1 reply to this topic

[stocks]

Redlining is the practice of denying or increasing the cost of services, such as banking, insurance, access to jobs,[1] access to health care,[2] or even supermarkets[3] to residents in certain, often racially determined,[4] areas. The most devastating form of redlining, and the most common use of the term, refers to mortgage discrimination. The term "redlining" was coined in the late 1960s by community activists in Chicago. It describes the practice of marking a red line on a map to delineate the area where banks would not invest. During the heyday of redlining these areas were most frequently minority inner city neighborhoods.

http://en.wikipedia.org/wiki/Redlining


ARTICLE FROM 1998:

Analysts worry that banks are too quick to give credit where credit isn't due ... and will pay the price during the next recession.

The easy flow of credit during the 1990s has helped to fuel a nationwide housing boom and spending spree that has kept the economy humming. But analysts say banks have lowered their lending standards, particularly to tap into the fast-growing minority markets, and have been under strong political pressure to do so despite studies showing minorities are more likely to default than whites. The result of this largess may be soaring levels of bankruptcy and default during the next recession.

"We have created a tremendous amount of risk," says Cynthia Latta, economist with DRI/McGraw-Hill in Boston. "At some point, the economy is going to turn down. There will be large numbers of defaults that will trigger a lot of political heat."

http://findarticles...._15/ai_57748148

[stocks]

Remember Jimmy Stewart in "It's A Wonderful Life" making all those subprime loans?