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<DIV></DIV>
<DIV>I had no doubt that this one really is by Card, but he's around 75%
wrong.</DIV>
<DIV> </DIV>
<DIV>My favorite on-line gospel columnist ran a summary of this, so I had
already composed a quick response. Some of the contents I had previously posted
here, in response to something else greenBubble or someone dug up. Basically my
objections were:</DIV>
<DIV> </DIV>
<DIV>1) Fannie and Freddie's problems had as much to do with pressures the
market put on them as pressures congress put on them,</DIV>
<DIV> </DIV>
<DIV>2) Saying that Fannie and Freddie giving out loans to people who weren't
good risks is THE root of the problem is absurdly partisan. It is definitely one
piece of the puzzle, but no more than one piece.</DIV>
<DIV> </DIV>
<DIV>Which leads me to doubt that Card is either a "liberal" or a "Democrat,"
but as I am neither, perhaps he is and I just don't know how to recognize one. I
liked Ender's Game too, and his alternate history of North America started well,
although the later novels just seemed to lose the magic of the first one.</DIV>
<DIV> </DIV>
<DIV>Siarlys</DIV>
<DIV> </DIV>
<DIV>P.S. If anyone is interested, here is the longer version:</DIV>
<DIV> </DIV>
<DIV>
<DIV>EVERYONE who points the finger at ONE allegedly overlooked cause of the
financial crisis, while denouncing all others that have allegedly received more
attention, is absolutely wrong. Card is no different, and his line of attack is
not original.</DIV>
<DIV> </DIV>
<DIV>
<DIV>It has been gospel to the dominant factions in the Republican Party since
about 1980 that government should take its hands off the stock markets, the
financial markets, and business generally, expecting that "market forces" would
generate not only prosperity but impeccable Norman Rockwell morality and a sound
economy we could all rely on.</DIV>
<DIV> </DIV>
<DIV>That has proved to be hogwash. It was already proved to be hogwash, only a
few years after Reagan deregulated the Savings and Loan industry. What had been
small, community-based savings institutions, offering relatively easy access to
mortgage money for local working families, became a prime target for large-scale
speculators and spectacular mergers, resulting in a crash for which taxpayers
picked up a tab running into billions of dollars. A well regulated Savings and
Loan industry would not have been attractive to those speculators, nor would
such large regional chains have been consolidated under the previous rules. (My
money is in a credit union, which still serves its original purpose. When credit
unions get "deregulated" and some highly leveraged investment bank offers to
"buy the shares" of current "members" I will take all my money out and never
look back.)</DIV>
<DIV> </DIV>
<DIV>In the biased media Card denounces, I found an article which tells another
side of the undoubted errors committed by Barney Frank, Christopher Dodd, et.
al.:</DIV>
<DIV> </DIV>
<DIV>
<DIV><A
href="http://www.nytimes.com/2008/10/05/business/05fannie.html?hp">http://www.nytimes.com/2008/10/05/business/05fannie.html?hp</A></DIV>
<DIV> </DIV>
<DIV><FONT color=#00ffff>Fannie, a government-sponsored company, had long helped
Americans get<BR>cheaper home loans by serving as a powerful middleman, buying
mortgages<BR>from lenders and banks and then holding or reselling them to Wall
Street<BR>investors. This allowed banks to make even more loans — expanding
the<BR>pool of homeowners and permitting Fannie to ring up handsome
profits<BR>along the way.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT color=#00ffff>But by the time Mr. Mudd became Fannie’s chief
executive in 2004, his<BR>company was under siege. Competitors were snatching
lucrative parts of<BR>its business. Congress was demanding that Mr. Mudd help
steer more loans<BR>to low-income borrowers. Lenders were threatening to sell
directly to<BR>Wall Street unless Fannie bought a bigger chunk of their riskiest
loans.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT color=#00ffff>Angelo R. Mozilo, the head of Countrywide Financial,
who did not return<BR>telephone calls seeking comment, told Mr. Mudd that
Countrywide had other<BR>options. For example, Wall Street had recently jumped
into the market for<BR>risky mortgages. Firms like Bear Stearns, Lehman Brothers
and Goldman<BR>Sachs had started bundling home loans and selling them to
investors —<BR>bypassing Fannie and dealing with Countrywide
directly.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT color=#00ffff>“You’re becoming irrelevant,” Mr. Mozilo told Mr. Mudd,
according to two<BR>people with knowledge of the meeting who requested anonymity
because the<BR>talks were confidential. In the previous year, Fannie had already
lost 56<BR>percent of its loan-reselling business to Wall Street and
other<BR>competitors.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT color=#00ffff>“You need us more than we need you,” Mr. Mozilo said,
“and if you don’t<BR>take these loans, you’ll find you can lose much more.”
</FONT></DIV>
<DIV> </DIV>
<DIV>If Fannie Mae were a government agency, they could have said, great, the
market is now doing the job, we are no longer needed. But, as a corporation with
stock holders, they had to work at staying in the market. Well, that is already
a long-winded reply to a widely broadcast email. But Card and many others
spouting the same line are pots calling kettles black when it comes to one-sided
analysis.</DIV></DIV></DIV></DIV>
<DIV> </DIV>
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