Who And What Caused The Financial Market Collapse

[trying2win]

I thought this was an excellent column by Eric Margolis on this topic:

http://www.ericmargolis.com/political_commentaries/obamas-cure-may-be-worse-than-the-ailment.aspx

I'm not a fan of Premier Vladimir Putin of Russia, but I thought he was right on in his criticism about the USA for allowing the Wall Street shenanigans to happen to cause such a global finacial crisis. I guess it would have been more correct to say that the USA government was the guilty one here, not the USA.

I also liked the comments of the columinist, Eric Margolis in blaming the G.W. Bush administration for causing the global financial crisis. Also, I thought these addtional comments from this column by Eric Margolis were right on as well:

"While aiding the financial system, the government should investigate all the bankers, realtors, money managers and financial alchemists who created America’s bubble economy of debt. Fraudster Bernie Madoff was not alone. Time for handcuffs, not golden handshakes."

Like many other investors in the stock market who played by the rules over the years, I got burnt to the tune of many thousands of dollars in my retirement accounts. But thanks to the negligent, greedy, sleazy, #%&@$ tactics of the guilty parties mentioned in the underlined paragraph above, it'll take many years for my retirement account to regain the heavy losses. And at my age (almost a senior), I don't know how many years that'll take. I'm sure many PA members have lost many thousands of dollars in their retirement and/or stock market investments as well.

So to sum up (and I've said if before)....Where's the accountablity of many of the major shady characters guilty of the financial market meltdown?. I want justice to done. Reprimands, public humiliation, stiff fines, jail time, repayment of obscene salary and perks by sleazy Wall Street banks to be paid to at least the U.S. treasury. Let's get something done in these areas President Obama. And stiffer U.S. Government regulation in the stock market and Wall Street banking policies. If that would be done, if would give more confidence for ordinary investors to once again put money in their retirement accounts and/or invest in the stock market.

And more thing President Obama. It was nice to see you limiting the salaries of Wall Street executive bankers to a maximum of $500000 per year. But....I was disappointed you wimped out on one thing...you didn't make that order retroactive to the other Wall Street bankers whose companies got U.S. Federal Government bailouts earlier.

Canada has had very stringent regulation policies in place in many banking policies ever since the PRINCIPAL TRUST fiasco of many years ago. Many Canadians can probably still remember that scandal. Ever since that time, if a Canadian wanted to borrow money, you practically had to prove to a bank that you didn't need the money in the first place, if you had plenty of collateral, job security, low or no debt totals etc.

Has anyone heard any investigations of pending prosecutions of any of the sleazy infividuals involved in the financail market meltdown? That is anyone from the U.S. Federal Government who were trying to influence Wall Street banks to loosen their lending practices to home buyers etc. to the shady, greedy Wall Street bankers themselves?

T2W

-------------------------------------------
~"We must reject the idea that every time a law's broken, society is guilty rather than the lawbreaker. It is time to restore the American precept that each individual is accountable for his actions."

--Ronald Reagan

[Lefty]

Only a liberal would be thrilled with limiting salaries in the private sector.
Seems like the economy was going along pretty good until the last 2 yrs. Guess who controlled Congress the last 2 years? go ahead, guess.

[Dinsdale Piranha]

I blame Jimmy Carter.

[dav4463]

Who? Democrats.

What? Giving loans to those that cannot afford to pay them back due to mandating that those less fortunate should be able to have what others have even though they cannot afford it.

[trying2win]

I blame Jimmy Carter.

Dinsdale:

I couldn't figure out why you would blame Jimmy Carter, but after reading another interesting article online regarding the economic collapse, I think now that you may be on to something.

It was interesting to read in the article below, the writer's list of sleazy, money-grubbing politicians and their games of smoke and mirrors. It appears these greedy characters had a vested interest in keeping the gravy train coming in. Then we all saw the eventual economic meltdown as part of these shady, economic games being played in Washington D.C and Wall Street.

The writer seemed kind of cynical that the FBI investigation into the economic collapse would continue, if Barack Obama was elected president. I hope the writer was wrong, and that the FBI will continue to investigate the dealings of all the shady characters listed in his article, and perhaps some other guilty low lifes involved in these greedy, unethical schemes.

Anyway, here is the article from October 2008:


http://myrightwingdad.blogspot.com/2008/10/fw-economic-collapse-from-san-francisco.html

T2W

[Judicious Player]

Only a liberal would be thrilled with limiting salaries in the private sector.
Seems like the economy was going along pretty good until the last 2 yrs. Guess who controlled Congress the last 2 years? go ahead, guess.

That is an unrealistic observation. Who controlled Congress the 6 years before that? A bad ecomony gets that way the way a pot of water comes to a full boil. Slowly. Not overnight.

[HUSKER55]

depends on when the heat is turned up

[ddog]

well in the water analogy it's actually when the water boils away.

not when the heat is turned up.

[boxcar]

Who? Democrats.

What? Giving loans to those that cannot afford to pay them back due to mandating that those less fortunate should be able to have what others have even though they cannot afford it.

Yeah...I caught the remarks of some government NutJob official on Rush's show yesterday that actually defended this practice! In fact, he said it was a good idea at the time! In other words to ensure that virtually every poor person in the country gets a house to live in, it's perfectly okay to turn the entire banking system and traditional, proven loan policies on its ear. It's perfectly fine to turn the entire system inside out -- so that the poooor, the underclass, the underprivileged can get their piece of the American pie -- even though they don't have a pot to piss in!

Boxcar

[Tom]

Only a liberal would be thrilled with limiting salaries in the private sector.
Seems like the economy was going along pretty good until the last 2 yrs. Guess who controlled Congress the last 2 years? go ahead, guess.

The old question....are you better off or worse off than 8 years ago?
Well, it must be revised to 6 years. After 6 years of Bush, I was financially far better off than in 2000. And we, as a nation were safer.

After two years of dems, and a month of Obama, I am about 40% financially what I was, far worse off than in 2000 and we are now open to more terror attacks. My only hope is that Al Qeda follows their MO - after a failure, they keep trying until they succeed. They tried to hit DC and failed....

So, my question is, with most of my retirement stolen from me, no time to recoup, freeloading being rewarded and encouraged everywhere, what is my incentive to keep working? Take health care out of my benefits and I would a fool not to just stop and leech off the Obama National Teet. And I am not alone. Why should I work when those who don't and those who fail, and those who cheat just keep getting rewarded? Why should I be the sucker?

[delayjf]

I also liked the comments of the columinist, Eric Margolis in blaming the G.W. Bush administration for causing the global financial crisis.

He refers to Bush not telling the truth - but give no specifics as to how the economy is Bush's fault. Did I miss something.

[Lefty]

Obama was a senator and voted for many of the policies that caused the collapse. These dims have nothing but to blame everyone else for their failures. He'll still be blaming Bush when he's running for a 2nd term.
BTW, he's third on the list of getting big bucks from Fannie Mae and Freddy Mac. He said he inherited the deficit when he helped contribute to it and his answer is to add trillions to it?
He is using this crisis to fulfil the socialist dreams that dims have held for many many years.

[LottaKash]

The Banks, The Dems, The Repubs, they are all the same guys......What part of scammed, are some of you folks not getting ??....

The things they are doing to us these days, and I may add with impunity, border on treason, at least as I understand the constitution, and the fore-warnings of our nation's founding fathers...

Yet, many of you go on and on, finger pointing and calling each other's political party names, while they laugh at us, thinking this is right where we want them to be...

I don't have the answer(s), but I sur would like to see a new direction for this country to take, and soon......

best,

[Lefty]

A month or so ago Rahm Emmanual said that this crisis is too good to let go to waste. Well he and Obama is using it to the fullest to scare the bejeezus out of us. He outright lies when he says this is the worst economic crisis since the Depression. Wrong. It's the worst since the Carter Recession and not yet as bad as the Carter Recession. Unemployment then was a tad over 10%. Interest rates were up to 19 and 20%. Inflation was paramount.
Reagan came along, cut taxes, talked about hope and prosparity not doom and gloom and we had yrs and yrs of ecomomic good times. Dims know that tax cuts work, but that doesn't fit their agenda of getting us dependent on big govt. Those people at the townhall in Fl were ac perfect example. They wanted the govt to give them things. That's the dim voters and they hope to make us all like that. Begging the govt to make our lives better.

[Tom]

Yes, Lefty, yes. Politics of fear. He is the opposite of Regan. The analogies to FDR are wrong because this is nothing like what FDR faced......we were not 10 trillion in the hole back then, we had a large manufacturing base to rely on when needed, and when the war came ( anyone guessing FDR knew about Pearl Harbor and allowed it to happen because his NEW Deal was failing?) American workers,not freeloaders, stepped up and manufactured our way into prosperity. No hope, no change, just sweat and dedication, and jobs.

Obama is seriously misguided and going the wrong way. He is a larger threat to this nation than Hitler or the Emperor ever were. This is the Anti Christ, walking, talking, jiving, lying.

[jballscalls]

. He is a larger threat to this nation than Hitler or the Emperor ever were. This is the Anti Christ, walking, talking, jiving, lying.

Oddly enough i'm reading a book my liberal buddy is making me read called "The end of America" which basically talks about how GWB is a fascist,totalatiarian leader and compares many things in his presidency to Stalin, Hitler and Mussolini.

It's been kind of a boring book so far, just kind of making random comparisons between bushy and those guys.

[BlueShoe]

And why?To answer that would have to type for a very long time,and the post would be too long to read,so will just let the rest of you guys comment,a few of you have got it right.The real question is who is the nation going to blame when the solution turns out to be much worse than the problem,as it most certainly will be?That is easy to answer;it will be Comrade Obama and his Bolshevik advisors and appointees.Never in history has a nation been able to inflate their way to prosperity by turning on the printing presses,and no nation ever will.The Keynesian/Marxrist mindset has never been able to grasp this point of history and/or basic economics,so hang on,we still have a bumpy ride ahead of us,perhaps for a long time.

[LottaKash]

"The end of America" which basically talks about how GWB is a fascist,totalatiarian leader and compares many things in his presidency to Stalin, Hitler and Mussolini.

Also, he is a member of the "skull and bones' and the "knights of Malta".....and for those of you who are unaware of these clandestines organizations, hell-bent on a "new world order"....you can always look it up......

best,

[Marshall Bennett]

Oddly enough i'm reading a book my liberal buddy is making me read called "The end of America" which basically talks about how GWB is a fascist,totalatiarian leader and compares many things in his presidency to Stalin, Hitler and Mussolini.


Enjoy !! Fairy tales can be a nice change of pace .

[Tom]

Yes, he was working to create the NA Union and he willingly refused to protect our borders and allowed to innocent border guards to go to jail.
I have no doubt he will burn in Hell for that. That is his problem and I won't lose any sleep over it. I give him credit where it is due, but he also has take blame where it is due.

[BlueShoe]

"Skull and Bones" and "The Knights of Malta"?How about the Council on Foreign Relations,the most dangerous of all,which has been the shadow government of this nation for decades?Both Obama and McCain are members,as are both Bush senior and junior.Sorry to say,but many professed Conservatives such as the late William F. Buckley,Dick Cheney,and Newt Gingrich are members.

[Greyfox]

A "ME FIRST" credit card generation caused the financial collapse. No one wanted to wait until they could afford to buy something. It had to be bought now.

Check out this 15 year old cartoon that is circulating on the net at

http://2.bp.blogspot.com/_djgssszshgM/SYXCzpR0MbI/AAAAAAAAAyY/VYle3udsueo/s1600-h/CalvinHobbs.BMP

[Lefty]

kash, blue, you boys left out he was also in cahoots with the aliens...

[LottaKash]

"Skull and Bones" and "The Knights of Malta"?How about the Council on Foreign Relations,the most dangerous of all,which has been the shadow government of this nation for decades?Both Obama and McCain are members,as are both Bush senior and junior.Sorry to say,but many professed Conservatives such as the late William F. Buckley,Dick Cheney,and Newt Gingrich are members.

YES, CFR, very scary bunch....and the conservatives that you mentioned, that belong to that group, gives them the balance that they need to do their chicanerous deeds and have some credibility when doing them.....

Dont't forget the "Rhodes Scholars", they are part of it, that is where they go for retraining, just check the list of who's who when it comes to Rhodes Scholars...WJ clinton.....for one....

best,

[Lefty]

Yeah, they're all out to get us. Scuse me guys but i got to go out and bag me a BigFoot.

[JustRalph]

Yeah, they're all out to get us. Scuse me guys but i got to go out and bag me a BigFoot.


Reminds me of my favorite Tabloid Headline

Bigfoot Stole my Wife!!!

[HUSKER55]

nice cartoon! :D :D :D

[The Judge]

the money. Why blame the victims? Those that can't pay their mortgages after they doubled because of bad terms lost their homes, downpayments, lost credit ratings,and may be looking for work.

Then there is Peter Kraus who worked at Merrill Lynch for less then 3 months and walked away with 24.9 MILLION in bonuses. Wife closed on a 36 million dollar hideawy. http://www.nydailynews.com/money/2009/02/11/2009-02-11_cuomo_reveals_4_top_merrill_lynch_execs_.html.

I know don't cap executive pay even in bankrupt companies but cut union contracts , a wage earner is making too much.

[Tom]

Victims?
Did they not know what they signed for a mortgage?
That is not a victim, that is a fool.

Did they not understand that they had to REPAY the loan?

[The Judge]

what they sign in a morgage,by the time you sign its close to the closing deadline you are signing mulitple documents about 3 inches thick. Its explained to you what you are signing. If you try to change anything it will put the closing back or kill the deal.

Again follow the money who has it and who doesn't. The lender is rich paying bonuses in the millions of dollars to new hires and the other is being put on the street unemployed. The guy put on the streert is the bad guy. I don't think so.

[JustRalph]

what they sign in a morgage,by the time you sign its close to the closing deadline you are signing mulitple documents about 3 inches thick. Its explained to you what you are signing. If you try to change anything it will put the closing back or kill the deal.

once again you remove the personal responsibility from the equation.

[Greyfox]

what they sign in a morgage,by the time you sign its close to the closing deadline you are signing mulitple documents about 3 inches thick. Its explained to you what you are signing. If you try to change anything it will put the closing back or kill the deal.

Again follow the money who has it and who doesn't. The lender is rich paying bonuses in the millions of dollars to new hires and the other is being put on the street unemployed. The guy put on the streert is the bad guy. I don't think so.

Tom is right. These people aren't victims. They are responsible for what they sign. I don't care if something is 10 inches thick. I'm responsible for understanding what I'm signing on to.

[Lefty]

Whenyou get a mortgage you are presented among the other papers a single piece of paper that you read and sign. It pretty much states that you know the terms of the mtg and that you are able to make the payments.

[The Judge]

they are responsible thats why they are on the streets and broke. You think the lenders appraiser (lenders agent, not buyers agent) who told these 1st time lambs...I mean informed real estate wheelers and dealers... that their tracked homes were worth $500,000 and raising could share in the blame.

Again follow the money, who is on the street looking for lodging and who is buying $36,000,000 N.Y apts. Looking for a culprit "Detective 101" who stands to benefit, who did benefit, follow the money and you will get your answer. Let me know if leads to the guy and his family, who are now living with relatives.

[ddog]

Tom is right. These people aren't victims. They are responsible for what they sign. I don't care if something is 10 inches thick. I'm responsible for understanding what I'm signing on to.



many many understood what they were signing, that's not it at all.

the system was a ponzi / fraud scheme that alll played in.

Those without a chair when the music stopped were/are/will be busted.

Simple.

[Greyfox]

many many understood what they were signing, that's not it at all.

the system was a ponzi / fraud scheme that alll played in.

Those without a chair when the music stopped were/are/will be busted.

Simple.

Good point. I agree on that. People are greedy and want to speculate. When the music stopped they were all staw buyers, but they knew what they were doing.

[fast4522]

The fact is we are to blame, we accept the concept of SSDD. And in turn we let our elected members of the Congress bow to big business when it screams it needs cheep labor. The amount of people coming into this country every year is twenty times what it was in the 70's, which fueled the housing bubble. There is no question they gave loans to people who could not afford the house they were buying. The same lines can be drawn to the health care system. These very same people in office today sitting as majority leaders of the party. Why would someone seeking a cabinet position in today's administration pay their taxes, people do what they do because they can. Every attempt will be made by those in power now to push everything euro like into law before the next two year elections in which the full House and possibly more that a third of the Senate faces the people at the election box. This is Teddy's last stand, Barney and the boys have control for the day. Can the people turn the tide and put these bums into the unemployment line like they did for us?

[ddog]

Good point. I agree on that. People are greedy and want to speculate. When the music stopped they were all staw buyers, but they knew what they were doing.


You BETCHA!!


that's why all this anguish and crying over the mtg/home markets and we have to prop it up and stop the prices from coming back to reasonable levels makes me want to pull out of this place sometimes.

It's just nuts.

save the ones who can be saved through loan mods,etc. but that is not done on the gvt dime.

if the guys that wrote the paper and the lenders and homeowners can't work it out then tough.
start over.

If the stupid gvt would calm down and give it some space it will settle.

[The Judge]

I have been saying this from day one re-write the loans for those that are still able to pay, don't double the monthly payment and force a foreclosure. Why is it that we see this but the monied people can't. It has been my exprience that they can see alot better then me when it comes to getting money.

So there most be more and/or faster money in foreclosures. They had to know the government would bail them out before hand. Who knew what and when did they know? I am conviced that someone will be going to jail on this.

[Floyd]

I have been saying this from day one re-write the loans for those that are still able to pay, don't double the monthly payment and force a foreclosure. Why is it that we see this but the monied people can't. It has been my exprience that they can see alot better then me when it comes to getting money.

So there most be more and/or faster money in foreclosures. They had to know the government would bail them out before hand. Who knew what and when did they know? I am conviced that someone will be going to jail on this.

It's not that there's more and /or faster money in foreclosures, it's that nobody knows exactly what the loans are worth.
Here's (http://www.dailykos.com/storyonly/2009/2/5/9358/44272/162/693426) a good explanation as to why the banks are reluctant to directly address this issue. They're hoping that us taxpayers will buy the bezzle.

[Tom]

I thought the banks were addressing it - they were foreclosing!
That is what they should do. The government is the one interfering and waffling. Look, I feel sorry for the hump who didn't read his loan agreement, but it is in no way MY responsibility to bail his ass out. I read mine, I paid mine. Suck to be lazy and ignorant, but they were and I wasn't.....not my problem.

[ddog]

I have been saying this from day one re-write the loans for those that are still able to pay, don't double the monthly payment and force a foreclosure. Why is it that we see this but the monied people can't. It has been my exprience that they can see alot better then me when it comes to getting money.

So there most be more and/or faster money in foreclosures. They had to know the government would bail them out before hand. Who knew what and when did they know? I am conviced that someone will be going to jail on this.

I talk with banks everyday and they are doing this, it's just that the fraud and scale are so huge you have to give it TIME to play out.

Lots of the banks still are needing to get a feel for what's coming.
Lots of banks are not stuck with tons of bad loans.

They were waiting and some still are a bit , to see/hope for some good signs.

THey need time to work it out while not destroying the businesses behind the loans as best they can.

Not all can be worked out, they have to be taken back, but that is a lot of the pickup in homes being moved now.

Look , just as one doesn't want to have zombie banks , one also doesn't want to have zombie homeowners either.

TIme Time it's not the end of the world, it's not a crisis , it is a problem and it is tough and lots do need help to work through it but it can be done.

IMO anyway.

[Floyd]

I thought the banks were addressing it - they were foreclosing!
That is what they should do. The government is the one interfering and waffling. Look, I feel sorry for the hump who didn't read his loan agreement, but it is in no way MY responsibility to bail his ass out. I read mine, I paid mine. Suck to be lazy and ignorant, but they were and I wasn't.....not my problem.

But that's the thing, they aren't forclosing as much as they normally would, and they aren't working with the borrowers to renegotiate the loans so they can stay in thier houses. If you have a borrower with a good job and enough income to pay a renegotiated mortgage, why wouldn't the bank renegotiate? Because the bank is carrying that mortgage at an inflated value. It's in the article I linked above.

"...according to the National Association of Consumer Bankruptcy Attorneys, fewer than ten percent of mortgage modifications in November reduced the principal. About half added late payments and penalties to the principal, and either increased monthly payments or added payments at the back end of the mortgage. If a borrower was in default already, what’s the chance the borrower can make a higher monthly payment?

Lenders are quick to say that they have every right to full payment, that they don’t have to agree to modify mortgages. ... But refusing to do what makes obvious economic sense is suspicious. If lenders agreed to modify a mortgage to reduce the principal, they would have to change how they value the mortgage as an asset. How do lenders value a modified mortgage that does not reduce the principal, but that is destined for default?

John Kenneth Galbraith wrote that embezzlement is "the most interesting of crimes" for an economist. Embezzlement is almost always eventually discovered, but for a time results in "a net increase in psychic wealth," when the embezzler "has his gain" and the victim doesn’t miss it. Galbraith called the undiscovered and therefore unfelt loss "the bezzle."

According to Krugman, the stock in banks that are solvent only by virtue of an "optimistic" valuation of their assets "isn’t totally worthless," but the stock’s value is "entirely based on the hope that shareholders will be rescued by a government bailout." The "huge gift to banks shareholders at taxpayer expense," Krugman said, was likely to be "disguised as ‘fair value’ purchases of toxic assets."

So maybe insolvent banks are stalling for time, hoping that the economy turns around, that home prices will go back up, or that sick borrowers will get well and unemployed borrowers will find jobs. Maybe they want to enjoy the "psychic wealth" of paper solvency for as long as possible.

And maybe they’re hoping we’ll buy their bezzle."

[ddog]

i wouldn't trust bkrpt atty with a vested interest in the game to be on the up and up.

Look, you don't have just two options , foreclose or cram down and take the hit right now.

It's way too simple.

it depends on exactly what they are talking about when they say "banks".

it takes time to get at this stuff, nobody was/is prepared for the amount of work that needs to be done to try to work this stuff down.

[delayjf]

many many understood what they were signing, that's not it at all.

the system was a ponzi / fraud scheme that alll played in.

Those without a chair when the music stopped were/are/will be busted.

Simple.

Agreed, I would like to see all the heads fall especially those at the top who walked away with the golden parachute - can somebody explain to me how Frank Raines was able to walk from Fannie Mae with 70 million dollars?

heard today that the FBI is going to start investigating some of these guys for fraud. Good.

[lamboguy]

i don;t know who, what or when this thing started. what i do know is we are in a heap of trouble, and we lack direction in how to get out of this mess!

[slewis]

I have been saying this from day one re-write the loans for those that are still able to pay, don't double the monthly payment and force a foreclosure. Why is it that we see this but the monied people can't. It has been my exprience that they can see alot better then me when it comes to getting money.

So there most be more and/or faster money in foreclosures. They had to know the government would bail them out before hand. Who knew what and when did they know? I am conviced that someone will be going to jail on this.


Easy your honor,

No one is going to jail....... the bankers CONTROL the politicians not visa versa.

Cant everyone see after the first TARP money went into the pockets of the guys who failed at their jobs (Thanks Hank Paulson) that we (the american people) have been had again. Explain how the govt fails to see the "fine print" in the 1st agreement, you know the one that controls compensation and bonuses.
I've stated in an earlier post back in Oct, the only way out of this was to let the real estate market crap out and uncle sam takes ownership (buys at REAL market value) of the forclosed propeties from the banks. In exchange, they also keep the banks solvent. Now they (the US govt) would have REAL assets.. it's own land, which can be sold when things turn.. at a good profit, instead of printing paper and mounds of debt.
By doing things the way they have chosen, they've artificially (tried to)propped up the current real estate market which might go through ANOTHER forclosure mania anyway if people keep losing jobs.... AND placed a huge debt on the heads of it's children not even born yet.
AND, that debt was sold primarily to China, so thats more wealth leaving the country and not helping it's citizens.
The world is having some laugh at us......