We all know risky and greedy bankers were the culprit in the housing market crash over the past few years. We have been told they are the ones to blame. However, they are not the only ones.

Take a look at the following Letter To Bush, from back in 2004, from members of Congress.

What I find really interesting is the stance that Barney Frank, Nancy Pelosi, Maxine Waters, Charles Rangel and company (you can see the full, signed list) were concerned that the Bush Administration was more concerned about “safety and soundness…at the expense of affordable housing.”

In other words, the people in Congress did not like seeing easy home ownership practices scrutinized.

Take a look at the following letter and see who else is to blame for creating the housing bubble leading to the financial crisis for the last few years.

About a week and a half ago, Friday the 25th I believe or Saturday, I was listening to Barney Frank give some quick responses to a Q&A session on the steps in Washington regarding recent financial legislation.

A couple comments Mr. Frank made referenced banks which would require them to hold more loans versus selling them on the secondary market. Another topic referred to YSP and mortgage brokers.

I’ll leave the second topic to be discussed in the chapter “The Banker’s Secret” in my book, “Barking With The Big Dogs”, but for now, let’s see if the new legislation is really good for you and me and America as a whole.

When I heard his comments, I immediately thought the comments are good talking points, but more to the story exists which probably won’t be heard on CNN or Fox.

So, here is my take on just parts of the recent financial overhaul.

The new recent proposed legislation requires banks to hold more cash on hand, and is not a bad idea. However, new changes may require banks to hold more mortgages too thus affecting the transfer of loans to the secondary market. (The secondary market is where mortgages are in investments such as mutual funds for example which the Average Joe may own.)

The secondary market helps the big banks and small banks and individuals too regarding the flow of money and money earned. However, small and regional banks may not have the ability to sell as many loans or do as much business, thus potentially hurting the local banking community.

If banking laws require lenders to hold loans and keep larger deposits, the changes could be a huge benefit to the largest banks since smaller institutions may not have the balance sheet requirements to compete. Holding loans also reduces liquidity, the free flow of markets and the ability to loan money to more people can diminish.

While driving to work yesterday and enjoying the nice spring morning, I was channel surfing the radio and landed on NPR. The topic on the radio had commentaries about health care reform.

One of the key comments made had to do with limiting excess profits. The idea is for companies to make enough profits to pay claims, doctors, etc., but eliminate excess profits.

What a sinking feeling.

No, I’m not talking about reducing my health care cost, which would be nice (but not likely even after reform). In reality, we will pay in some shape, form or fashion for this reform – both monetarily and our in our freedoms – of choice and time for example. Instead, what I’m referring to are things like mutual funds, exchange traded funds, retirement accounts, insurance policies, etc.

That’s right, these excess profits go to shareholders, such as you and me, not just the demonized Wall Street suits we only hear about. Why invest our money if we won’t get a return on our money?

How do insurance companies pay for life insurance for example? The companies use money to make profits to pay the policies. Have you ever looked at a prospectus to see where the money goes and which companies are invested in?

Yes, Obama has made it clear he does not like profits (for everyone else in my opinion). However, he made $5.5 million last year. Obama has mentioned, there is a time for profit, but it is not now. That’s just plain wrong – there is always a time to profit. As well, he has labeled bankers as fat cats, yet has not reduced earmarks for pork projects.

Barney Frank made comments about eliminating profits going to shareholders as well.

The ironic thing about socialism and capitalism is that the Socialist are Capitalist themselves.

The elites, who put their pants on one leg at a time just like the average Joe, are really capitalizing by taking from everyone else. Therefore, capitalism works, socialism doesn’t. And why should one man or a small group of people determine what everyone else makes – or limit individual potential?

To finish, I saw a bumper sticker that read “I’ll keep my guns, money and freedom…You keep the change”. When all of the new changes that have been occurring over the last year and in the years to come, I hope we are not simply left with pocket change.