Fannie and Freddie did not cause the subprime lending explosion

Evidence

Fannie and Freddie had nothing to do with the explosion of high-risk lending a few years ago, an explosion that dwarfed the S&L fiasco. In fact, Fannie and Freddie, after growing rapidly in the 1990s, largely faded from the scene during the height of the housing bubble. Partly that’s because regulators, responding to accounting scandals at the companies, placed temporary restraints on both Freddie and Fannie that curtailed their lending just as housing prices were really taking off. Also, they didn’t do any subprime lending, because they can’t. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 878

Categorization

• XREF: Directly refutes the standard conservative/neoliberal causal narrative; connects to the debt-economy critiques in other financial crisis literature. — connects to: The Community Reinvestment Act did not cause the US housing bubble — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 883; Fannie and Freddie cannot plausibly explain a multi-state global crisis — Mark Blyth, Austerity: The History of a Dangerous…, 726; The housing bubble traces to private securitization, not government GSE lending — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 888 (+3 more)
• QUESTION: Worth chasing: what specifically prevented Fannie/Freddie from subprime lending, and what was the regulatory-history detail about the accounting-scandal restraints?

Broader Connections

• Fannie and Freddie cannot plausibly explain a multi-state global crisis #corroborates (0.90) — Mark Blyth, Austerity, 726
• The housing bubble traces to private securitization, not government GSE lending #corroborates (0.90) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 888
• The Community Reinvestment Act did not cause the US housing bubble #corroborates (0.85) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 883
• Unregulated banks, not subprime borrowers, drove the global financial crisis. #corroborates (0.85) — Albert Bandura, Moral Disengagement, 1521
• Government-backed loan guarantees without oversight enabled predatory lending #contradicts (0.80) — Albert Bandura, Moral Disengagement, 1487
• Loan securitization concentrated risk rather than eliminating it. #expands (0.75) — Mark Blyth, Austerity, 80