Originally Posted by KC native
Why? Why should the GSEs, which are profit seeking corporations, be held to a different standard?
Because that is the expectation of a GSE. Otherwise they would be purely private. It's part of the implicit arrangement with the government.
Regarding the post prior to this... it isn't just a random "financial scandal." They are being sued specifically for distorting their figures on subprime. We know they lied we just don't know to what extent.. and for how long. We probably will never get the entire truth.
You are correct that their motivation was profits not the CRA. The CRA stuff is a red herring. I just haven't seen any convincing evidence otherwise. I can see how the THEORY that the CRA would be at fault could be true... but the numbers and reality just don't seem to support that. One thing though, there WAS a lot of talk about the CRA and using it as an EXCUSE for bad behavior. That doesn't make it a cause.. it just distorted the issue and was a way to get certain politicians to sign off on Fannie and Freddie's bad behavior and even was used to placate people regarding GLB. (This goes back all the way to the early 90s)