"Lenders were 3-1/2 times more likely to steer blacks to high-interest mortgages than whites with comparable credit scores, according to a Center for Responsible Lending study of 27 million loans originated from 2004 to 2008. In Memphis, where 63 percent of the 652,000 residents are black, officials say their city was targeted for such predatory lending -- a practice that Marano says his company didn't engage in...." ("Wall Street Kept Winning on Mortgages Upending Homeowners," Bloomberg)
How do you like them apples? The people who run the big banks are such dispicable dirtbags they're already figuring how they can fleece some of the country's most vulnerable groups. And Bernanke's on board with the whole stinking swindle.
So, here's what to look for: Bernanke is going to use the Fed's bully pulpit to coerce the Consumer Financial Protection Bureau (CFPB) to define a "qualified mortgage" in a way that allows the banks to dump their garbage loans on Uncle Sam without any risk to themselves. That's what this charade is really all about; the banks want a "safe harbor" provision in upcoming regulations that will exempt them from having to buy back the mortgages that were proferred to people who cannot repay the loan.
In other words, the banks want to use Bernanke's $40 billion per month giveaway (QE3) to create an entire constelation of toxic mortgage-backed securities (MBS) for which they will have zero liability.
The CFPB will decide the matter sometime in January 2013. Bernanke's plan to reflate the housing bubble and turbo-charge salaries and bouses at the big Wall Street banks depends largely on the agency's definition of "qualified mortgage."
Absent looser lending standards, housing prices will probably decline sometime in late 2013. But that's just a guess.