie and flip flop?

if he tried to use the republican parties' true political history of the last 40 years ,he would get no votes from anyone but the top 5% of the rich in america.

he has to go back and forth , any real concrete policy he DOES endorse becomes a real hot potato for him almost immediately due to the difference in what he says he thinks in order to appeal to the widest voter demographic versus what his rotten corrupt party base requires/expects him to preach.

"''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''

- September, 2003 - Barney Frank (D), ranking Democrat on the Financial Services Committee

Boy - with Democrats keeping Congress from exercising its oversight role over Fannie-Freddie during years of endless worth of bad loans for "low income housing for the poor/the children/the oppressed", no wonder Pelosi and Reid are leaving Washington in such a hurry.

""There is a sort of a panic going on," "The facts don't warrant that reaction in my view. Fannie Mae and Freddie Mac were never bottom feeders in the residential mortgage markets. People ought to feel confident about them."

Senator Christopher Dodd (D) 7/2/2008

The hits just keep coming. The former CEO ousted from Fannie - Franklin Raines - is one of Obama's top economic advisers. The nation is screwed if these dolts get anywhere near the WH.

Read the New York Times article from 9-11-03 entitled "New Agency Proposed to Oversee Freddie Mac and Fannie Mae"

The truth hurts (Democrats).

EPIC. FAIL.

There will be no investigations, as if there were, they might find that 5 years ago Bush tried to reform these industries, and McCain tried three years ago... efforts that were spiked by Democrats, since they were on the receiving end of loads of cash from these same companies. And since Obama was #2 on the cash cow list (Chris Dodd, getting preferential rates from Countrywide was #1), this will never see the light of day. But don't let silly little things like facts get in the way of your Obama worship.

Why would anyone listen to bat sh*t crazy Michelle Bachman? Seriously. The woman is insane. Man the Republicans bring the crazy women out of the wood-works.

Truth Matters,
I sure as hell don't. Bailouts are anathema to conservatism/free markets!

To all the Bush bashers, I'll await your detailed analysis of Bush's role in this crisis.
Also, explain away how relaxing credit rules to fit liberal ideals of homeownership at Freddie/Fannie helped us get to where we are.

Banking oversight is a function of CONGRESS.

If there is blame - it lies in Congress on the Banking Oversight Cmte.

Google the Chairman.

The buck literally stops with him.

its called "PERCEPTION ECONOMICS" Good Lt.

i think those comments like many i hear daily from diverse financial corners try to get the american public to be calm .

a perception of calm is just enough sometimes to actually make the entity take a turn for the better , or allow time for a correction ,by legislation or other means.

have you ever heard anyone say "this is perception based economy"? when you do ,ask them what them mean ,then perhaps you will understand some of the positive leaning/optimistic economic statments made by both parties.

bless your simple minded heart.

Banking oversight is a function of CONGRESS.

Banking oversight is a function of CONGRESS.

Banking oversight is a function of CONGRESS.

Needs to be repeated over and over.

Can't fix stupid.

Democrats = Epic. Fail. is right on!

It appears all our little libbie friends out there need a basic course in Economics 101, specifically Macroeconomics.

Keep spouting your empty talking points that you've been brainwashed with. The rest of the country is laughing at your idiocy.

Let's not forget the housing meltdown is at the heart of these failures.

I didn't hear any outrage from Americans when their retirement funds and home values were soaring because of a booming housing market fueled by people taking out loans they couldn't afford to repay.

I'm just sayin... There's plenty of blame to go around from Washington to Wall Street to Main Street.

And for the record, McCain warned of this in 2005 and tried to reform Fannie and Freddie, but the 2006 Congress voted him down.

and btw,one of your quotes was almost 6 years old... that the best you can come up with??

There is one bailout that would solve all of these problems - providing fixed-rate, 30-year mortgages to people who are facing foreclosure.

This would stabilize home prices and stabilize the markets.

But it would also be seen as socialist whereas bailing out AIG overnight is not.

Donald Trump endorsed mccain last night. If there was ever a guy that looks out for his own interest it's Trump so that's good enough reason for me not to vote for mccain. I guess Trump would fall in that group making over $250,000 so he's worried. Anyone making under $250,000/year will see a tax decrease under Obama. Obama/Biden 2008!!!

Yes and you can thank this Senator:

In 2002, McCain introduced a bill to deregulate the broadband Internet market, warning that "the potential for government interference with market forces is not limited to federal regulation." Three years earlier, McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign. The Gramm-Leach-Bliley Act aimed to make the country's financial institutions competitive by removing the Depression-era walls between banking, investment and insurance companies. (WashPO)

Barb previously wrote: "Seriously, these Republicans got us into this mess....Where was the President and his administration?"

While you no doubt get emotional satisfaction from your rant, at some point you will HAVE to address these cold hard facts:

1. CONGRESS is the branch of government charged with regulating banks and quasi public companies such as 'Fannie' and 'Freddie'

2. CONGRESS writes the laws and regulations creating these entities and (supposedly) for "regulating" them.

3. Unfortunately, Congress has drafted these laws in such a fashion so as to almost GUARANTEE fraud and abuse will be rampant, and failure inevitable. For example, how is it POSSIBLE to allow somebody to apply for a mortgage without having to disclose how much money they make? Under those circumstances, how on earth can Fannie Mae decide if the applicant is a good risk or not (i.e. more likely to pay than default?) FANIE MAE DIDN'T CARE IF THE BORROWER COULD PAY OR NOT - SINCE Fannie KNEW the government was committed to bail them out if everything went south.

4. Re-read items 1-3 above. Are you STILL SURPRISED everything went into the tank??????????

Not surprising that the do-nothing party wants to do nothing is it? They would rather demagogue.

so whats you point daverino? the congress has been (and still is by virtue of the lame duck veto) under republican majority rule for the last 8 years ,and many before that as well.

yeah its a problem that the republicans have failed to address ,mainly because they were GETTING RICH BECAUSE OF IT !!!

THEY ARE THE MAJOR STOCKHOLDERS YOU ARE BAILING OUT DAILY AND THEY ARE DECIDING YOU USE TAXPAYER DOLLARS TO PAD THEIR ALREADY GIGANTIC SECRET SWISS BANK ACCOUNTS.

go on , be stupid . elect another republican ,its nothing to me really.

gives me something to live for though ,cause i live for the day when the american voter has an iq score > a light bulb/room temperature...evidently though ,reading over these posts its apparent that hasnt happened quite yet..

McCain, a member of Congress, has long been a champion of less government regulation. In 1995, he supported an unsuccessful attempt to create a moratorium on all kinds of federal regulation. He maintained that excessive regulations were "destroying the American family, the American dream." He said voters "want these regulations stopped."

"I'm always for less regulation but I am aware of the view that there is a need for government oversight," he told the Wall Street Journal last March. He added, "but I am fundamentally a deregulator."

Who is the Chairman of the Senate Banking Committee? Who got the most Fannie/Freddie donations?

Answer to both: Dem Sen Chris Dodd.

Who proposed Fannie/Freddie reform back in 2005 (probably too little too late, but worth a try)? Sen. John McCain.

Which candidate understand the financial complexities of the current situation - neither.

Why is it that Republicans have nothing else to resort to in this situation but name calling and grasping for things that are largely irrelevant?

And Good Lt, you ought to be careful saying things like 'the truth hurts'. Someone is liable to point right back at you and say, yes, it does.

alwyr,

Remind me...what party was in charge of Congress 18 of the last 20 years? And what party held the presidency for the last 8 with veto power over any legislation proposed by Congress? And what party has as their centepiece de-requlation of business? Republicans do not want to take responsibility for any of the mess that they have created...and it is not just the economy..

Holdfast - Who has three Freddie Mac and Fannie Mae uber lobbyist working and advising in the inner circle of his campaign? JOHN MCCAIN.

How is he going to serve two masters?

We should be paying attention here, paying attention because thats all we may have to pay with. We should as citizens all demand that an outside agency, not one appointed by any member of Congress ,investigate this matter.
Hire an outside firm, outside the country if necessary ,lay the books out and go to it. All we have seen so far is a finger pointed and recess by our leaders called. Is this what we pay them for? Or do most of them have something to hide?

My god, I have never heard so much whining in my life! Oh wait, this is all coming from the left mainly. We are tired of hearing you complain about the government's inability to help you, that's what happens when you put your faith and dependence in the government. For once, can you spare us your entitlement garbage and stop your incessant pan handling for taxpayer money. Go out there and get it done, work for it! You bring shame to our parents and grandparents who built this country and faced much more daunting challenges than this!

i would much rather be known as the "do nothing" party than be known as the " confederate flag-waving, gun toting redneck, white cloak/hood wearing cross burning, orphanage mortgage foreclosing ,war starting ,lying ,cheating ,elitist,racist party."

but you like it eh? that says volumes about you ,and is why i never have yet met a hard line republican i would knowingly sit down at the same table with for a meal.

by and large republicans are sanctimonious , pretentious,fat,richer than anyone needs to be,conniving ,users, manipulators. most never worked a day ,not real work anyway. they either ripped some one else off to get(eg; silverado savings and loan /j mccain or fatcat investor bailout @ taxpayer ewxpnse) their money ,or inherited most of it ,and use that to "work" and get richer.

laff @ "Work" = oxymoron to a republican

totally disgusting and repugnant and all of that PLUS absolutely no clue what noblesse oblige means...

sub-humans.

Bachmann could be the least intelligent member of Congress, and that's saying quite a lot, given the competition for that title.

Michele Bachmann, is an idiot; can I say that? AIG was a Bailin. Bachman's stupid point confirms that the Republicans know NOTHING about the economy. How about this: years of a Republican controlled executive branch, congress, and with the efforts of corporate lobbying, repealed a number of regulatory safeguards that kept banks and investment firms from creating opaque financial vehicles. The lack of transparency in this firms has led to a death spiral of asset valuation, as no company is clear how to mark their assets (good or bad) to the market. In short, sometimes regulation of market pushes the market, with an invisible hand, towards stability and efficiency.

"The bailout we are interested in is bailing out the American taxpayer,” said Rep. Jeb Hensarling, R-Tex., chairman of the conservative Republican Study Group.

the article continues "...According to the group, the solution to the financial meltdown is to lower capital gains and corporate tax rates to get money off the sidelines and into the economy"

yeah and the solution to having a headache is cutting off your head...

the above shows clearly WHAT A BUNCH OF RIP OFF CON-ARTIST PUBLIC MANIPULATORS REPUBLICANS ARE , THEY CAN LIE BETTER THAN A SONGBIRD CAN SING..EFFORTLESSLY

"The bailout we are interested in is bailing out the American taxpayer,” said Rep. Jeb Hensarling, R-Tex., chairman of the conservative Republican Study Group.

note: the above is written in republican-speak , a very esoteric language indeed...for a clearer understanding kindly substitute "fleecing" for "bailing" and "bailing out" in the above paragraph to get the true meaning.

The establishment is screwing the taxpayers and the lower level management (local govt., house) to take care of their banker buddies so they can retire with their pensions and a cushy lobbyist job when/if they ever get voted out. They don't work for you or care about you. Haven't you realized that yet!

Too bad Obama's top advisors work for the companies that are getting the bailouts.
He's friends with terrorists, black separatists, cheats and liers.
Obama needs better friends.

bah, the only lying loser is you and the worthless turds you're making excuses for. And Peloser and Reid are running like cowards again instead of doing the job they're paid to do. make excuses and lie all you want bah, at the end of the day you're still an ignorant coward.

Gotta love the blame game as we all know it gets us where we need to be....SARC OFF....

Did anyone meet the challenge put out previously that ties Bush to this mess in detail? Not just in tired rants

hey J , i can tie bush to this problem instantly you moron . #1...HES A REPUBLICAN (= lair and con artist ,so of course he is in on all this HES A REPUBLICAN!!! THATS WHAT THEY DO!!!

AND #2 HE HAS VETO POWER SO HOW DID THE LEGLISLATION THAT ALLOWED THIS TO HAPPEN BECOME LAW? HE HAD TO HAVE NOT VETOED IT , THATS HOW AND BY NOT DOING SO HE WAS EITHER A(IGNORANT ,WHICH I CAN BELIEVE OR B) COMPLICIT(LOOK IT UP)

thirdly (but not nearly lastly) he personally approved the bailouts so far ,the treasury secretary and the fed dont lift a finger without the presidential approval from his highness king george , head of the republican rip off "moral majority"

go on ,try to cover it up with some kind of doofy republican/moron spin but honestly, this last weeks events completely killed any republicans' chance at the oval office for this election . so enjoy your tax increase !!

I want to know why big businesses get bailed out all the time, what about we the people! I could use some bailing out!!!!!

Poster "Truth Matters"-wrote the first post but must not be able to read:Note the first paragraph of the blog entry-
"ABC News' Dean Norland reports: Conservative House Republicans want the US Treasury secretary and the Federal Reserve Board chairman to stop the bailouts. "-- Mr Truth goes on to say:"Republicans believe in privatization of profits and socialization of losses."

Seems Mr Truth got a little lost...must be the GREAT Gubenment Edumacation he gots.

whats with all the stupid/moronic comments from posters using J or j?

dont give the letter a bad name ,use something different for your screen name that is more descriptive of yourself ,something like " republitard a55hat" or just plain ol "retardo"...

i cant WAIT until i get my comparatively insignificant tax cut and the rich users get a REAL TAX INCREASE with NO loopholes and REAL JAIL TIME for business that try to gouge the consumer with price increases or hurt the economy with unnecessary job layoffs to make up for it...

things are going to be just a bit different this time around .

oh yes , there will be no more arbitrarily spreading business tax cost straight to the consumer via price hikes and layoffs ,not without some oversight from UNCLE SAMMY aka obama/nancy/harry etc etc...

hey republicans ,heres the news....easy street is a thing of the past . get ready to pay up big time...dont believe me? JUST WATCH AND SEE!!!

"There's no business like show business."
That's my reaction to the GOP's latest hizzy fit. Deregulation started with Ronald Reagan. He denoucned FDR and tried to eliminate all of the regulations that FDR put in place to protect working class people from being robbed by the rich.
Carly Fiorina, the RNC Victory Co-chairman, helped herself to a $ 21 million golden parachute as Hewlitt Packard tanked.
The architect of the current mess was none other than former Republican Senator Phil Gramm. He railroaded the Gramm-Leach-Bliley act in 1999 which gave a green light for the current mess (Source USW@Work.) He also ramrodded the Commodity Futures Modernization aCt in 2000 which prevented the SEC from regulating financial instuitions like hedge funds or investment banks. (Source James Moore, Huffington Post, Sept 18) None of the Republicans found any of this objectionable. Furthermore, Gramm is McCain's economic advisor.
The Republicans have always been giving bail-outs to the rich in one form or the other. Their current posturing is just a cover up because they depend on the rich for political contributions.
If they're for real, they need to back up Obama and Biden's proposals to tax the rich. Actually Obama's proposals are a lot milder than anything I'd want to see. For the last 8 years, with McCain's full consent,the rich have been robbing this country blind. Incidentally Donald Trump one of the biggest gurus of greed just endorsed McCain. Why?
Pay back is long overdue.
If we want to save this country, we need to send a message to every Republican candidate, presidential and Congressional, we need to echo Donald Trump's famous words: "YOU'RE FIRED."

To all the Republican deniers
Bush was in the Whitehouse for the last 8 years.
If you want to blame Congress, then the Republicans had a congressional majority in BOTH houses for 6 of the last 8 years.
So PLEASE STOP THE LYING.

I am asking everyone to email a note to Senator Boxer who is the head of the Senate Ethics Committee to ask him to investigate Sen Obama breaking the Logan Act in his attempt to get Iraq to not withdrawl troops until he took office. This is a well known story with Iraqi saying he requested it. Here is the note I sent. you can put your name in place of mine at the bottom. Please make sure you include your name and state and county at the bottom. You can exclude pumapac if you desire. Please do a bcc or blind copy if you can to prowl@pumapac.org

The more people who do this the better chance we have of getting some action on this terrible act of treason and selfishness allowing people to maybe die in a war so he could be elected. Everyone is invited to come to blog.pumapac.org a place where the common person is trying to have his voice hear. A super friendly place. please pass this around to other blog sites that might attract people to join in this effort.

Senator@boxer.senate.gov

SUBJECT: Obama in violation of Logan Act!

9/19/08
PumaPac.org
Contact: Murphy@pumapac.org

Dear Member of the Senate Ethics Committee,

I am writing to request that you open an investigation into the actions of Senator Barack Obama with regard to his July visit to Iraq. News reports, as well as the statements from Senator Obama's own campaign, confirm that Senator Obama attempted to negotiate a plan for troop withdrawals and a framework for the American presence in Iraq in such a way as to benefit him politically. This is clearly an unethical way for a member of the United States Senate to act, using his status and leverage as a Senator and prominent candidate to undermine the Administration and to benefit his own political career. It also appears to be a direct violation of the Logan Act.

From the Logan Act:
"Any citizen of the United States, wherever he may be, who, without authority of the United States, directly or indirectly commences or carries on any correspondence or intercourse with any foreign government or any officer or agent thereof, with intent to influence the measures or conduct of any foreign government or of any officer or agent thereof, in relation to any disputes or controversies with the United States, or to defeat the measures of the United States, shall be fined under this title or imprisoned not more than three years, or both."

I am a member of Puma PAC, People United Means Action (http://pumapac.org). We are the Voice of the Voters in the Democratic Party and we strongly oppose Senator Obama's selection as our Party's nominee. We believe he is an unethical politician, disloyal to the fundamental values of our democracy.

Thank you for your consideration and time.

Sincerely,

first initial and last name and county state
Puma PAC Democrat

Fannie approved (the purchase of) 40 yr mortgages for WaMu and credit unions about 3 years ago. Get some refi action going on in those markets, mortgages payable over a 100 yrs (hehehehe) and when credit issues shake out everyone can refi into lower yearly terms or something. Then we can all lease our homes/McMansions and pay the banks for the privilege. I mean, wasn't that the idea behind the interest only mortgage?
I think people are too caught up in the November election. Something had to have been done a year ago and frankly, the new Prez doesnt even take office for nearly 4 months. I like the parliamentary system -- you call an election and it happens in 4 weeks - no two year long campaigns.

Not my Grandfather’s America: The destructive forces killing our county…and it’s not the terrorists

There are not enough words or emotions to express my anger. The war, the bailouts, the unending American arms sales to despot nations, American aid to corrupt governments, the lobbyists- the general attitude that adults should not be held accountable for themselves or their actions. Fortunately, I was not raised by Baby Boomers, but by a mother and father who inherited their parenting and life skills from the Greatest Generation. Like my grandparents, my parents lived well within their means, worked hard and lived with integrity. They invested wisely and saved money for unforeseen setbacks. My siblings and I were raised on principles of personal accountability and responsibility. I do not feel sorry for people losing their homes. If you purchased a home without having, at least, 6 mortgage payments in a savings account—you are living irresponsibly( yes, buy a house you can actually afford). If you have made a living off of people’s stupidity- you are corrupt. As for our “government,” they have come to terrorize us- more war and arms sales that have only made us less safe; more taxes (our money) to fund their fiscal irresponsibility in the form of bailouts, zero-gain domestic projects and fanciful foreign ones. It is outrageous, really, when you think of it---the most responsible among us- those who work hard, earn an honest living and pay their taxes- year after year- are the very people making this abuse possible. I am certain there is a word for it: suicide-bomber perhaps? This election cycle- I will vote every senator and representative, currently in-power, out of office. It may not change a thing, but I want those morons to feel my fury. Next…how to get rid of all those worthless bureaucrats? God save the people.

LOOK AT THE DATE!
By STEVEN A. HOLMES

Published: September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.

''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''

Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 per cent of loans in the conventional loan market.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''

Under Fannie Mae's pilot program, consumers who qualify can secure a mortgage with an interest rate one percentage point above that of a conventional, 30-year fixed rate mortgage of less than $240,000 -- a rate that currently averages about 7.76 per cent. If the borrower makes his or her monthly payments on time for two years, the one percentage point premium is dropped.

Fannie Mae, the nation's biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.

Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites.

Home ownership has, in fact, exploded among minorities during the economic boom of the 1990's. The number of mortgages extended to Hispanic applicants jumped by 87.2 per cent from 1993 to 1998, according to Harvard University's Joint Center for Housing Studies. During that same period the number of African Americans who got mortgages to buy a home increased by 71.9 per cent and the number of Asian Americans by 46.3 per cent.

In contrast, the number of non-Hispanic whites who received loans for homes increased by 31.2 per cent.

Despite these gains, home ownership rates for minorities continue to lag behind non-Hispanic whites, in part because blacks and Hispanics in particular tend to have on average worse credit ratings.

In July, the Department of Housing and Urban Development proposed that by the year 2001, 50 percent of Fannie Mae's and Freddie Mac's portfolio be made up of loans to low and moderate-income borrowers. Last year, 44 percent of the loans Fannie Mae purchased were from these groups.

The change in policy also comes at the same time that HUD is investigating allegations of racial discrimination in the automated underwriting systems used by Fannie Mae and Freddie Mac to determine the credit-worthiness of credit applicants.

Alright, its been 2 months and history shows this "Shock Doctrine" Bailout was a huge mistake.