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It’s Confirmed: 2008 Mortgage Crisis Was Not the Fault of Poor Borrowers
 

Price-Reduced-Foreclosure-Bank-Owned-2-300x200The narrative that subprime mortgages to the poor instigated the 2008 crash has long been seen as reasonable for a certain conservative faction of the country. A new study dispels that notion once, and hopefully, for all.

 

Duke’s Manuel Adelino, MIT’s Antoinette Schoar and Felipe Severino of Dartmouth released a research paper that vehemently disputes the notion that policies meant to improve access to credit among low-income people and disadvantaged minorities, most notably the Community Reinvestment Act of 1977 (CRA), encouraged banks to make risky loans, which eventually fell through, causing the crash.

 

The new study tells a different story. It details who actually took out mortgages in the time preceding the crisis and who defaulted once the crash hit. The findings fly in the face of the Bush administration and others who were quick to blame the collapse on anyone other than the banks that were purportedly too big to fail and dismal regulatory oversight.

 

According to the paper, the poor, in fact, did not start taking out more and bigger mortgages than the masses. However, it shows that borrowing increased for everyone. It further declares that all the populace believed housing prices would perpetually elevatea thought that led to the fall. It was not loans to the poor.

 

Only 5 percent of the new mortgage debt in 2002 was from the poorest households. That figure did not increase at all from 2002 to 2006.If an explosion in unsustainable mortgages for poor households was behind the crisis, then, according to the researchers, there would have been a big shift toward those kinds of mortgages. But the data does not support that, hopefully ending for good the notion that the disenfranchised caused the tumult.

 

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ALSO SEE:

 

 

Why the Foreclosure Crisis Is One of Most Devastating Examples of Systemic Racism in Generations

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"I'm just trying to make a way out of no way, for my people" -Modejeska Monteith Simpkins

 

AFRICAN AMERICA IS AT WAR

THERE IS A RACE WAR ON AFRICAN AMERICA

THERE IS A RACE WAR ON AFRICAN AMERICANS

THERE IS A RACE WAR ON BLACK PEOPLE IN AMERICA

AMERICA'S RACISTS HAVE INFILTRATED AMERICAN POLICE FORCES TO WAGE A RACE WAR AGAINST BLACK PEOPLE IN AMERICA

THE BLACK RACE IS AT WAR

FIRST WORLD WAR:  THE APPROXIMATELY 6,000 YEAR WORLD WAR ON AFRICA AND THE BLACK RACE

Last edited by sunnubian
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Originally Posted by NSpirit:
It wasn't just conservatives pushing that narrative. NPR pushed it. CNN pushed it. MSNBC pushed it. New York Times pushed it...it was e EVERYWHERE. White people created a narrative and protected themselves from scrutiny.

 

That's exactly what i was thinking as I read it.  

 

I also remember trying to point out the fact that all the mortgages in foreclosure of all the African Americans and Latinos combined would not amount to trillions in 'deficits'/failed mortgages that they were claiming in the first place, and that's including the minorities with 'sub-prime' loans and "balloon" payments.  

 

Really, even this article/"research" is only saying that minorities' mortgages in foreclosure were not the only culprit, rather than pointing out that the total number of minority mortgages alone, couldn't have possibly been the culprit.

 

The "Mortgage Crisis" really was no more than a Ponzi Scheme concocted by the Bush Administration, Big Banks and Wall Street, to EXTORT money from the United States Government (tax payer revenues) [and to recoup their republican campaign donations].  

 

The Racist Propaganda campaign tactic to use Black people and Latinos as their Scapegoat alone was egregious enough, let alone the amount of money they were allowed to fleece from the United States Government and the American Taxpayers.  

 

 

 

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