Not that it should surprise anyone, George W. Bush was warned about the financial crisis as early as 2005:
In 2005, faced with ominous signs the housing market was in jeopardy, bank regulators proposed new guidelines for banks writing risky loans. Today, in the midst of the worst housing recession in a generation, the proposal reads like a list of what-ifs:
-Regulators told bankers exotic mortgages were often inappropriate for buyers with bad credit.
-Banks would have been required to increase efforts to verify that buyers actually had jobs and could afford houses.
-Regulators proposed a cap on risky mortgages so a string of defaults wouldn’t be crippling.
-Banks that bundled and sold mortgages were told to be sure investors knew exactly what they were buying.
-Regulators urged banks to help buyers make responsible decisions and clearly advise them that interest rates might skyrocket and huge payments might be due sooner than expected.
Not surprisingly, George doesn’t seem to have any memory of this:
PRESIDENT GEORGE W. BUSH: You know, we anticipated some issues revolving around Fannie Mae and Freddie Mac, and early in my administration called for a regulator, on the knowledge that an implied government guarantee could cause, and eventually did cause, the agency to become excessive in its lending practices, which eventually was a part of the financial meltdown.
And I can remember sitting in the Roosevelt Room with Hank Paulson and Ben Bernanke and others, and they said to me that if we don’t act boldly, Mr. President, we could be in a depression greater than the Great Depression.
GIBSON: When was that?
BUSH: That was, I would say, five weeks, four weeks after we began to deal with some — like AIG…
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