Beamer wrote on Aug 9, 2012, 22:07:
The housing crisis didn't begin with the bankers (who had nothing to do with it), lenders (who had enormous amounts), traders (who had less), or borrowers (who also had enormous amounts.)
It started with the government. The government changed the rules. In order to make loans accessible to anyone it changed the laws to encourage loans going out to people with bad credit. Lenders swept in and started offering loans to people that they knew likely couldn't pay it back, because the government changed regulations so that these people could. The lenders immediately sold these loans to traders, most of whom had no idea what was going on.
Borrowers were taking loans they knew they couldn't pay.
Lenders were giving them, and as someone that sadly spent a year doing operations/marketing at one of these right out of college, I can tell you most were bending rules for this. I didn't see it first hand, as the ops guys ran my company in a constant struggle with sales guys, but the stories we heard from other companies... and the photoshopped documents we got from borrowers to try to support their loans...
Traders were backing and trading these without a clue.
But it all stemmed from the government relaxing regulations stupidly.
Also, I'm ok with people mocking Obama for being owned by corporations as long as they aren't stupid enough to act as if the Republicans aren't even more in debt to corporate overloads. If the Democrats are 99% the Republicans are 105%.
And yet we continue to hear from those same people about how we need less regulation to really progress.
I guess the question goes back to, why would the government relax regulation on an industry unless they were being asked to/paid to/whatever else to.
I have yet to see the laws changed because a handful individuals want them changed, it takes a overwhelming majority of people to make it happen...and most can't even agree on where to eat in a group of 4.
Plus, even after the regulation was relaxed, they were selling these bad loans at the highest credit rating despite knowing full well they weren't. I highly doubt the government gave a green light to that before or during, but it seems they did after with the lack of prosecution taking place.
And all the rumors of people not having to substantiate how much they made or their worth when applying for loans, just put in a number. Which often times the lender would fill in for you, falsely of course, or change after you applied to make you more appealing....were allegations of that going on to. I remember a story of a guy who never made over 60 grand in his life in any one year, and his loan had him down at about 10 times what he made in a good year.
That kind of stuff, if isolated would be easy to find and prosecute. I think it was pervasive and they just threw their hands up and said screw it at some point, because if they started putting people on the chopping block there wouldn't be many left.
Stories of guys just out of college chumming up to the movie stars, buying the place champagne and having obscene amounts of money because they were lending and bundling these bad loans up and selling them. Etc etc....
In the end it sounded a lot like the ruins of a ponzi scheme. With the home owners being at the bottom (all of them whether they borrowed or not). And the corporations management at the top, because those bonuses were paid out even during the bailouts or perhaps even with the bailouts.
And this all proceeds the illegal foreclosures and what not we hear in the news all the time. And it also sets the standard that they can both take bail out money, which presumably was given to them to stabilize the market so a whole lot of people didn't end up out of their house....and they still end up foreclosing despite the bail out. So they get the bailout money, the house, and any breaks for holding foreclosed properties in a down market.
The whole thing stinks of BS, like it was a concerted effort to screw as many people as possible before it burst. Rational people wouldn't flood/kill their area of expertise like that...they want steady business. Not flood/drought business cycles because it's too volatile to take a chance and expand.
My overall point is, actual value/money was lost and no one seems to be straightening that shit out, protecting against it happening again, prosecuting people who abused/cheated the system with deception. Where as in Dotcom case we have virtual maybe money if a whole lot of criteria is met, and they are busting out all the influence to make sure something happened fast in spite of actual procedure. In a completely different country and on a far less all encompassing scale....he might have had an impact on more people than a mugger, but certainly less than a global economic meltdown and the people who clowned around during it.
The scale of the crime, if huge, seems to warrant no response...or even free money.
GSK fiasco is another great example of BS. Guys pushing drugs via bribery for unapproved treatments and they got fined. Where's the raiding and the beating, they were endangering lives with that shit. Not to mention creating an environment of distrust in the doctor/patient relationship where the money/vacations/madonna tickets means more than your health potentially.
It pays to go big in your crime is the bottom line, no arrests, fines that don't even eliminate half the profits from your crimes don't seem very punitive. And as individuals in these companies, it's not like your take home pay is in danger......even though you knew you were doing illegal shit. Can't help but shake my head at the inconsistent application of laws where crime takes place and yet there's not even a trial to punish the responsible parties...just fines.This comment was edited on Aug 10, 2012, 19:51.