1. Not sure where you are getting that figure from, but even if it’s true, there should be some verification process for important info. We don’t just ask clients what they think their credit score might be, when we process an auto application, we verify it with ChoicePoint.
2. If Gram did not anticipate the free market potentialfor different loan types, I would be shocked. I think that was the good intentions of the bill. There is nothing inherently wrong with different loan types, but there should be qualifications to meet.
3. Did Graham anticipate the underwriting cessation? Probably not. But, he and his successors could have done a better job in making certain that the rest of Congress knew what Barney Frank and others were doing in their social engineering of these programs via Fannie and Freddie.
Bottom line, there is a lot more involved with GLB than just the mortgage business and I can think of a whole lot more that was negative, than positive. Having international mega-corporations absorb nearly all of the important financial transacations has led us to the point of too many that are now too big to fail, and so we dump more money down a black hole that only gets blacker in the process.
I am a firm believe in the free market and the original American way, but there is no way that you can not balance that system with limited, reasonable oversight along with limitations on being able to become so large and important that you can abscond with an industry that controls so much of the American economy.
I believe Senator Gramm was an overall, good Senator. Both as a Democrat, and later as a Republican. However, I agree that GLB was one of his failures.
This article’s beginning summed it up well. You no longer deal with human beings when it comes to your finances (insurance, banking, brokers, etc) and that has taken an all-important ingredient out of the equation. That’s been replaced by an un-caring, and generally over-seas corporation that will never look out for the client’s best interest.
Between GLB and the generally Demorcratic desire to push homeownership into one of the RIGHTS (instead of a dream) of being an American, has caused most of our financial difficulty today.
that 40% of home loan applications would include fraudulent information? Did Gramm anticipate the wide variety of loan types made available after Clinton signed the bill? Zero down loans, interest only loans, adjustable rate loans? Did Gramm anticipate that lenders would STOP UNDERWRITING?
A return to the good old American way? and what exactly would that entail? Glass Steagall was enacted to curb the integration of financial services that had in the early part of the 20th century placed the economy in peril. 70 or so years later, it was repealed to return to an era of largely unbridled corporate opportunism. And we’re shocked by the results? The American way was the path on which we once again tread. And look where that path has, once again, taken us.
Should Gramm have expected companies to stop underwriting? Absolutely. Financial services had already started relying on web based products and bundling of risk before GLB passed. Citi and Travelers had already merged. Personal lines representatives were already addressing seminars about the wonders of no-underwriting risk bundling as the wave of the future. Anyone who underwrote was an old fashioned, bricks and mortar dinosaur.
I think the answers to Senator Gramm’s questions are evident.
In order:
1. Not sure where you are getting that figure from, but even if it’s true, there should be some verification process for important info. We don’t just ask clients what they think their credit score might be, when we process an auto application, we verify it with ChoicePoint.
2. If Gram did not anticipate the free market potentialfor different loan types, I would be shocked. I think that was the good intentions of the bill. There is nothing inherently wrong with different loan types, but there should be qualifications to meet.
3. Did Graham anticipate the underwriting cessation? Probably not. But, he and his successors could have done a better job in making certain that the rest of Congress knew what Barney Frank and others were doing in their social engineering of these programs via Fannie and Freddie.
Bottom line, there is a lot more involved with GLB than just the mortgage business and I can think of a whole lot more that was negative, than positive. Having international mega-corporations absorb nearly all of the important financial transacations has led us to the point of too many that are now too big to fail, and so we dump more money down a black hole that only gets blacker in the process.
I am a firm believe in the free market and the original American way, but there is no way that you can not balance that system with limited, reasonable oversight along with limitations on being able to become so large and important that you can abscond with an industry that controls so much of the American economy.
That’s just the way I see it.
I believe Senator Gramm was an overall, good Senator. Both as a Democrat, and later as a Republican. However, I agree that GLB was one of his failures.
This article’s beginning summed it up well. You no longer deal with human beings when it comes to your finances (insurance, banking, brokers, etc) and that has taken an all-important ingredient out of the equation. That’s been replaced by an un-caring, and generally over-seas corporation that will never look out for the client’s best interest.
Between GLB and the generally Demorcratic desire to push homeownership into one of the RIGHTS (instead of a dream) of being an American, has caused most of our financial difficulty today.
Just my opinion, though.
A wave? Can you say: TSUNAMI
that 40% of home loan applications would include fraudulent information? Did Gramm anticipate the wide variety of loan types made available after Clinton signed the bill? Zero down loans, interest only loans, adjustable rate loans? Did Gramm anticipate that lenders would STOP UNDERWRITING?
A return to the good old American way? and what exactly would that entail? Glass Steagall was enacted to curb the integration of financial services that had in the early part of the 20th century placed the economy in peril. 70 or so years later, it was repealed to return to an era of largely unbridled corporate opportunism. And we’re shocked by the results? The American way was the path on which we once again tread. And look where that path has, once again, taken us.
Should Gramm have expected companies to stop underwriting? Absolutely. Financial services had already started relying on web based products and bundling of risk before GLB passed. Citi and Travelers had already merged. Personal lines representatives were already addressing seminars about the wonders of no-underwriting risk bundling as the wave of the future. Anyone who underwrote was an old fashioned, bricks and mortar dinosaur.
I think the answers to Senator Gramm’s questions are evident.