Obama Pressuring Banks to Give High Risk Loans to Poor and Minorities

As we learn more about the financial meltdown of 2008, it becomes increasingly apparent that one of the main causes for this economic disaster was government policy that forced banks to extend loans to those people who were unable to pay those back. Government agents put pressure on banks and government banking institutions like Freddie/Franny to give loans to people who under normal circumstances would be unable to pay back these loans and who were especially unable to protect themselves from the exposure to risk that these loans entailed. Misguided government policies ambushed innocent people who believed the dream that politicians peddled and banks were coerced into following, and in 2008 the house of cards came crashing down and peoples lives were ruined. It was not the failure of the markets, the lack of government policy on the issue, evil rich people, George W Bush, or the Republicans who were the minority party in Congress at the time- it was government policy that put pressure on banks that led to the collapse in 2008.

And the lesson apparently was not learned by the Democrats.

From Townhall's Bob Beauprez comes this stunning mind-blowing information:

The Department of Justice is executing a "Witch Hunt" against banks. Through the DOJ's Civil Rights Division, Attorney General Eric Holder is forcing banks to "relax their mortgage underwriting standards and approve loans for minorities with poor credit as part of a new crackdown on alleged discrimination," according to a published report by Investor's Business Daily after reviewing court documents.

The DOJ has already extorted $20 million for weak and poor credit loans from banks that "settled out of court rather than battle the federal government and risk being branded racist." The DOJ admits another 60 banks are already under "investigation." Holder's demanding the banks sign "non-disclosure" settlement agreements barring them from talking while allowing the DOJ to operate behind a curtain of secrecy.

The settlements already extracted from banks force them to make "prime-rate mortgages to low income blacks and Hispanics" with credit problems, even if they are living on welfare. According to IBD, the DOJ has ordered banks to advertise that minorities cannot be turned down for a loan "because they receive public aid, such as unemployment benefits, welfare payments or food stamps." No job; no problem!

In other words, the DOJ is forcing banks to make loans to people that they know don't qualify for them and likely won't be able to afford to repay them, which is precisely the kind of failed public policy that precipitated the financial collapse and recession in 2008.

Can you believe it? Obama took an economy that was going through a usual recession, killed the recovery, set us up for a double-dip recession, and is now working on creating another epic economic collapse!

Read the whole analysis- it'll really scare you!

For more on the background of the Great Recession and how Obama plans to recreate it with his policies, check out The Great American Bank Robbery: The Unauthorized Report About What Really Caused the Great Recession or A Decade of Delusions: From Speculative Contagion to the Great Recession.