Subprime Mortgage Crisis and the Economy

The nation’s housing crisis has been called the biggest immediate threat facing the US economy today.

A subprime loan offers borrowers a mortgage, but at a disproportionately high rate they often can’t afford. The subprime market has fueled a record one million foreclosures this year, with an estimated two million expected in 2008.

July 09, 2008: Foreclosure Phil: Journalist David Corn on How McCain Campaign Adviser Phil Gramm Helped Create the Subprime Mortgage Crisis
In the latest issue of Mother Jones magazine, David Corn writes, “Who’s to blame for the biggest financial catastrophe of our time? There are plenty of culprits, but one candidate for lead perp is former Sen. Phil Gramm. Eight years ago, as part of a decades-long anti-regulatory crusade, Gramm pulled a sly legislative maneuver that greased the way to the multibillion-dollar subprime meltdown. Yet has Gramm been banished from the corridors of power? Reviled as the villain who bankrupted Middle America? Hardly. Now a well-paid executive at a Swiss bank, Gramm cochairs Sen. John McCain’s presidential campaign and advises the Republican candidate on economic matters.”

July 09, 2008: Five Ways Wall Street and Washington Set Us Up for the Crash: Author Nomi Prins Explains Where Congress Went Wrong on Lending
The worst of the economic crisis may be far from over. That was the message of Federal Reserve Chairman Ben Bernanke Tuesday. He indicated that the housing and financial turmoil will persist deep into next year. The Senate, meanwhile, is deliberating a bill this week that would provide government-backed loans to 400,000 homeowners on the brink of foreclosure. We speak with former investment banker turned journalist and author, Nomi Prins, about “Why the Economy Went South.”

April 10, 2008: Report: 40 Years After King, Little Progress in Closing Economic Inequality Gap Between African Americans and Whites
In the late 1960s, Dr. Martin Luther King recognized that the next phase in the quest for civil rights and equality would focus on the economic divide. A new report from the Institute for Policy Studies titled “40 Years Later: The Unrealized American Dream” lays out key elements of the inequality that African Americans still experience in the United States around education, employment and wealth accumulation. We speak with the co-author of the report, Dedrick Muhammad.

March 31, 2008: Loretta Napoleoni on “Rogue Economics: Capitalism’s New Reality”
Italian economist, journalist and author Loretta Napoleoni argues that recent events on Wall Street indicate a much larger upheaval and could “signal the end of the ‘Roaring Nineties,’ nearly two decades of easy money, cheap credit, and soaring global debt.” It’s an argument Napoleoni develops in her latest book called Rogue Economics: Capitalism’s New Reality.

March 26, 2008: Homeowners Plan Demonstration at NYC Offices of Bear Stearns, JPMorgan Chase to Protest Government Bailout
Hundreds of homeowners are planning a demonstration today in Manhattan in front of the corporate offices of Bear Stearns and JPMorgan Chase to protest the “taxpayer bailout…and refusal of the government and Federal Reserve to provide real solutions for the millions of homeowners at risk of foreclosure.” We speak with Bruce Marks, the founder of the Neighborhood Assistance Corporation of America that is organizing the demonstration.

March 20, 2008: Fed Bailout of Bear Stearns First of its Kind Since Great Depression
The nation’s fifth largest investment bank Bear Stearns nearly collapsed last week. It was saved only after the Federal Reserve took extraordinary measures to help JPMorgan purchase the eighty-five-year-old firm. The Fed has become the lender of last resort for other investment banks in a move that marks one of the broadest expansions of the Fed’s lending authority since the 1930s. We speak with Nomi Prins, an author and former investment banker at Bear Stearns, and Max Fraad Wolff, an economist and writer.

February 08, 2008: Examining Clinton & Obama’s Stances on the Subprime Mortgage Crisis, Universal Healthcare, Privatizing Social Security and Nuclear Energy
With Senators Hillary Clinton and Barack Obama in a dead heat, we look at their stances on some of the most pressing domestic issues with Robert Kuttner of the American Prospect, Max Fraser of The Nation and Paul Gunter of Beyond Nuclear.

January 29, 2008: Kathleen Newman & Barbara Ehrenreich: Bush Has Ignored the Working Poor and Failed to Address Growing Economic Inequality
During last night’s State of the Union, President Bush pushed for Congress to approve a $150 billion economic stimulus. Newman and Ehrenreich examine how Bush’s plan fails to help most homeowners facing foreclosures and fails to expand benefits for the poor such as unemployment insurance or food stamp allotment.

January 23, 2008: Economics Journalist Robert Kuttner on the ‘Most Serious Financial Crisis Since the Great Depression’: ‘This is the Result of Right-Wing Ideology and the Political Power of Wall Street’
Amid growing fears of a worldwide recession, the Federal Reserve slashed a key interest rate by three quarters of a percentage point on Tuesday, the biggest single cut in nearly a quarter of a century. Meanwhile, President Bush and Congressional leaders pledged to work together on a stimulus measure that would inject about $150 billion dollars in additional money into the economy. But many economists are skeptical over whether any measures can turn around a severe slump in the housing market and the subprime mortgage crisis, signs of growing unemployment and weakening consumer spending and the added blow of record high oil prices.

January 18, 2008: ‘Free Lunch: How The Wealthiest Americans Enrich Themselves At Government Expense (And Stick You With the Bill)’
Pulitzer Prize winning journalist David Cay Johnston joins us to talk about his new book, “Free Lunch: How The Wealthiest Americans Enrich Themselves At Government Expense (And Stick You With the Bill).” Johnston reveals how government subsidies and new regulations have quietly funneled money from the poor and the middle class to the rich and politically connected.

January 17, 2008: Report: Subprime Mortgage Crisis Causing African-Americans to Experience Greatest Loss of Wealth in Modern U.S. History
A startling new report has predicted the subprime mortgage crisis will cause people of color to lose up to two hundred thirteen billion dollars leading to the greatest loss of wealth in modern U.S. history. The figure appears in a new report from United For a Fair Economy called “Foreclosed: The State of the Dream 2008.” The group accuses mortgage lenders of deliberately targeting the poor and people of color with high-cost loans.

January 02, 2008: Community Activists in Des Moines Speak Out on Thursday’s Iowa Caucus
Hugh Espey and Robin Ghormley of the Citizens for Community Improvement and Deepak Bhargava, executive director of Center for Community Change, discuss Thursday’s caucus.

December 10, 2007: ‘Bush Offers an Umbrella When We Need a Tent’–Jesse Jackson Says President’s Plan to Prevent Foreclosures Doesn’t Go Far Enough
President Bush announced a plan last week to freeze interest rates for some homeowners facing foreclosure. But critics say the plan’s strict guidelines will leave out the most vulnerable. We speak with the Rev. Jesse Jackson

November 29, 2007: Abu Dhabi Becomes Largest Citigroup Shareholder with $7.5B Investment, Bailout Comes Amidst Subprime Mortgage Crisis, Record-High Oil Prices
The Gulf Arab emirate of Abu Dhabi bought a $7.5 billion stake in Citigroup, America’s largest bank, on Tuesday, making it the bank’s largest shareholder. As the U.S. credit crisis worsens and the price of oil hovers close to $100 a barrel, the injection of capital from oil-rich Gulf states is seen as a bailout of banks in trouble.

November 29, 2007: Minorities Hit Hardest by Subprime Mortgage Crisis
We take a look at how the subprime mortgage crisis is affecting homeowners. The latest statistics show U.S. foreclosure filings nearly doubled in October from the same month last year. African American and Latino homeowners have been particularly hard hit.

April 04, 2007: Subprime Lending Crisis: Millions of Families Face Losing Their Homes to Foreclosure
Subprime loans have led to one million American families losing their homes in the past decade, a new study by the Center for Responsible Lending has found. In the last ten years, the subprime loan industry has emerged as a major, and controversial, player in the housing market.