They should have had cram-down legislation.
The fact that they provided no genuine legal relief for the consumers means that corporate malfeasance was practically mandatory.
The problem with that statement is that the companies that purportedlby pushed fraudulent sub prime lending - the IndyMac’s, the WAMU’s, the Countrywides, are no longer. Instead you have banks that didn’t participate in the subprime craze - Chase (bought WAMU), B of A (bought Countrywide) trying to pick of the pieces and deal with the mess left behind. You’re wanting to punish the wrong people.
And of course, your statement ignores the role that home buyers played in this mess - no one held a gun to their heads making them taking a loan that they clearly could not afford.
No one held a gun to anyone’s head during this mess, but during the housing bubble lenders were telling people pretty much anything to convince them that yes, they could afford this home.
The problem may well be that the lenders originally writing the mortgages knew full well they had problems and deliberately didn’t do a proper paper trail in order to hide the problems. In other words, fraud.
First link I had handy:
http://www.truth-out.org/foreclosuregate63953
If true, all I can say to the banks is “sucks to be you.” Except for the part where it’ll be Joe Taxpayer that ends up paying for it all.
So, like, you shouldn’t buy ratbag banks at a firesale, because you might end up being liable for all their shittiness?
That’s a separate issue from what the previous poster was saying :)
Actually, the govt encouraged both of these purchases. The FDIC would have taken a much bigger hit if Chase had not taken over WAMU, and would you want a bankruptcy court/receiver trying to deal with the mess of Countrywide?
So people should believe whatever someone trying to sell them something tells them?
Psh I don’t really give a shit, but Chase/BoA shareholders sure do which is pretty much all that matters…Though if the system took a real haircut then maybe we’d have seen more consensus (or maybe better, passion, discipline, necessity, courage, creativity etc) driving reform.
Don’t attribute to malice what can more readily be attributed to incompetence.
Not saying they should have, but if multiple individuals who are supposedly experts in a field are telling you that of course you can afford a house and then some, it’s an easy trap to fall into. People often trust “experts” much too readily.
Anecdotally, I got a pre-approval during the easy housing fiasco for far more than what I could have afforded on my income and I told them they were nuts and explained why. Not everybody can do that.
As an aside, my doctor recently mentioned I’m suffering from a brain cloud and suggested I take a long vacation to a tropical island with Meg Ryan …
The entire financial crisis is such a gigantic clusterfuck I’m beginning to have a hard time believing anyone can be that incompetent and still remember to breathe.
This would be true in a perfect world, but in the land of people with steady long term (10+ years) jobs getting canned, and then not having enough to pay their loans. Even responsible people are getting screwed.
Of course, but that is why I prefaced it with “generally speaking” and the point of my reply wasn’t about foreclosures in general, but the notion from the quoted article that anyone who is in foreclosure is the victim.
Regarding the larger financial crisis, there is, without a doubt some malice. But you would be surprised with the level of “incompetence” in the decision making. And I lump greed and the pressure to realize the same profits as competitors driving decisions without properly assessing short and long term risk in there.
Just a difference in where we categorize stuff I think. “Fuck that paperwork trail noise - it costs money I’d rather pocket” goes in the malice bucket as far as I’m concerned. But I also buy that there was a bit of “let’s not tell the people we’re selling this shit to how bad it really is” in there, which is definitely malice.
Yeah, but that is different than “deliberately didn’t do a proper paper trail in order to hide the problems” (regarding the issue brought out in the article), i.e. “fraud”.
Incompetence would describe what the OP’s article is about.
Both true. The financial sector will be the first up against the wall when the revolution comes.*
The financial sector has basically ruined money.
So, the beauty of Hayek’s formation of connectionism as a precursor to graph theory was the optimizations that a price-setter would use to distill a single transmissabe value. The problem is that in an age of microsecond transactions, the entire basis of the theory is rendered obsolete, because it was formed in an age of informational scarcity. Seriously, you could run a stock ticker feed on a 60 hz modem.
I wonder with AG isn’t participating?
Regulators from all 50 states are launching a coordinated investigation into possibly “deceptive” and “unfair” foreclosure practices that may have illegally evicted families from their homes.
A bipartisan group of state attorneys general from 49 states and financial regulators from 39 states will work together to comb through foreclosure filings and documents from mortgage servicers to see if any state laws have been broken in the rush by services to kick borrowers out of their homes without following various state and local laws.