Post by The Great Aztec Joe on Nov 23, 2011 16:00:43 GMT -8
The stage was set for the 2008 wipeout of the global economy with the mortgage refinancing craze that began around the year 2001. Sadly, so much of it was totally corrupt and that led to further corruption.
Shortly before that 2001 kick off of massive corruption, U.S. Federal Reserve cut interest rates to help the economy recover from the Tech Stock Collapse on Wall Street. Home owners and home buyers jumped at the chance to get "cheap" mortgages and a feeding frenzy ensued.
As a result, mortgage refinancing hit record levels, climbing from $460 billion in 2000 -2001 to a staggering $2.8 trillion in 2003.
This also allowed people to borrow against the equity of their homes and use these borrowed funds to buy televisions, cars, appliances, computers and whatever other large purchases they had been putting off. I know, because the wife wanted to spend more money than we had, so we took out a home equity loan so she could spend and be happy. When home interest rates fell to 4% two years ago, I refinanced the home equity loans into the first mortgage, so I was not hurt.
According to the FCIC report, the refinancing mania resulted in home owners taking out $2 trillion in equity from their houses in the years between 2001 and 2007. Who was president then?
All this would have been bad enough, but around the same time Wall Street Republiscam Bankers and Controllers figured out a way it could make money—a lot of money—with all of this new debt.
The Republiscam banksters realized that they could "bundle" debt (particularly mortgages) into fake investments. It was literally a license to print money. It allowed Wall Street banks to create credit (money) out of thin air, and the fees from this artificial money-creation simply boggled the imagination.
Like any Ponzi or Madoff scheme, everything worked fine as long as there was a steady stream of new investors. But eventually, the financial house of cards received a nasty jolt, around 2007, when some of the underlying subprime mortgages and variable interest home equity loans began to default.
In addition to all of this Republiscam nonsense:
Rating agencies like Standard & Poors and Moody's participated in a global fraud on the investing public. They had the power to rate what they wanted any way they wanted. They still do and can trash whole countries in the process.
Federal officials actually stymied investigations into bank fraud by states attorneys general. Their reasoning was that if there is no investigation no crime can be said to have been committed.
The Comptroller of the Currency (OCC) blocked investigations of Wachovia, Citibank and other big banks. It helps to have corrupt friends in high places as well as politicians who help you bend the rules for personal tremendous wealth gain. Make 10 Million and retire to the south coast of France or Spanish Mallorca!
The U.S. Supreme Court protected Wall Street bank hustlers from regulators. Corruption went to the very top.
Republiscam run banks offered consumers "interest only" loans—and they grew to be 25 percent of the mortgage market in 2005. Unbelievable corruption! And those sons of bitches were all slapping each other on the back while they were waiting for the coming collapse. To buy my house in 1975 I had to have four times my mortgage payment in income. That was waved. All you had to do in 2005 was have close to the income to be able to make the payments. Nobody really checked. Why should they, when they all knew that it would all collapse?
Republiscam banks hired "highly educated but totally out of contact with reality" geeks and nerds out of honored colleges. They labeled their new hires as "mathematical geniuses" who convinced naïve investors that bundled debt was safe and secure. Hell, I come from Yale. You can trust me. Triple "A" Rated Folks and we are selling them at a discount just for you!
Once the Repucliscam Bankers showed the world how it could be done and all the bankers could get filthy stinking rich, the U.S. housing bubble quickly spread all over the world and threatened the global economy. They copied us! We showed the world how to be corrupt in style.
On Wall Street they had an insider code that people greeted each other with, " In a few years, I'll Be Gone, You'll Be Gone!" It was very prophetic. Many took their money and ran to the exits in late 2007 and early 2008. If they had any investments at all, they were short the market, because they knew what their corrupt efforts had caused and would cause.
Why haven't a flood of Wall Street CEO's been charged with high crimes despite evidence of massive, systematic fraud?
The real estate catastrophic wipeout that began in 2007 will be remembered as one of the greatest financial disasters in history—one that continues to threaten the financial survival of millions of hard-working American families to this day.
It's estimated that since the peak of the housing market, U.S. home values have fallen by a staggering $6.3 trillion.
According to the Mortgage Bankers Association, at least 8 million Americans are at least one month behind on their mortgage payments.
Approximately 10 + percent of all homes in the United States are currently standing vacant.
An all-time record of 2.87 million U.S. households received a foreclosure filing in 2010. We will get the numbers for 2011 in a few weeks.
New home sales in the United States are now down 80 percent from the peak in July 2005. You can't put homebuilders back to work until there is a market for more new homes.
If you want to understand how America's banks could have been left holding trillions of dollars of bad real estate debts you need look no further than Florida's artificially overheated housing market in the 2000s. (Bankers playing games in cahoots with crooks.)
According to an investigation by the Herald-Tribune in Sarasota, Fla., in the last 10 years more than 50,000 houses and properties in Florida were "flipped" under "suspicious circumstances."
In these cases, houses, commercial properties and even vacant lots were bought and resold in less than 90 days at a new price that was at least 30 percent higher than the original price.
The crazy housing market made it easy for Republiscam crooks with good credit to buy a house, get a no-questions-asked mortgage and then immediately sell the house for more money to a co-conspirator who could default on the loan or sell at an even higher price to another co-conspirator who could then default. The corruption just goes around and around.
In the process, they'd use the new, fake price to get another mortgage for more than the house was really worth and split the extra proceeds as quick profit.
The results of all this fraud were toxic investments that were marketed to investors around the globe. And since the rating agencies with all those geniuses working for them, who were supposed to understand what were in these investments, rated them AAA, naïve investment groups sunk billions of dollars into them.
The consequences of this systematic real estate fraud have been catastrophic. Yet, we are not seeing these crooks put into prison where they belong for life.
As the FCIC accurately reports, "In Colorado fraudulent losses of $11 billion... could cause the Public Employees Retirement Association plan—which covers 450,000 public workers and teachers—to go bust in two decades." As a result the State had to cut retiree benefits to account for the losses. Most State Civil Service Employees do not make that much in the first place. To have their retirements cut is very painful. Many will have to work a job in retirement just to get by. (Retirement, what retirement?)
Other states were equally hurt.
Republiscam bankers and brokers got away with fraudulently borrowing millions of dollars in mortgages without investing a single dime. Those scammers used these government-backed mortgages to make millions of dollars from fake transactions., destroying the U.S. economy in the process.
And now the Republiscams want you to vote them back into the Presidency. We are on the edge of a civil war that will result in a rewriting of the constitution to put corrupt bankers to death. We will see if they want to try their tricks then.
Shortly before that 2001 kick off of massive corruption, U.S. Federal Reserve cut interest rates to help the economy recover from the Tech Stock Collapse on Wall Street. Home owners and home buyers jumped at the chance to get "cheap" mortgages and a feeding frenzy ensued.
As a result, mortgage refinancing hit record levels, climbing from $460 billion in 2000 -2001 to a staggering $2.8 trillion in 2003.
This also allowed people to borrow against the equity of their homes and use these borrowed funds to buy televisions, cars, appliances, computers and whatever other large purchases they had been putting off. I know, because the wife wanted to spend more money than we had, so we took out a home equity loan so she could spend and be happy. When home interest rates fell to 4% two years ago, I refinanced the home equity loans into the first mortgage, so I was not hurt.
According to the FCIC report, the refinancing mania resulted in home owners taking out $2 trillion in equity from their houses in the years between 2001 and 2007. Who was president then?
All this would have been bad enough, but around the same time Wall Street Republiscam Bankers and Controllers figured out a way it could make money—a lot of money—with all of this new debt.
The Republiscam banksters realized that they could "bundle" debt (particularly mortgages) into fake investments. It was literally a license to print money. It allowed Wall Street banks to create credit (money) out of thin air, and the fees from this artificial money-creation simply boggled the imagination.
Like any Ponzi or Madoff scheme, everything worked fine as long as there was a steady stream of new investors. But eventually, the financial house of cards received a nasty jolt, around 2007, when some of the underlying subprime mortgages and variable interest home equity loans began to default.
In addition to all of this Republiscam nonsense:
Rating agencies like Standard & Poors and Moody's participated in a global fraud on the investing public. They had the power to rate what they wanted any way they wanted. They still do and can trash whole countries in the process.
Federal officials actually stymied investigations into bank fraud by states attorneys general. Their reasoning was that if there is no investigation no crime can be said to have been committed.
The Comptroller of the Currency (OCC) blocked investigations of Wachovia, Citibank and other big banks. It helps to have corrupt friends in high places as well as politicians who help you bend the rules for personal tremendous wealth gain. Make 10 Million and retire to the south coast of France or Spanish Mallorca!
The U.S. Supreme Court protected Wall Street bank hustlers from regulators. Corruption went to the very top.
Republiscam run banks offered consumers "interest only" loans—and they grew to be 25 percent of the mortgage market in 2005. Unbelievable corruption! And those sons of bitches were all slapping each other on the back while they were waiting for the coming collapse. To buy my house in 1975 I had to have four times my mortgage payment in income. That was waved. All you had to do in 2005 was have close to the income to be able to make the payments. Nobody really checked. Why should they, when they all knew that it would all collapse?
Republiscam banks hired "highly educated but totally out of contact with reality" geeks and nerds out of honored colleges. They labeled their new hires as "mathematical geniuses" who convinced naïve investors that bundled debt was safe and secure. Hell, I come from Yale. You can trust me. Triple "A" Rated Folks and we are selling them at a discount just for you!
Once the Repucliscam Bankers showed the world how it could be done and all the bankers could get filthy stinking rich, the U.S. housing bubble quickly spread all over the world and threatened the global economy. They copied us! We showed the world how to be corrupt in style.
On Wall Street they had an insider code that people greeted each other with, " In a few years, I'll Be Gone, You'll Be Gone!" It was very prophetic. Many took their money and ran to the exits in late 2007 and early 2008. If they had any investments at all, they were short the market, because they knew what their corrupt efforts had caused and would cause.
Why haven't a flood of Wall Street CEO's been charged with high crimes despite evidence of massive, systematic fraud?
The real estate catastrophic wipeout that began in 2007 will be remembered as one of the greatest financial disasters in history—one that continues to threaten the financial survival of millions of hard-working American families to this day.
It's estimated that since the peak of the housing market, U.S. home values have fallen by a staggering $6.3 trillion.
According to the Mortgage Bankers Association, at least 8 million Americans are at least one month behind on their mortgage payments.
Approximately 10 + percent of all homes in the United States are currently standing vacant.
An all-time record of 2.87 million U.S. households received a foreclosure filing in 2010. We will get the numbers for 2011 in a few weeks.
New home sales in the United States are now down 80 percent from the peak in July 2005. You can't put homebuilders back to work until there is a market for more new homes.
If you want to understand how America's banks could have been left holding trillions of dollars of bad real estate debts you need look no further than Florida's artificially overheated housing market in the 2000s. (Bankers playing games in cahoots with crooks.)
According to an investigation by the Herald-Tribune in Sarasota, Fla., in the last 10 years more than 50,000 houses and properties in Florida were "flipped" under "suspicious circumstances."
In these cases, houses, commercial properties and even vacant lots were bought and resold in less than 90 days at a new price that was at least 30 percent higher than the original price.
The crazy housing market made it easy for Republiscam crooks with good credit to buy a house, get a no-questions-asked mortgage and then immediately sell the house for more money to a co-conspirator who could default on the loan or sell at an even higher price to another co-conspirator who could then default. The corruption just goes around and around.
In the process, they'd use the new, fake price to get another mortgage for more than the house was really worth and split the extra proceeds as quick profit.
The results of all this fraud were toxic investments that were marketed to investors around the globe. And since the rating agencies with all those geniuses working for them, who were supposed to understand what were in these investments, rated them AAA, naïve investment groups sunk billions of dollars into them.
The consequences of this systematic real estate fraud have been catastrophic. Yet, we are not seeing these crooks put into prison where they belong for life.
As the FCIC accurately reports, "In Colorado fraudulent losses of $11 billion... could cause the Public Employees Retirement Association plan—which covers 450,000 public workers and teachers—to go bust in two decades." As a result the State had to cut retiree benefits to account for the losses. Most State Civil Service Employees do not make that much in the first place. To have their retirements cut is very painful. Many will have to work a job in retirement just to get by. (Retirement, what retirement?)
Other states were equally hurt.
Republiscam bankers and brokers got away with fraudulently borrowing millions of dollars in mortgages without investing a single dime. Those scammers used these government-backed mortgages to make millions of dollars from fake transactions., destroying the U.S. economy in the process.
And now the Republiscams want you to vote them back into the Presidency. We are on the edge of a civil war that will result in a rewriting of the constitution to put corrupt bankers to death. We will see if they want to try their tricks then.