Bob Corker: “I would like to go back and say we began the process of looking at financial regulation after the crisis that occurred a…”

“I would like to go back and say we began the process of looking at financial regulation after the crisis that occurred a couple years ago, where institutions all across this country made loans--very poor loans--to people who used that money to buy homes. That was the genesis of this crisis, the fact that institutions across this country made those bad loans and made them to people who could not pay them back. Certainly, that was exacerbated by the fact, with all the easy credit that occurred, there was a housing bubble that no doubt was going to put housing back into its normal state at some point. The combination of those two factors created a tremendous crisis in our country. When the banks involved in all these loans got into trouble, there was not a good mechanism to deal with so many of them being in trouble at the same time. We ended up with a moral hazard with which this legislation is trying to deal; that is, we had institutions around this country that had capital injected into them because many people at that time felt the Bankruptcy Code or other mechanisms were not there to deal with these institutions.”