In this afternoon’s comments on my morning post offering to debate him on whether or not “Diversity was a major factor in the mortgage meltdown,” investment adviser, blogger (The Big Picture), and author of Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy Barry Ritholtz asks:
Ritholtz said…How about some evidence, hard data, facts?
Or are you more comfortable with nudges, hunches and squishy junk.
Show me some hard evidence!
Mr. Ritholtz apparently hasn’t been paying attention here, but I also fear I’ve overloaded my regular readers so much on the topic of diversity and mortgages over the last couple of years that many would rather hear that I’m about to start a new 9-part series on track & field statistics (my all-time least popular obsession) than hear the same old same old about diversity and the mortgage meltdown.
So, I’ll just link to a few highlights in chronological order. The data piles up as we get closer to the present, but it’s helpful to understand how my thinking evolved from the point when I had no idea what I was talking about regarding mortgages.
Let’s begin with my first blog post on the subject on August 12, 2007, a couple of weeks into the subprime collapse, where you can see my hesitancy to get involved in a topic with a topic where I didn’t know anything, but I did remember a few things that almost everybody else seemed to have forgotten:
I’m sure the private financial markets were quite capable of blowing up a big bubble by themselves in the eternal see-saw struggle between greed and fear, but this political pressure for lending to minorities with doubtful credit must have exacerbated the problem. About half of all mortgages for blacks and Hispanics are subprime, versus about one-sixth for whites.
A reader has sent me some links to articles from 5 to 9 years ago to show me I’m not hallucinating about what I remember. The first are from early in this decade about Fannie Mae’s big plans for boosting mortgages for minorities. Now, I don’t pretend to understand what Fannie Mae is (but does anybody?). It’s some kind of quasi-governmental publicly-traded for-profit thinga-ma-bob, but Fannie Mae’s past pronouncements do make interesting reading at present.
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