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Author Topic: How Bankers Screwed Americans W/A Pitchfork  (Read 3148 times)

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Offline MitchMiller

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How Bankers Screwed Americans W/A Pitchfork
« on: April 10, 2010, 04:51:25 PM »
I listened to part of the public radio American Experience show this morning that was pretty interesting for anyone that tracks the financial world.  I didn't see the segment posted yet on the PRI website, but the link here is the source of their report.
http://www.propublica.org/feature/all-the-magnetar-trade-how-one-hedge-fund-helped-keep-the-housing-bubble


This was truly amazing given the recent testimony by some financial gurus about how they just didn't see the housing bust (and associated financial products collapse) on the horizon.   Ira Glass, the American Experience moderator, made the whole point in his segment.  The bankers made these deals to collect the fees associated with them, knowing full well their potential impact.. then walked away, laughing all the way to the bank with their huge bonus checks (and probably a foreign bank at that!!!). 

Personally I put the blame on our poor system of government... that is wed so tightly to funding campaigns that legislators are endowed to those that control the wealth in this country rather than the American public. Therefore legislators turn the other way when it comes to any regulation that might limit the ability of big campaign donors to further feather their bank accounts, regardless of the cost to the American public.  And with the recent Supreme Court ruling it's only going to get worse.  Only makes me feel more correct that I keep half on my wealth invested outside of this country... it's no less secure anymore, and has bigger potential returns.

Offline mecch

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #1 on: April 10, 2010, 06:08:36 PM »
I don't blame the government, I blame the criminal bankers themselves.  The government could regulate and hopefully will again, but its a policing roll.  Same with any punishment.  But we don't blame the police or government for greedy narcissistic actions. Quite many millions of people had a hand in the big rip off that was the housing finance bubble.  Everyone had a vested interest in share dividends - people investing for retirement, people investing for wealth.  NY state had an interest in the big taxe revenues. And of course the bankers with their bonuses and stock options.  

This proves that going forward the only way to stop such reckless money management is regulation AND progressive taxation -- but who has the spine to put in place???

Everyday I go to work and most of the days I try to do something good for the students, for the institution, and for myself as well.  I think so many people in "service" occupations really see labour as give and take.

Its been years since corporate managemers and especially executives have been motivated or mandated to see their role as give and take.  Its just fucking take take take.

Naturally, people motivated by profit are going to go into highly profitable professions.  But how did we get to this cynical place we are in now?

BLue and Pink collar workers are being ground into misery.  WHite collar employees in big corporations, most of them are being worked to death and see not much return on their investment - all the capital is going to the executives and shareholders.  Big investment banks re-wrote the system and sucked everyone else dry.  

You know that film Good Will Hunting.  Will is brilliant and people ask him why he doesn't want to work for a corporation or the government and use his talents and he quickly explains how his brilliance, his human capital, will inevitably be used to cynical if not also sinister result. He says being a bricklayer would be honest work.  That's a movie and character that is about basic respect for human community.  

The other day, by accident, I was looking on Google map for a beach I used to visit on Long Island when I was a kid.  Then I followed the coastline up past fire island and so on and into the hamptons.  THE VAST development of thousands and thousands of luxury properties in the last 20+ years shows the grand scale THEFT that has occurred.  These people and their money is for the most part NOT made with any interest in give and take and service to the community.  Its mindboggling, the new wealth on display, seen from the air.  

« Last Edit: April 10, 2010, 06:10:35 PM by mecch »
“From each, according to his ability; to each, according to his need” 1875 K Marx

Offline Boo Radley

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #2 on: April 10, 2010, 07:23:33 PM »
I thought that was the whole point of our wonderful economic system -- make a buck any way you can, always look out for Number One (yourself).

String up every aristocrat!
Out with the priests and let them live on their fat!





Everything I do, say, think, excrete, secrete, exude, ooze, or write © 2007 Sweet Old Boo, Inc.

Offline pozniceguy

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #3 on: April 10, 2010, 07:43:53 PM »
I have listened to many of the "causes" of the current  "disaster"  but only a few mention what the actual issue has become......  we are all too comfortable.....both in USA and other "wealthy" countries...there is an assured level of security however small or meager for almost all people....  I know that will bring a shit storm of protest,   but there are places where security is absolutely absent  they don't have "financial crises"  they are too busy surviving....  the few who manage to get some money together get out  as soon as they can  , they come to the "wealthy" countries and open their own business..( a long standing tradition in the take care of yourself world....)   we , collectively , have become dependent on others being in the background doing stuff ...  usually the govmnt  but also  business(  jobs) , banks  ( manage money  maybe pay interest) .local churches ( source of actual support for many ) and others. 
I don't see that this will /can change in the near future  but recognizing that we are responsible for ourselves is critical....  Maybe this crisis will start that thought process again in many people..   save more money ,  don't fall into the trap of wants vs needs  , look ahead further than a few days see what you can do to help yourself.

Nick
remember the good times...honor the past but don't live there
Le stelle la notte sono grandie luminose, nel cuore profondo del Texas

Offline BlueMoon

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #4 on: April 10, 2010, 09:06:43 PM »
It takes two to tango, and millions of Americans deluded themselves into believing that it made sense to buy a house for more that it's worth with no money down and an 'adjustable' (love that term!) interest rate. 

Sure the bankers are amoral leeches, but their schemes worked only because so many were so eager to play their parts in the scam.

...................VL.....CD4.....%
-----------------------------------------
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Offline mecch

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #5 on: April 10, 2010, 09:52:57 PM »
Definitely agree with you!  Its a pity that sensible "bedrock" folks have to suffer collateral damage. 
“From each, according to his ability; to each, according to his need” 1875 K Marx

Offline Boo Radley

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #6 on: April 10, 2010, 10:15:42 PM »
...both in USA and other "wealthy" countries...there is an assured level of security however small or meager for almost all people.... 

Nick

"Small" and "meagre" is right -- do you know what the "poverty level" is for a family of 4 in the USA?  Do you know how many people live at or below that level?  Oh, right, they're the reason for the welfare state we're in, leaching us dry.

And the people looking out for themselves are moving to China, bub, since that's the next and possibly last economic boom area and with 400 billion people there's a lot of potential BOOM.  You and I will be dead before it happens completely but it's started.
  
Quote from: Bluemoon
It takes two to tango, and millions of Americans deluded themselves into believing that it made sense to buy a house for more that it's worth with no money down and an 'adjustable' (love that term!) interest rate.

It's the lending institution's responsibility to ascertain the sale price is reasonable.  Many people in foreclosure didn't "pay" more than they wanted, they had to pay the "market" price.  The bubble burst because after years of ridiculously higher housing rates when the economy got worse (can anyone say "war on terror?"  -- that wasn't the only cause but the TRILLIONS spent and to be spent aren't helping) and people lost jobs they couldn't afford to pay their monthly notes.  Fewer houses were sold so it became a buyer's market and property values had to decrease because few of us can afford to pay $500,000+ on a 2 bedroom dump.

I bought my house in 1998 for $80K, a renovator's dream.  Too bad I got sick 2 years later and couldn't afford to continue renovating.  After Katrina the assessed "value" of my hovel was put on the tax rolls at $330,000.  I'm still contesting that insane evaluation and have gotten the runaround at every turn.  Luckily my mortgage note is still low enough to pay (it would be more expensive to rent but that tends to happen when over 60% of housing is destroyed in one day) but I'll never be able to renovate and can barely maintain it.  My apologies to those who don't "have the burden of property" because I know what a nightmare renting can be, especially in the post-Katrina Gulf Coast.
String up every aristocrat!
Out with the priests and let them live on their fat!





Everything I do, say, think, excrete, secrete, exude, ooze, or write © 2007 Sweet Old Boo, Inc.

Offline bocker3

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #7 on: April 10, 2010, 11:16:28 PM »

It's the lending institution's responsibility to ascertain the sale price is reasonable.  

while that may be true -- you miss the point of the earlier post.  You see it is also the responsibility of the purchaser to buy something that they can afford TODAY -- not assume that it will wildly appreciate and they will be able to suck out more cash to help maintain.  While not everyone did this -- there were many who did - -and they were the epicenter of the "foreclosure crisis".  That set off the snowball that has hit so many.  
So, while I agree that the financial institutions did an awful job at assessing risk and giving credit to folks who had the means to pay back loans -- I am not going to give a free pass to those THIEVES (yes -- taking money that you know you may not be able to pay back is stealing) who walked in and took the money.

It drives me nuts to see people sucking off the government because they bought a house they couldn't afford, without using an "interest only mortgage" or an ARM -- now that they actually have to pay closer to what they owe, they scream about the awful bankers who tricked them.  That is stupidity and I'd rather my tax dollars actually go to folks in need -- stupidity shouldn't be rewarded, because it will only propagate it.

Mike
Atripla - Started 12/05
Reyataz/Norvir - Added 6/06
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Offline mecch

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #8 on: April 11, 2010, 10:22:55 AM »
I agree, I dont understand why people who bought something they couldn't afford should get mortgage help now, unless its another way to just help the economy not implode completely.  It doesnt seem fair to the people who are responsible consumers.  Nor did the bank bailouts seem fair, when the bankers still got their bonuses and parachutes and a year later got even bigger ones. 
This all seems to be the government doing lessor evils to avoid greater evils but its a bitter pill to swallow and I think should be followed up with some real sweat deal for responsible folk, like breaking up the too big to fail banks or somehow making getting setting limits on the banking theft so more profit goes back out to shareholders, and to governments through taxation.
Im sure Barney Frank and others have ideas I hope something happens.  I think you take away the multimillion dollar carrots that lead bankers to be so cynical.  The public should be educated about the risks of investing with privately held banks, and those privately held ones should never get bailouts.  The publicly held banks should have the proper ratio of dividend to bonus, and maybe execs either shouldnt be able to hold so many shares or their salaries should be directly related to dividends.  Seems to me they are double dipping, with great incentive to screw the customer.
“From each, according to his ability; to each, according to his need” 1875 K Marx

Offline fearless

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #9 on: April 11, 2010, 11:53:38 PM »
I think it is being a little tough to be blaming the individuals in this. Most just wanted to get ahead, get a house for themselves and their family. They have limited or no understanding of financial markets, interest rates and risks.

The banks, governments, fed reserve (and their equivalents), economists etc etc all failed abysmally. No of them saw the crash, or warned of the incredible that was the housing market.

The average punter was lead to believe that things were great and this is how it would be for the foreseeable futre.

It's easy in hindsight to call them greedy, foolish or thieves but noone really thought that at the time.

Blame those with the resources behind them that should have no better - Greenspan for keeping rates so low, the bankers for lending the money on the basis that the lendee had the capacity to repay, Wall St and the markets for lapping up the complex financial instruments that supported the whole thing.
Be forgiving, be grateful, be optimistic

Offline MitchMiller

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #10 on: April 13, 2010, 02:36:51 AM »
Although I haven't read through the article, I did listen to the PRI report originating from it.  The point in the article that really raised my eyebrows was that Magnetar was actually fomenting the financial disaster by demanding that packages of securities be overweight with those carrying a HIGHER risk.  Yes... in other words, they were actually telling banks like JP Morgan, to come up with a package that carried a HIGH risk so they could then buy it and turn around and bet on their own package going bad!!!  It is actually thought that Magnetar was a major force in the formation of the bubble.  In the aftermath, the company made a fortune for its clients... up around 76% for 2008.   And, of course, the bankers that put together the risky packages did it knowing full well of the devastating effects it would ultimately have on the overall US economy.  Their bank account are still nicely feathered with the multimillion dollar bonuses they collected from the fees each time one of their packages was sold... to a hedge fund like Magnetar.   What's also amazing is how few of these guys were actually involved in the process.  The PRI report said maybe 50 - 80 employees at JP Morgan were putting together the mortgage backed securities and were the ones collecting most of the bonuses... something like 700 million in fees with 150 million put into a bonus fund for these guys in one year.

It is simply amazing how few people can orchestrate nearly the entire collapse of the world economy.  At AIG it was the same... about 50 or so employees creating the credit default swaps.  Remember if these guys hadn't "generated" a market for this stuff, that little guy buying too much house for his budget, would never have gotten within a hundred yards of a lender's desk.

We often don't see the whole story until articles such as this, surface.  I just heard tonight that this web site won best online investigative reporting award for the year.  This story probably had a lot to do with it.

Offline bocker3

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #11 on: April 13, 2010, 07:38:58 AM »
I think it is being a little tough to be blaming the individuals in this. Most just wanted to get ahead, get a house for themselves and their family. They have limited or no understanding of financial markets, interest rates and risks.

Rubbish -- if you don't know anything about interest rates or risks, then you shouldn't be out buying a house.

Now, I do think that there were instances were bankers took advantage of folks who were simply trying to "get ahead", but if you think that there weren't folks out there knowingly buying houses they couldn't afford, but assuming that the rise in price would "save" them, then you must be living in a cave.

I am not trying to absolve the bankers from their greed and recklessness, but I am not about to give a free pass (or free money) to those individuals who should have known better, but thought that (like the bankers) they had found a way to play the game and make a quick buck.
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Offline Cliff

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #12 on: April 13, 2010, 09:32:18 AM »
We do love our blame games!  Blaming bankers (and I guess others who profited off easy money/booming economy...cos it ain't just bankers) is like blaming a volcano for erupting.  People are greedy.  They will always act (as a group) in their own self interests.  If you pay someone more money for taking extra risks (whether that's a loan, a merger, a trade, a deal, etc..), then they will take more risks.  If you relax mortgage rules to allow people to use leverage to buy bigger and better goods/services/houses, they will!

Apportioning blame is a bit useless.  You can't prevent recessions.  The new regulations will only be as good as the next economic crisis.  Let's just get on with it, already.
« Last Edit: April 13, 2010, 09:39:01 AM by Cliff »

Offline Matty the Damned

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #13 on: April 13, 2010, 09:58:01 AM »
Apportioning blame is a bit useless.  You can't prevent recessions.  The new regulations will only be as good as the next economic crisis.  Let's just get on with it, already.

Sure, but we can prevent obfuscated investment instruments like the bundled debt products (really was there a sub-prime fly in that ointment?) which seem to be in large part responsible for this particular economic clusterfuck.

We can blame the financial regulators (hey Dr Greenspan!) who embraced imprudent deregulation in the late 90s because, y'know, the market like totally knew best, mmmkay?

Sure human greed is a constant, but that doesn't mean we can't place appropriate limits to ameliorate its effects.

MtD

Offline Cliff

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #14 on: April 13, 2010, 10:19:44 AM »
Yeah, some limits are good and necessary.  I was mostly being facetious.  Mostly.  I'm just tired of the blame game (see boring UK politics).  I wish they would just set the new regulations and get on with it.  Politicians have been talking about who failed (us) for nearly two years now with not much change.  We're close to getting to the point where people forget how bad it was.

We may end up with a new, immaterial bank tax (passed on to consumers, of course) and that's about it.  And who will be to blame for that?

Offline fearless

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #15 on: April 13, 2010, 06:55:37 PM »
Rubbish -- if you don't know anything about interest rates or risks, then you shouldn't be out buying a house.

Now, I do think that there were instances were bankers took advantage of folks who were simply trying to "get ahead", but if you think that there weren't folks out there knowingly buying houses they couldn't afford, but assuming that the rise in price would "save" them, then you must be living in a cave.

I am not trying to absolve the bankers from their greed and recklessness, but I am not about to give a free pass (or free money) to those individuals who should have known better, but thought that (like the bankers) they had found a way to play the game and make a quick buck.

You are one mean spirited man then Bocker. Who was predicting a 40% (or whatever it was) drop in house prices in the US before it actually happened. Joe Blow took the advice of professionals.
Your line of argument is just like saying anyone who had sex and ended up with HIV shouldn't get a free pass and have their meds provided under insurance or medicare or any other scheme - if you don't know about the risks involved in sex you shouldn't be having it. ABSTINENCE. Who is living in a cave?
Be forgiving, be grateful, be optimistic

Offline Boo Radley

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #16 on: April 13, 2010, 08:04:16 PM »
...
Your line of argument is just like saying anyone who had sex and ended up with HIV shouldn't get a free pass and have their meds provided under insurance or medicare or any other scheme - if you don't know about the risks involved in sex you shouldn't be having it. ABSTINENCE. Who is living in a cave?

fearless, I {HEART} you! 

Thanks for making the analogy I was afraid to make -- by the logic of some posters it seems reasonable for us to make a cut-off date of, oh, let's say 2005 to be generous.  Anyone infected after 2005 OBVIOUSLY wanted to be or they would have abstained.  Abstinence was part of the official policy of the BushCo & how many people under 8 can claim they didn't know what safer practices are?  Clearly these people should be left to fend for themselves and not drain MY TAX DOLLARS which are still happily paying for the war on terror!!

No more bail-outs!  Self-accountability!  Pull yourself up by the bootstraps! 
String up every aristocrat!
Out with the priests and let them live on their fat!





Everything I do, say, think, excrete, secrete, exude, ooze, or write © 2007 Sweet Old Boo, Inc.

Offline pozniceguy

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #17 on: April 13, 2010, 08:12:10 PM »
Without pushing the "blame game" too far....this whole mess was in fact very predictable...a few funds and a few major players warned about the problem at least three years before it all came crashing down.....  look at the  funds and advisers who were selling off their holdings and advising going to cash/ gold or or other negotiable ......not "Chinese paper" that was based on, based on, and more based  on, wishes and dreams...   there were several local banks here that refused to get into those over blown deals and over funded mortgages for no money down and  115% financing....we had a case right here in the 80s of the  locals who "flipped"  property and increased the "valuations" each time   several went to jail.  about a dozen Banks went under and the real estate market died.... I was a partner with a person we bought several condos   ...originally sold(mortgaged) for $150,000 ea   we paid $25,000 each at auction ( the real value ) , kept them and rented them for 12 yrs  and then sold for a rational price of $30,000 ea,   there were rational people out there,  but there were too many looking for the golden egg  and wanting to get theirs before they killed the Goose that laid it.....knowing that was going to happen...       as far as house prices dropping even that was so predictable....too many "valuations" were based on  those  golden egg people who totally forgot that Value is still the real measure of true worth....  the value of an item as to what its purpose is meant to be.....   housing ( personal)  is meant to be  shelter , only became an "investment"  when the value principle was forgotten...   there have always been irrational trends where value was forgotten....those of you who studied about the great  " tulip "  fiasco of a few hundred years ago  where people all over the world  got caught up in a frenzy of paying outrageous prices for tulip bulbs ( through what was an exchange,  like the stock exchange,,)...... may remember that one...brought on a huge financial disaster...

END OF RANT,    there will always be new scams, unreasonable solutions to non-problems, and con men of every ilk , no matter who is in government /banks/mortgage companies or any other activity...
BUYER BEWARE  is / has always been good advice.... you are responsible for you.....  the devil
 (  govmnt, bank, mortgage company etc ) made me do it  doesn't WASH  

Nick
remember the good times...honor the past but don't live there
Le stelle la notte sono grandie luminose, nel cuore profondo del Texas

Offline Boo Radley

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #18 on: April 13, 2010, 08:19:39 PM »
... I was a partner with a person we bought several condos   ...originally sold(mortgaged) for $150,000 ea   we paid $25,000 each at auction ( the real value ) , kept them and rented them for 12 yrs  and then sold for a rational price of $30,000 ea,  ...
Nick

Got any more property you'd like to sell for $30K?  I'll pay more for a house and not a condo... 
You are an exception among most people, Nick.   Rational price goes out the window if market price is higher.

All my funds went into the cat market but I've never been able to flip any.  The furry little bastards claw me to shreds.
« Last Edit: April 13, 2010, 08:21:57 PM by Boo Radley »
String up every aristocrat!
Out with the priests and let them live on their fat!





Everything I do, say, think, excrete, secrete, exude, ooze, or write © 2007 Sweet Old Boo, Inc.

Offline bocker3

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #19 on: April 13, 2010, 10:29:56 PM »
You are one mean spirited man then Bocker. Who was predicting a 40% (or whatever it was) drop in house prices in the US before it actually happened. Joe Blow took the advice of professionals.
Your line of argument is just like saying anyone who had sex and ended up with HIV shouldn't get a free pass and have their meds provided under insurance or medicare or any other scheme - if you don't know about the risks involved in sex you shouldn't be having it. ABSTINENCE. Who is living in a cave?

The analogy doesn't fit -- I'm not blaming the person that I had unsafe sex with for my infection.  It's my fault -- and insurance is there to pay for medical expenses, so try some other argument. 

Now back to the topic on hand --  you are right people were not expecting a 40% drop in house prices (actually they were expecting a 40% increase, but that was part of the problem now wasn't it)-- but if you bought a house you could afford it didn't really matter.  My house has gone down in value, but I'm not fixing to sell, so I just pay my affordable (fixed rate) mortgage and move on.  I could have saved a ton of money by getting a ARM, but I didn't -- I wanted something I knew would stay the same and that I could afford -- in fact I went for a much cheaper house than I was approved for because one doesn't know what the future holds.  My partner has been without a full time job for a year and half now -- we still can pay our bills, because we didn't get in over our heads.

I'll repeat -- I'm not saying bankers didn't purposely try and screw people, they did, in fact, if what I heard tonite about the shit that went on at Washington Mutual is true -- then those execs should go to prison, but one can't sit here and say that the individuals who bought these homes they couldn't afford are simply victims.  To use your analogy -- if it's my fault for my HIV (and it is), then it is, at least partially, their own fault for biting off more than they could chew.

Call my mean spirited if you want, I like to think of myself as more of a realist.
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Offline Boo Radley

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #20 on: April 13, 2010, 11:15:42 PM »
The analogy doesn't fit -- I'm not blaming the person that I had unsafe sex with for my infection.  It's my fault -- and insurance is there to pay for medical expenses, so try some other argument.
 
Who made that analogy?  I missed it or any implication of it.  I can't speak for fearless but that's not what I read and I didn't say or imply that, or not intentionally.  I think we were both generalizing the analogy, not getting personal. 

Quote
Now back to the topic on hand ... -- we still can pay our bills, because we didn't get in over our heads.

Congratulations!!  You're a model everyone should emulate.  Now that was getting personal (sorry) but your self-righteousness about being one of the decreased number of people who scrimp and save (or come from money, which I don't imply or say applies to you) like my parents and my 3 siblings and many other people is smug.  Your words are wise but you undoubtedly know since post-WWII the ratio of savers to "check-to-checkers" has reversed.  Once a nation of savers the USA has been rabidly consumerist (shit, it's patriotic!) since the last decades of the 20th century, living on credit has become the norm. 

Quote
To use your analogy -- if it's my fault for my HIV (and it is), then it is, at least partially, their own fault for biting off more than they could chew.

I'll use my analogy, thanks.  You deserve no medical insurance of any kind -- it's bailing you out for willful recklessness on your part.   You should never receive any type of assistance from private or public sectors because in your arrogance and hubris you contracted a very expensive viral infection.   Now if you were an "innocent" victim some leniency might be exercised... but by your admission you are guilty as charged.

No, HIV/AIDS should be a model for ALL medical care in the USA -- the ONLY reason we HIV+ people are where we are today was the early fighters (like Peter Staley and many others) who DEMANDED a country blinded by prejudice to deal with a serious public health issue.   Where are Ryan White Act kinds of programs for cancer patients?   Ryan White legislation was, to me, partial admission of and compensation for the lethal neglect suffered by so many thousands of men in practically the first 10 years of the epidemic (maybe 10 or more by some counts). 

Quote
Call my mean spirited if you want, I like to think of myself as more of a realist.

I'm mean-spirited, no question about that!
String up every aristocrat!
Out with the priests and let them live on their fat!





Everything I do, say, think, excrete, secrete, exude, ooze, or write © 2007 Sweet Old Boo, Inc.

Offline pozniceguy

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #21 on: April 14, 2010, 12:31:21 AM »
I truly understand about "market"  prices.....in effect an open auction...open to all who are willing to play / pay.    no one is forced to play/pay....  there are enough rational   sellers that are willing to deal with rational buyers....   the "Market"  is just that  if  it costs more than you are willing to pay  ( or can afford to pay)   don't buy.....

I was in the contracts/ buyer business for many years...there are always willing sellers and buyers out there, just be sure you understand your  needs/ wants ratio when you go shopping for anything......

Nick

BTW  there are still bargains in real estate , I just choose not to participate any longer..... too many hands  constantly trying to get in your pocket .....   sales tax, school tax, local taxes of various kinds, , federal taxes/ rules.....  killing the golden goose.......
remember the good times...honor the past but don't live there
Le stelle la notte sono grandie luminose, nel cuore profondo del Texas

Offline Matty the Damned

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #22 on: April 14, 2010, 01:01:14 AM »
The idea that this is some sort of level playing field is just utter shit, and I think that's the point Little Steve and Boodles have being trying to make.

Deregulation of lending was championed by the Bush Administration (Clinton's too I think) as a means of reducing poverty by increasing home ownership amongst the lower socio-economic classes.

What did it result in? Predatory fucking lending, that's what. Remorseless lending to people who could not be reasonably expected to pay it back. It violates that most sacred responsibility of the lender/banker - thou shalt not make unconscionable loans.

There are legions of stories of lending operations which had buckets of low interest capital to divest themselves of who then pressured low income people into taking out loans those folks could not afford to service, but were led to believe they could.

Not only is it immoral to make unconcscionable loans, it's incredibly destructive. Behold the Global Financial Fucking Crisis.

That's the fucking issue. There is no level playing field here. These people, had they properly and prudently advised most likely would not have taken those sub-prime loans and in any event the obligation on the lenders was not to make such loans in the first place.

MtD

Offline Boo Radley

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #23 on: April 14, 2010, 01:11:23 AM »
Me too!
String up every aristocrat!
Out with the priests and let them live on their fat!





Everything I do, say, think, excrete, secrete, exude, ooze, or write © 2007 Sweet Old Boo, Inc.

Offline BlueMoon

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #24 on: April 14, 2010, 06:37:09 AM »
The problem with comparing HIV infection to buying a house you can't afford is that the distressed homeowner can wipe the slate clean and start over.

The people losing their houses are speculators who gambled on riding a bubble to prosperity.  They thought that they could pay $200K for a $100k house and sell it for $300k.  That's pure greed, on the level of the bankers who facilitated it, but on a smaller scale. 

It's telling that many are in trouble because they leveraged whatever equity they did have into even more debt so they could buy even more stuff.   
...................VL.....CD4.....%
-----------------------------------------
08/10-- ......<40.....290.....42
05/10-- ......<48.....290.....46
02/10-- ......<48.....481.....44
10/09-- ......<48.....277.....46
07/09-- ......<48.....300.....38
05/09-- ........51.....449.....39
03/09-- Added Isentress
02/09-- ........65.....299.....34
11/08-- ........62.....242.....40
08/08-- ........66.....212.....29
05/08-- ......202.....217.....27
03/08-- ....5210.....187.....21
02/08-- Began Truvada/Reyataz/Norvir
12/07-- 273,000.....157.....22
11/07-- 229,000.....209.....22
10/07-- Diagnosis

It's a complex world.

Offline Joe K

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #25 on: April 14, 2010, 08:31:16 AM »
To really understand what has happened you need to look at the whole picture. I moved to Florida in 1999 and bought a house I could easily afford. It remained that way, until housing starting booming and people like Stephen and I, got swept away by incompetence that caused our property taxes, insurance and medical costs to sky rocket. We could always afford the house, but what we could not afford, was our city, that was horribly mismanaged and forced to raise taxes excessively. We had no choice in purchasing Homeowner's, Wind and Hail and Flood insurance, that combined, totaled over $10k per year. Nor did we have any control over Republicans creating Medicare Part D, without adequate funding, which left us responsible for a "doughnut hole", that combined, was over $8k per year.

It really pisses me off, when I hear so many people blaming the homeowner for things beyond their control. I could always afford my home. What I could not afford were unreasonable taxes and insurance rates, because Florida Republicans only care about the rich, plain and simple. Same for DC at the time. Medicare Part D financially devastated both of us and through absolutely no fault of our own, our medical costs became unbearable. If our taxes, insurance and medical costs were reasonable, we would most likely still be living in Florida.

But rather than playing any blame game, we did what we could afford to do, which was to abandon our home, declare bankruptcy and start over at 54 years old. Where my problem lies, is with comments that somehow seem to want to blame Stephen and I, for situations that were not of our making, but which drove us to bankruptcy. We were not speculators who hoped to turn a quick buck, we were homeowners, who owned a very modest home, that were systematically crushed by increasing debt that was unavoidable.

It would seem that many posters here, however, revel in playing the blame game and all I can tell you is I resent the inference that we did something wrong. Actually, it really pisses me off and all I can offer, is you try losing your home and everything you worked so hard for and then come here, so I can tell you that it's all your fault. This thread illustrates what is so wrong with America today, there is far too much concern, that I have mine and who cares about everyone else. That's it in a nutshell folks. The American spirit, used to include looking out for your fellow citizens, but not anymore. As long as I have mine, who cares about the little people. And if they get buried due to being overwhelmed by forces, beyond their control, at least we can fell better, about ourselves, by insisting that it is all their fault and their fault alone. 

Offline BlueMoon

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #26 on: April 14, 2010, 12:49:36 PM »
Killfoile, I think you are trying too hard to get offended.

There have always been people who lose their homes due to drastic and unforseen changes in their circumstances.  That isn't what we're talking about here.  The millions of Americans facing foreclosure have not all been suddenly hit by hurricanes and AIDS.  Quite simply, their bills came due and they had no realistic plan to pay them.  They gambled on speculation and lost.
...................VL.....CD4.....%
-----------------------------------------
08/10-- ......<40.....290.....42
05/10-- ......<48.....290.....46
02/10-- ......<48.....481.....44
10/09-- ......<48.....277.....46
07/09-- ......<48.....300.....38
05/09-- ........51.....449.....39
03/09-- Added Isentress
02/09-- ........65.....299.....34
11/08-- ........62.....242.....40
08/08-- ........66.....212.....29
05/08-- ......202.....217.....27
03/08-- ....5210.....187.....21
02/08-- Began Truvada/Reyataz/Norvir
12/07-- 273,000.....157.....22
11/07-- 229,000.....209.....22
10/07-- Diagnosis

It's a complex world.

Offline pozniceguy

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #27 on: April 14, 2010, 03:43:54 PM »
I truly understand about the "people"  who were killed by the constant  and ever increasing demand on their limited pocketbook to pay   ..that is the primary reason I no longer own any  "investment" real estate....  local govmts in particular up to the state level have squeezed  the "home owners"  recklessly. I have friends who happen to live in one of the worst  hit areas ( Florida) their very nice home that they paid  a reasonable $150,000....  was reappraised by the local taxing authority for $600,000  which caused their  annual property/school taxes to go from < $5000  to more than $25000,  their income didn't change  the house itself was exactly the same, the house payments were the same but the cost of ownership made the the place unaffordable...... the market was so depressed they couldn't even get a decent offer from  any interested parties because of the overvalued  liability that the taxes would place on the house...    truly screwed.....   cant afford to keep it  cant sell it...as Killfoile said maybe abandonment is the only way out
  Even repeated appeals to the taxing authority only allowed a mere 10% reduction in the valuation after nearly a years fight   .....
Nick   
remember the good times...honor the past but don't live there
Le stelle la notte sono grandie luminose, nel cuore profondo del Texas

Offline Cliff

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #28 on: April 15, 2010, 02:36:49 AM »
Sorry, a bit off-topic but someone purchased a home for $150k and it was appraised at $600k?  Really?  That sounds unbelievable.  Did they purchase it for a deal (i.e., bought it from a relative) but the other houses in the area are actually worth $600k?  In which case, I can see that happening but really, they should have known that before they invested in the property!

Offline pozniceguy

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #29 on: April 15, 2010, 04:22:48 PM »
Nope  Cliff true story  they bought the house about 6 yrs ago..in a decent area just north of Orlando, ... a developer built a fancy golf course/housing area next door  and the appraisal authority appraised all the houses nearby at the same level...  even with vigorous appeals ,got little satisfaction... they used some BS  justification  about "nearby similar housing" just to get the tax money , basically ignore the actual selling price/ value that the house would bring   . Real Estate agents do this all the time using "comparables in an area to price a house for sale  ( they get commission on the sale price)....a good part of the reason the" Housing Bubble" was created.
BTW  as I said earlier  Housing is seldom a good "investment "  the value is in the "shelter" you receive,  you may or may not get  a present value increase in the selling price...but you will have had the "shelter" that the house provided..... 

Nick
remember the good times...honor the past but don't live there
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Offline denb45

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #30 on: April 16, 2010, 05:07:19 PM »
Goldman Sachs Charged With Fraud and now the FEDS are suing them, I wonder if more Fraud is coming down the pike for all of the other Financial Groups that screwed everyone else outta house & home   ;D


http://www.goldmansachs666.com/
« Last Edit: April 16, 2010, 05:09:51 PM by denb45 »
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Offline mecch

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #31 on: April 16, 2010, 05:13:53 PM »
Civil suit.  I worked at the SEC. They are spineless suck-ups to Wall Street as an institution.  They'll fry individual bankers but never rock the entire boat.  Obama should push for criminal prosecutions. Just as a good will sign to the "masses" who have been swindled.  This is indeed crime on a vast white collar scale. And its so easy to narrow it down to a few key players anyway, to burn at the stake. Send shivers through the movers and shakers.

http://www.youtube.com/watch?v=C1qFx9e62cY
★ Grace Jones ★ White Collar Crime ★ [1986] ★ "Inside Story" ★

« Last Edit: April 16, 2010, 05:20:12 PM by mecch »
“From each, according to his ability; to each, according to his need” 1875 K Marx

Offline MitchMiller

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #32 on: April 17, 2010, 02:12:33 AM »
Yeah, I heard a commentary on PRI that the SEC cannot bring a criminal suit.  That has to originate from the Attorney General's office.  The analyst said though that a civil suit was preferred as a first step because it is much easier to win and will go through the courts faster... although that still means about three, maybe four years.  
Seems Goldman was caught playing a similar game as Magnetar.  Paulson was principle in creating packages overloaded with risky assets, rated AAA by the real weak in the whole chain - the rating agencies - then reselling them to clients AND betting against them ... whew.!  Magnetar realized that since the ratings agencies were just pumping out AAA grades regardless, they could create packages doomed to fail, then purchase insurance really cheaply... because the cost of the insurance was based on the rating!  At the same time, they can leverage AAA securities to borrow and invest to basically do the same thing all over again... and so on... building a huge multibillion dollar pyramid scheme... doomed to come crashing down ... and that's when the big payoff comes.

The real problem that seems so damned obviously stupid is that the agencies rating the packages are paid by the same companies that put them together.  The higher the rating, the happier the customer.  So the three agencies were stumbling all over one another to show who could be the best at not doing their job and just passing out AAA ratings... while the senior management at these places collected a bundle in salary and bonus based on the huge increase in the volume of packages rated.

It's like a kid that picks the teacher to grade his paper. .. where the teacher gets paid per paper graded... so of course the kid will pick the teacher who gives out A's always and the teachers will race to the top competing to show how fast they can churn out the best grades!!!   When you understand this stuff, you just wonder if Congress is full of a bunch of retards!... or just bald-faced shysters.

If you're interested:
http://www.pbs.org/now/shows/446/index.html
http://www.pbs.org/moyers/journal/04032009/watch.html
« Last Edit: April 17, 2010, 02:29:20 AM by MitchMiller »

Offline mecch

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Re: How Bankers Screwed Americans W/A Pitchfork
« Reply #33 on: April 17, 2010, 08:11:28 AM »
When you understand this stuff, you just wonder if Congress is full of a bunch of retards!... or just bald-faced shysters.

For the GOP now standing together against reform, I'd wager the motivation is politics - any cockamamie strategy currently floated to keep in office and turn around Republican loss of power.  Which begs the deeper question - is Republican politics retarded or shysterism.  Well if it includes being bag man for the Banks in THIS current climate, they are definitely retarded.  The action would be theft but the choice of the action is retarded, clearly.

Where are their smart fathers, mothers, people in their community, their old professors, decent churchmen - where are the people who they still respect who can look these guys in the eyes and persuade them that they are out of touch and not representing any large population.

Every big policy that comes before congress today, I distinctly get a cartoon image of a bunch of spoiled bratty bullies refusing to play ball.  This are the kids your f*cking avoided throughout your youth cause nothing good ever came of trying to do something together. They'd wreck your party. They'd sabotage your project. They cheat in sports or quit the game in protest, or refuse to play, or be sore losers.  They'd condescend to you with loud dirty mouths, and be boorish with half-baked info and ideas in any debate.

When I see their steaming ears and old puffy pig faces on TV I know exactly who they are and its a pity anyone still takes any of them seriously, they've had much too long a run. Really.

And. Thank god McCain lost - his hypocrisy in the last year is sad to watch.

« Last Edit: April 17, 2010, 08:23:48 AM by mecch »
“From each, according to his ability; to each, according to his need” 1875 K Marx

 


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