Quote:
Originally Posted by buffa98
The banks were forced to lower their standard as lenders due to the Community Redevelopment act of 1993-4?
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The CRA is
from 1977, and it doesn't appear that any of the legislative changes would have influenced the housing bubble. What could have was lack of federal regulation such that the loans were consistent with safe and sound operation, but that happens on an administration by administration level. If the administration during the bubble was not insuring that the loans were safe and sound then there could be problems with any loans regardless of who they were to. Something similar happened after 9/11 after
thousands of FBI agents were transfered from white collar crime to terrorism, so naturally there was a lot of white collar crime that slipped through. One bill that did have a large influence on the bubble was the repeal of the
Glass-Steagle act, but the whole formation of the bubble was due to many other factors.