Bloomberg once blamed end of 'redlining' for 2008 collapse

[melman]

WASHINGTON (AP) — At the height of the 2008 economic collapse, then-New York Mayor Michael Bloomberg said the elimination of a discriminatory housing practice known as “redlining” was responsible for instigating the meltdown.

“It all started back when there was a lot of pressure on banks to make loans to everyone,” Bloomberg said at a forum that was hosted by Georgetown University in September 2008. “Redlining, if you remember, was the term where banks took whole neighborhoods and said, ‘People in these neighborhoods are poor, they’re not going to be able to pay off their mortgages, tell your salesmen don’t go into those areas.’”

He continued: “And then Congress got involved -- local elected officials, as well -- and said, ‘Oh that’s not fair, these people should be able to get credit.’ And once you started pushing in that direction, banks started making more and more loans where the credit of the person buying the house wasn’t as good as you would like.”

Bloomberg, a billionaire who built a media and financial services empire before turning to electoral politics, was correct that the financial crisis was triggered in part by banks extending loans to borrowers who were ill-suited to repay them. But by attributing the meltdown to the elimination of redlining, a practice used by banks to discriminate against minority borrowers, Bloomberg appears to be blaming policies intended to bring equality to the housing market.

The term redlining comes from the “red lines” those in the financial industry would draw on a map to denote areas deemed ineligible for credit, frequently based on race.

“It’s been well documented that the 2008 crash was caused by unethical, predatory lending that deliberately targeted communities of color,” said Debra Gore-Mann, president and CEO of the Greenlining Institute, a nonprofit that works for racial and economic justice. “People of color were sold trick loans with exploding interest rates designed to push them into foreclosure. Our communities of color and low income communities were the victims of the crash, not the cause.”


https://apnews.com/8cbb1fafbb4faf01e8d9571363979501

[Prosper]

1. OPINION: Bloomberg considers himself and wants to be considered above reproach.

[Prof.Higgins]

11. Why are we attacking Democratic candidates instead of Trump. Circular firing squad posts

like this are exactly what Trump needs to reduce the Democratic Party's general election turnout.

I am eager to read here about major CURRENT policy differences among our Democratic candidates in the form of factual and soundly reasoned debate. Cherry picking from other candidates histories doesn't further the cause of any candidate you might support and, sadly, critical solidarity of the Democratic Party.

[jcmaine72]

20. These are valid criticisms and questions concerning Bloomberg and his past.

Especially those concerning his tenure as mayor of NYC, where he both presided over and vigorously defended that city's Stop-And-Frisk program, under which THOUSANDS upon THOUSANDS of African-Americans and other POC had their civil rights violated.

This is not "cherry picking" some insignificant trifle or other from his schoolboy days. This should be a serious point of concern for anyone who values the rule of law and civil rights. As per Federal Judge Shira Scheindlin, the Stop-And-Frisk program racially profiled young African-American and Latino males and that is unconstitutional.

https://ccrjustice.org/home/press-center/press-releases/landmark-decision-judge-rules-nypd-stop-and-frisk-practices

Here is a direct quote from Mr. Bloomberg defending Stop-And-Frisk.

Did you happen to hear what he said? "We disproportionately stop whites too much and minorities too little". Wow!

I agree that solidarity is important, but do you really want to be in solidarity with someone who once said that? We honestly can't do better than this as a party?

It's a legitimate question to ask, and one I hope more people will ask before blindly jumping on his store-bought bandwagon.

[Prosper]

24. That is not an attack, I am sure that is the same for all the candidates. Other than liar in chief a

and the Repugs I hold all the Democratic candidates above reproach. I am either calling to task or criticizing Trump or republicans. The post right after this thread was blaming Nixon for passing the HMOACT that opened the floodgate for profiteering from healthcare. I shared my experience as an elected labor official dealing with and then attacking the HMO. I would appreciate it if you would delete the first line of your post. I posted a thread about not calling out and attacking @ https://www.democraticunderground.com/1287452239 .
Please read it Thank you.

https://www.democraticunderground.com/1287452239

[jcmaine72]

12. Obviously with enough $$$$ spread around, there's no shortage of those who will agree with him.

Accountability is only for those who can't afford to buy unaccountability.

[melman]

2. video

Link to tweet

[Hassin Bin Sober]

13. What a load of malarkey.

I’m in the mortgage business. This is a right wing trope.

It wasn’t Fannie/Freddie Community Reinvestment Act (CRA) loans that cratered the industry- it was non Freddie/Fannie predatory loans cooked up by investment houses and hedge funds to get in on that “easy money” flying around. These awful loans were subprime bad credit loans, no doc loans, and non owner occupied no money down loans. Bear Stearns, Washington Mutual, Morgan Stanley, Capital One all had the niche portfolio loans.

And yeah, Fannie started buying up that subprime crap at the end to cash in but the CRA loans were conservatively underwritten loans that mostly conformed until everything turned to shit. Even then they outperformed.

Usually when I see someone peddling this nonsense the next thing out of their mouth is how it’s all Barney Frank’s fault. It wasn’t Barney Frank’s fault but they usually cite some old video of Barney protecting FNMA.

[George II]

3. If we were to cherry pick "negative" issues for every candidate we'd have none left to vote for.

[DrToast]

8. This is true

Everyone has baggage.

[democrattotheend]

15. That doesn't mean it shouldn't be exposed and discussed

I don't get why some people here seem to think Bloomberg is above being vetted.

[DrToast]

16. Not saying that at all

It should be brought up.

[underpants]

4. Woof! That's bad.

[Uncle Joe]

5. I agree underpants.

[Kaleva]

6. Dr. Elenora Woods, president of Chattanooga's NAACP chapter, praised Bloomberg

From the article in the OP

"Introducing Bloomberg at an event in Chattanooga, Tennessee, Dr. Elenora Woods, president of the city’s NAACP chapter, said he would be a tireless fighter for economic justice for black Americans.

“Look, I know what racism looks like. I know what it looks like, and that’s not Mike Bloomberg,” she said."

https://apnews.com/8cbb1fafbb4faf01e8d9571363979501

[melman]

7. Jamil Smith

Link to tweet

[George II]

9. Jamil Smith? "Lol".

[Kaleva]

10. Presidential Candidate Bloomberg Endorsed by 3 Black Lawmakers

"U.S. presidential candidate Michael Bloomberg on Wednesday won endorsements from three Congressional Black Caucus members, a positive sign for his campaign, which has drawn scrutiny lately over his past support for a controversial policing tactic.

The three included Democratic U.S. Representative Gregory Meeks of New York City, where Bloomberg was mayor for 12 years.

As a senior caucus member and chair of a caucus fundraising arm, his is one of the highest-profile endorsements yet for Bloomberg, who is seeking his party's nomination to challenge Republican President Donald Trump in November's election.

Meek's endorsement, first reported by Reuters, signals that Bloomberg is building support among some top African-American politicians despite a 2015 audio recording that surfaced on Tuesday. In the recording, Bloomberg made a blunt defense of a policing strategy during his mayoralty, known as stop-and-frisk, that disproportionately ensnared blacks and Latinos."

https://www.voanews.com/usa/us-politics/presidential-candidate-bloomberg-endorsed-3-black-lawmakers

[Aaron Pereira]

14. Sounds like every Republican in 2008 trying to explain the housing collapse.

He should tell us if his opinion has changed.

[Gravitycollapse]

17. Would you believe him if he said it has? I wouldn't

[Aaron Pereira]

19. Probably not.

Regardless, I'd really like to hear him explain why one of the most destructive tools of financial discrimination in the history of our country is a good idea. In detail.

[Garrett78]

18. People twisting themselves into knots defending Mike fucking Bloomberg has got to be...

...the single saddest thing I've witnessed on DU. Or is this now RU?

[bluewater]

21. I see what you did there.

[Garrett78]

22. I'm not kidding, though. It's deplorable. People should be deeply embarrassed.

[bluewater]

23. +1000

[ms liberty]

26. This. n/t

[George II]

27. RU?

[David__77]

25. I don't like the sound of that.

This along with the matter of putting police in certain areas strikes me as “cut credit, send cops.”

[jmg257]

28. Makes sense...politicians LOVED to say things like: 'the housing market is up!'

'More 1st time home buyers then ever!'


“And then Congress got involved — local elected officials, as well — and said, ‘Oh that’s not fair, these people should be able to get credit.’,” Bloomberg continued. “And once you started pushing in that direction, banks started making more and more loans where the credit of the person buying the house wasn’t as good as you would like.”

Watch The Big Short.

"The problem back then, amply illustrated in The Big Short by idiot estate agents and greedy bankers, was that the American banks were lending huge amounts of money to people who had little hope of repaying it if anything went wrong with the housing market. "

"The Miami stripper portrayed in The Big Short, who owned five houses and a condo, was perfectly plausible as a symbol of the madness of the time. They called such lending “subprime”, where even the jobless and the fraudulent could get a dream home.

[jmg257]

29. No, he really didn't, he said it was "the start". He explains wall street' roll re: mortgages