I have had several communications in person and via email regarding our speaker on Thursday night - Dr. Doug Duncan, and the appropriateness of "hosting someone who contributed to the financial predicament " that we now find ourselves in as a country. I would like to share with you today the most articulate, and appropriate response on that questions from local economist Howard Blum, who happens to be our speaker next month. He certainly provides straight up food for thought.
"In the final analysis there is more than enough blame to go around for the Fannie and Freddie demise. Perhaps the only person that does not have dirty hands at Fannie Mae is Doug Duncan. FACT: Angelo Mozilo at Countrywide made the CEO of Fannie go to Calabasas, CA and told him that if they did not play ball they would be made irrelevant in the mortgage industry. Countrywide was going directly to Wall Street to securitize mortgage-backed securities (MBS) and Countrywide threatened to bypass them and put them out of business. That was not the only intense pressure brought to bear on Fannie & Freddie.
Members of Congress from urban centers were pressuring Fannie and Freddie to increase minority home ownership without regard for qualifications. Essentially Fannie and Freddie were squeezed by both the government and Wall Street.
Fannie Mae did not create sub-prime loans. Fannie Mae did not create a secondary market for sub-prime loans. Fannie Mae did not create the "blending" of sub-prime and prime mortgages into AAA rated MBS. Fannie Mae did not twist the arms of global banks to buy those wrongly AAA rated MBS.
To place the blame for the housing meltdown on Fannie Mae is to ignore the dozens of fingers in the pie that created the mess. As an economist I can say point blank that there are very few people in this country that truly understand all the contributing factors the the housing sector demise and Doug Duncan is one of them.
People can either come listen to what knowledge and expertise that Doug is willing to share with us or they can keep their head in the sand and point fingers in the wrong direction."
This gives some good insights as to why Dr. Doug Chief Economist for Fannie Mai has been listed in the "Top 100 Most Influential People In Real Estate ," according to Inman News.
1 comment:
Excellent points, Geraldine. We can learn a lot from those who were -- and are -- involved in the process, and certainly individuals like Dr. Duncan with his background and experience are in the best position to help us find the solutions we so desperately need to get us back on track. More listening and less blaming would serve all of us well! I'm looking forward to the event!
Jeffrey Hare
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