Barry, I appreciate your comments but feel you have perhaps missed the point. I clearly state that CRA in and of itself was not the problem but the bastardization of said act is without a doubt one of the root causes for this crisis. The Clinton admin. in 1995 – 96 at the direction of Robert Rubin made a number of rule changes that when used in conjunction with CRA forced banks to loan money to people who clearly could not afford the loan. Wall st. products exaserbated the problem with FNM and FRE leading the way and the rest is history.

The CRA told banks that if they opened a bank branch in Harlem, then they could not suck up all the local business and residents’ cash deposits, then turn around and only lend it to Tribeca condo buyers. Banks were under no obligation to open Harlem branches, but if they did, they were required to at least try to lend the locals back some of their own money. No quotas, minimums or mandates – just a good faith attempt to make loans.

Those who insist the CRA was to blame for the current crisis have a hard time explaining some obvious logical flaws. Why was there no credit/housing meltdown from 1977 to 2005? The CRA critics never seem to address this question. Why did dozens of other countries from the United Kingdom to much of Europe to New Zealand and Australia – none of which have are covered by American laws such as the CRA – have a remarkably similar housing boom and bust to the USA? The pundits fail to account for that. Interesting that this legislation somehow manages to transcend both time and space.