Talk:Community Reinvestment Act

message: I'm glad to see that this page has been edited a fair amount since I last visited the article.  Last time I visited this page I thought it was very strange to see a strong bias in the article, with statements written in bold/italics as if someone was trying to say that certain facts were more valid than others (under the "Relation to 2008 financial crisis" section).Arandomwikiguy (talk) 11:54, 2 July 2009 (UTC)
thread_title: Changes and edits

message: I have made several changes:
1) fleshed out the commentary of FDIC chair Sheila Bair and the remarks of Fed Governor Grosznor who both relay extensive evidence against the proposition that the CRA was a significant cause of the housing crisis.  Bair's remarks are unequivocal and deserved to be quoted.
2) removed an irrelevant citation from the section of people making the charge.  I read the article, and it was almost entirely about blaming Freddie and Fannie for the crisis.  It mentions the CRA once and presents no evidence (nor makes the claim) that it caused the housing crisis.
3) added 2 citations by Paul Krugman who has been especially vocal in refuting this idea.  I trust he is "noteworthy" and his opinion on the matter is worth including.
In general I think the whole section is too long, relies too much on listing people on each side of this nonsensical debate, without stating more emphatically that this is not an idea taken seriously in economics.  Aside from some opinions of right wing economists, there is no empirical data presented to make this case.  It is simply an ungrounded hypothesis, plausible in the abstract but completely speculative.  It turns into farce when all the available hard evidence shows the hypothesis to be false.--FNV (talk) 03:38, 18 February 2010 (UTC)
replies: text: A few notes:
a.) Does anyone know where we could find the hard data/statistics that breaks down mortgage loan default rates among CRA-backed sub-prime loans vs non CRA-backed sub-prime loans or other non sub-prime loans?  I've checked the Harvard database and it is pretty complex, I wouldn't mind seeing someone break down some numbers for the general population.
b.) I have personally found Paul Krugman's assertions with regards to current economics and politics to be of dubious worth.  One reason the NYT and Obama administration love giving him so much exposure is because his column/articles always support increases in governmental power over the economy.  Strangely enough this is not what he won the Nobel Prize for.  His 55% quote is completely irrelevant considering he was talking about current loans a year after the initial market drop had occurred.  Whether or not the CRA caused the collapse means the data we want would be from months leading up to collapse, not a year after when all markets were hurting from the overall economic collapse.  Also he unfortunately cites data that is closed off to the general public (Wall Street Journal) which, if he were a Wikipedia contributor, would not be a valid reference.
c.) Opinions of people at the Federal Reserve and government agencies are suspect.  Of course someone at working for the government is going to say that the current crisis is NOT the government's fault.  Unless they give hard data to back up their claims then they should not be quoted in this article.
d.) Are the claims that the CRA didn't contribute to the collapse of 2008 contradicted by the earlier statements regarding CRA loans and Freddie Mac in the 3rd paragraph of the "Sound Practices and Profitability" section?
What we need to find is a good study showing whether or not CRA loans to low-income and other demographics had a higher instance of default than non-CRA loans.  Right now the "Relation to 2008 Financial Crisis" is about 20% supporting the assertion that it helped contribute the crisis and 80% opposing which violates NPOV. Fatrb38 (talk) 06:27, 13 July 2010 (UTC)

text: I added many of the sources to this section. If you want data, one source that's better than most is the Traiger Hinckley study. Check it out and get back to me. The government does not seem to be lying when it says the empirical data does not support a connection. II | (t - c) 07:59, 13 July 2010 (UTC)

text: I just made one more change, which was to remove this statement: "Legal and financial experts have noted that CRA-regulated loans tend to be safe and profitable, and that subprime excesses came mainly from institutions not regulated by the CRA." I removed it because it is a sweeping statement, and it is not specifically supported with a citation. Also, a statement asserting the exact opposite is just as true. I could say: "Legal and financial experts have noted that CRA-regulated loans have not been safe and profitable, and that subprime excesses came mainly from institutions regulated, directly or indirectly, by the CRA." (The reference to indirect regulation is to acknowlege that 75 nonbanks voluntarily agreed to be subject to the CRA standards (after some arm-twisting by HUD.)The point is that there are experts lined up on opposing sides of this issue.Nicholas007 (talk) 00:05, 27 December 2012 (UTC)
thread_title: CRA as purported cause of the housing crisis.

message: I have become concerned of late about bias in Wikipedia.  Frankly, for 10 years I've been impressed as to how well it worked, and has worked - and have been a repetitive, although not prolific or frequent contributor.  In cases where my contributions weren't good they were deleted.  In cases where they were good, they were improved.  Everything as it should be.  
I'm concerned that the NPOV and anti-bias rules can't be maintained, and have seen some troubling things lately (from moderators as well as well as normal contributors.)  I don't know that any policy changes are appropriate.  Wikipedia's weakness - that it can be changed by anyone, for whatever reason - is also it's strength, of course.  Anyway, this youtube video is worth watching, for any concerned about the future of Wikipedia:
http://www.youtube.com/watch?v=TxgSubmiGt8 
To the honest founders, moderators, editors, and contributors of Wikipedia - You've made a great resource, and shown me that such open collaboration can work.  Thank You.  —Preceding unsigned comment added by 97.89.22.141 (talk) 14:45, 25 June 2010 (UTC)
thread_title:  Mis-use of Wikipedia

message: Recent ~14 May 2011 addition....
The Obama administration has increased scrutiny of the provision of credit to poor and African American neighbourhoods. Lenders have come under investigation for not operating in such areas, whether they have halted service there or have never operated in them before.[78] Atlantic financial editor Daniel Indiviglio attributes increasing noncompliance with the CRA to tightening lending requirements.[79]
The italics (my emphasis) gave me a clue to what may be the real driver behind this & it has not been reported yet as far as my searching for straight article goes. The instance mentioned in the Atlantic piece referring to a Bloomberg report of a bank in St. Louis being suddenly in non-compliance most likely never bothered to adjust their practices in light of the post 2010_Census' LMI zone changes within the long established Census tracts leftover from the 2000_Census based ones. Checking old map and data for St' Louis against the 2010's latest did indeed show the shift -- indirectly altering the old "community-to-service" lines to a somewhat economically different one if not just geographically "redrawn".I just haven't found a way to incorporate this dynamic of 'Census tract change oblivious banks' possibly contributing to the percieved increase in recent scrutiny without it being shot down as original research. Thought I'd mention it here so it has a chance of being supported with a credible citation some day. -- George Orwell III (talk) 05:19, 14 May 2011 (UTC)
thread_title:  New scrutiny 

message: The "CRA caused the 2009 housing bubble" talking point has no credibility. Why is this conspiracy theory even included in the article? Ron Paul is not an economist, why is his opinion in the article? I understand wikipedia should avoid bias, but including this article is like reporting on the issue of big foot as follows: "Biologists say big foot is a myth, but others say he is real." In other words we are sacrificing accuracy for "fairness" and "sympathy" to those of a certain political persuasion. 99.169.66.28 (talk) 01:25, 28 December 2011 (UTC)
replies: text: Unfortunately, even patently untrue theories (like the water fuel cell for instance) can still generate enough attention to be notable. This particular right-wing talking point has generated enough attention that leaving it out would mean that the article did not appropriately cover this subject. LK (talk) 05:37, 24 January 2013 (UTC)
thread_title:  Removal of Relation to 2008 financial crisis section 

message: Most experts on the subject,...hold that the CRA did not make a significant contribution of the subprime crisis. I suggest we remove this as OR and weasel wording.  None of the sources in this sentence support the statement. a reader may incorrectly believe economic experts were polled and the majority agreed, instead an editor has found 3 economist who disagreed with one economist. Darkstar1st (talk) 07:16, 28 October 2013 (UTC)
replies: text: Give me a bit of time to find something. I think I've seen reports from investigatory committees about this issue, and they found the CRA is not a factor in the housing bubble. 123.203.195.18 (talk) 14:14, 1 November 2013 (UTC)
thread_title:  ORweasely 

message: An investigation by a major newspaper found that "The City of Cleveland has aggravated its vexing foreclosure problems and has lost millions in tax dollars by helping people buy homes they could not afford." The newspaper added that these problem mortgages "typically came from local banks fulfilling federal requirements to lend money in poorer neighborhoods."Mark Gillespie, "How Cleveland Aggravated Its Foreclosure Problem and Lost Millions in Tax Dollars - All to Help People Purchase Homes They Couldn't Afford," Cleveland Plain Dealer, December 31, 2009. In his book on the crisis, CPA Joseph Fried notes that many of the loans given in the Cleveland program - including a loan to a woman living in a car - would be counted as "prime" by CRA advocates. This is, according to Fried, because many notable CRA proponents, including Janet Yellen, Randall Kroszner, John C. Dugan, and Elizabeth Warren, treat all loans as prime provided they have stated interest rates no higher than 3 percent above average. Fried added that, since many loans related to government programs carry low interest rates by design, the 3 percent method makes them appear better than they are.Joseph Fried, Who Really Drove the Economy Into the Ditch (New York: Algora Publishing, 2012, 140-142.
Not only is there a sourcing issue to the above but I don't see how Cleveland translates into the entire affected sector in question never mind what/how the 3% thing "fits" into any of this (if at all) in the first place. -- George Orwell III (talk) 01:38, 13 December 2013 (UTC)
thread_title:  Latest addition has "poor" sourcing 

message: George Orwell wanted to know how the "3% thing" fits into this. Many of the defenders of CRA, such as John Dugan, Randall Kroszner, Janet Yellen, Eric Rosegren, Richard Neiman, and Elizabeth Warren, defined the quality of loans (prime vs. subprime) on the basis of interest rates rather than the credit-worthiness of the borrower (which would be the normal and conventional way to do it). These people declared that any loan with a rate 3% or more over the normal rate must be "subprime," and any loan with a rate lower than that must be "prime." This was a self-serving standard for government advocates to use since many government home loan program involved low rate loans - even if made to people with subpar credit. The quote from the Cleveland Plain Dealer and from Fried's book on the financial crisis is important because it informs people about this matter. (Eg, the loan made to the woman who lived in a car was considered "prime" because the interest rate on the loan was not excessively high). 
I was surprised and dismayed to see the recent removal of Krugman's canard about commercial real estate loans. Let us keep it, but with the counterpoint (I added) that puts it in proper perspective. 
If you don't like a citation don't remove it. Rather, add your own to counter it. Nicholas007 (talk) 05:41, 13 December 2013 (UTC)
replies: text: I believe your additions keep getting removed because, for starters, both citations associated with the added material are not easily verifiable - do you have something with a working link? - followed by, imo, because it belongs in the Subprime mortgage crisis article more so than the CRA article (if anything). You've kind of synthesized these portions (hidden in the section above) to "fit" into the notion that CRA covered loans that were eventually securitized made up a larger share than the roughly ~6% of all the loans in question. Sorry, I just don't don't see how "prime" or "sub-prime" nuance, even if absolutely true, ultimately matters here - are you saying only "true-sub-prime" loans were counted towards CRA evualations and the "faux-prime" ones were not? -- George Orwell III (talk) 09:10, 13 December 2013 (UTC)
replies: text: I think I understand the point Nicholas is trying to make. If we are going to cite people like Dugan, who claims that CRA did not significantly contribute to subprime lending, we ought to know how Dugan defines subprime vs. prime. However, I also agree with Orwell that the presentation was a little confusing. I think the very latest version is a big improvement.Georges1254 (talk) 14:50, 13 December 2013 (UTC)
replies: text: I think it's pretty straight-forward now - the assertion is claiming "near-prime" (or Alt-A) loans need to be counted separately in the accounting concerning the nuances between "prime" and "sub-prime" calculations, etc. While technically a valid point, in the overall picture & at the time in question - even with the worst case estimates for that "near-prime" class - it would still only shift the data roughly ~4% or so. So if you accepted that CRA qualified loans made up ~6% to ~7% of the total number of loans eventually securitized under the "bubble", using the new sub-class with worst-case accounting would only shift that baseline to ~10% or ~11% (again, assuming all of those can be counted towards CRA evaluation/rating as well).That said, I still don't see how splitting this particular hair changes anything and would now justify inclusion in the article. Quite the opposite - this nuance belongs in one of the several other articles that fall under this "financial crisis" umbrella (if at all) and, more importantly, the references are lacking the support needed to avoid the perception of synthesized content - especially after locating the  How Cleveland Aggravated Its Foreclosure Problem and Lost Millions in Tax Dollars - All to Help People Purchase Homes They Couldn't Afford piece - which seems to be all about secondary loans once a mortgage was secured (secondary home/flipping?). -- George Orwell III (talk) 04:55, 14 December 2013 (UTC)
thread_title:  CRA relation to crisis changes 

message: I reverted this edit adding two sentences about a NBER working paper to the top of the CRA-financial crisis section. 
The reasons are as follows: 
* First, the paper is already referenced in the section in paragraph 4, where it states: "A study by the economists, Agarwal, Benmelich, and Bergman, found that banks undergoing CRA-related regulatory exams took additional mortgage lending risk.[130]"
* Second, the section is currently ordered somewhat chronologically, to inform the reader of how the controversy developed in the press.  Putting that paper at the top of the section breaks the chronology. 
* Third, putting the paper's conclusions at the top implies that it is the most authoritative. However, it is only a non-peer reviewed working paper. The findings of the Congressional Financial Crisis Inquiry Commission, and of the Federal institutions (such as the FED) are more authoritative. 
* Fourth, the addition was worded in a biased fashion, it was not neutrally worded.  
LK (talk) 14:36, 22 September 2015 (UTC)
replies: text:  Fine, but if the "findings of the Congressional Financial Crisis Inquiry Commission, and of the Federal institutions (such as the FED) are more authoritative", they are certainly less credible, as quangos of the current administration. Quis separabit? 14:40, 22 September 2015 (UTC)
replies: text:  The Financial Crisis Inquiry Commission was a bipartisan congressional committee. Like Warren Commission on the Kennedy shooting, we should take it's findings as authoritative, speculations otherwise drift into WP:FRINGE territory. Also, the Federal Reserve (who probably have more information about banks than anyone else)  concurred with the Commission's conclusion; the chair at the time was Ben Bernanke, who is i) a Republican, ii) appointed by G W Bush.  The current Fed chair (a Democrat appointed by Obama) also concurred.  LK (talk) 14:49, 22 September 2015 (UTC)
replies: text:  Agree with LK's points - George Orwell III (talk) 22:24, 23 September 2015 (UTC)

text: perhaps it could be reworded and added at the bottom? Darkstar1st (talk) 10:45, 24 September 2015 (UTC)
thread_title: NBER working paper

message: There are a few concerns that I have with this article. The information seems sound and the article does seem unbiased at this point. However, the links to some of the wiki articles are not working. There are also several citation quotes that are missing and labeled as such. 
Aemanning (talk) 00:48, 17 April 2017 (UTC)
thread_title:  Missing citations and bad links 

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thread_title:  External links modified 

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