What Happened And Why It Will Happen Again

[4-2-7]

Originally Posted by Pukka Sahib

The issue is not so much one of political partisanship as it is the lack of political will. Other than Senator Elizabeth Warren, there doesn’t seem to be anyone in the government with the guts to stand up to the bankers. In this, I fault President Obama's leadership; for although he did not create the problem, he failed to take decisive action to correct it. When he had the bankers by the balls and called them on the carpet at the White House, instead of bringing these rogues to heel, he let them off the leash. The gleeful bankers held a press conference to announce that the President had agreed to "work with them". Dodd-Frank was too little to late; and it was immediately attacked by the banking and Wall Street lobbyists that have succeeded in getting the few restrictions on trading financial derivative contracts "relaxed" to the point that it is back to "business as usual". You can rest assured that what happened before will happen again - and soon. And you and I - and everyone not responsible - will end up paying for it; and for a very, very long time to come.

I guess you didn't read what I posted.

[bobabode]

Time for some Dylan.

[4-2-7]

Originally Posted by bobabode

Time for some Dylan.

I just got back from the record store with a fat stack. I don't know what I'll be putting on first.

Which Dylan are you going to spin?

[BlueStreak]

Originally Posted by 4-2-7

I guess you didn't read what I posted.

He probably doesn't care. Like the rest of us.

Dave

[Boreas]

Originally Posted by 4-2-7

I guess you didn't read what I posted.

[bobabode]

Originally Posted by Pukka Sahib

You're right, the President cannot make "sweeping reforms" - but he could have made it happen. What President Obama didn't do (and what he should have done) was to put every member bank into federal receivership until Congress enacted effective remedial legislation eliminating proprietary trading by bank entities, both directly and indirectly through their parent holding companies. There would be no more gambling on the taxpayer's account, and no more executive bonuses. Then we'd have a whole new banking system.

I like the way you think but holy mackeral, man!

The hue and cry would've been enormous over the fatted calf being gored through and through. Naturally, I would've danced with glee until the House and Senate impeached the man with the Supremes singing back up.
As to the original post, I'm afraid you're right. The fox is in the henhouse and we're headed for another fleecing.

Sorry for the mixed metaphor, I blame the Irish Car Bomb that I had earlier. ; )

[mpholland]

Originally Posted by bobabode

I like the way you think but holy mackeral, man!

The hue and cry would've been enormous over the fatted calf being gored through and through. Naturally, I would've danced with glee until the House and Senate impeached the man with the Supremes singing back up.
As to the original post, I'm afraid you're right. The fox is in the henhouse and we're headed for another fleecing.

Sorry for the mixed metaphor, I blame the Irish Car Bomb that I had earlier. ; )

So things should just stay business as usual? Someone has to yank on the leash, and O was in the best spot to do it that I can remember in recent history. Yes, there might have been a lot of political and corporate crying, but who gives a shit! They've been making me cry for years.

[bobabode]

Originally Posted by mpholland

So things should just stay business as usual? Someone has to yank on the leash, and O was in the best spot to do it that I can remember in recent history. Yes, there might have been a lot of political and corporate crying, but who gives a shit! They've been making me cry for years.

Hell, no. Personally, I would like to see Sen. Liz with her foot buried knee deep up the banking industry's ass while their necks were lashed to the yoke and Bernie Saunders whip in hand driving them.

I just doubt that Obama could've made a unilateral decision of that magnitude that would have stuck. Pick your battles wisely, as they say.

[4-2-7]

Originally Posted by Pukka Sahib

You're right, the President cannot make "sweeping reforms" - but he could have made it happen. What President Obama didn't do (and what he should have done) was to put every member bank into federal receivership until Congress enacted effective remedial legislation eliminating proprietary trading by bank entities, both directly and indirectly through their parent holding companies. There would be no more gambling on the taxpayer's account, and no more executive bonuses. Then we'd have a whole new banking system.

Are you suggesting Nationalizing the banks?

[mpholland]

Originally Posted by Pukka Sahib

Not all of the homeowners caught up in the subprime mortgage debacle would deserve to be “bailed out”; and many, many of them went bankrupt. For example: a man who worked as a janitor for the school district, and never earned more than $35,000.00 per year in his life, managed to buy four homes in California by borrowing more than $2,000,000.00 in subprime loans. On his loan applications (prepared by his loan broker) he stated under penalty of perjury that he owned a janitorial service business and earned over $300,000.00 a year. The homes were purchased as "owner occupied" with 100% financing on adjustable rate notes secured by the property whose value was overstated by inflated appraisals made by the partner of the loan broker; and the mortgages were packaged and sold by the banks as debt securities on the financial markets.

Then when the interest rate on the adjustable mortgages went up and the property values went down, the hapless janitor was facing payments three to four times the amount he earned each month or could collect from renters of the properties; and he defaulted on the note obligations secured by the mortgages that were subsequently foreclosed, some by the lending banks that were obligated to buy back the paper pursuant to repurchase agreements, and others by assignees of the mortgage-backed securities. The "millionaire" janitor, who filed bankruptcy, was an uneducated immigrant from Mexico and claimed that he did not understand the loan documents prepared for his purchase of the four properties; the loan broker claimed that he prepared the applications based on what the borrower told him; and the banks admitted that there was no "due diligence" inquiry as to either the value of the collateral or the borrower’s financial ability to make the payments. One bank officer stated in his FDIC deposition: "He looked pretty good on paper."

And, this was not an isolated case - it was rampant. There was a record number of foreclosures on subprime loans secured by overvalued property on credit bids by the holders of the mortgages. The government regulatory agencies did not exercise proper oversight of mortgage bankers and financial markets; and bailing out the borrowers would only have rewarded the banks for making bad loans.

I still marvel at how that took place. I bought my house right before the downturn and every little morsel that I put down on paper was questioned, verified, and double checked before I was even pre-approved. Had to go through a more thorough process than that for final approval. All this on top of the fact that I had good credit, good debt:income, stable job history, and money in the bank. Guess I sought money from the wrong place, are the right place as shown in the long run.