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August 23, 2013



Dick, in this latest article, you say, "the subprime mortgage mess was set into motion by the government with the 1994 National Homeownership Strategy." I'd submit to you that it (the mess) was triggered five years earlier, with the passage of the Banking Modernization Act of 1999, a.k.a. Gramm-Leach Bliley. This, of course essentially repealed Glass-Steagall. Following that, Sen. Gramm (R-TX) wrote and co-sponsored the Commodity Futures Modernization Act of 2000. This deregulated the trading of financial derivatives, like CDOs and Credit Default Swaps. While there were many components to the disaster, I believe these two were the sine qua non.

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