The Greedy B*st*ards Can't Help Themselves

A great article today
"How the Banks are Worsening the Foreclosure Crises"

The banks cannot help themselves and unfortunately Congress is listening to the banking lobby. Every "new idea" to turn around this economy seems to start out with good intentions and then the banks get involved. Despite the best efforts of some ... the greed is too great.

[..]on Apr. 18, 2007, behind closed doors in an ornate hearing room in the marble-faced Dirksen Senate Office Building. Dodd told them they needed to get out in front of the foreclosure fiasco by adjusting loan terms so borrowers would continue to make some payments, rather than stopping altogether.

Sandor E. Samuels, at the time chief legal officer of subprime giant Countrywide Financial. They vowed to continue selling loans with enticing introductory rates as well as those requiring minimal evidence of borrowers' income. "We are going to keep making these loans until the last second they are legal," Samuels later told a fellow participant.

Despite being warned .... there was just too much money being made selling these mortgages and packaging them. Greed can make some so blind.

A major reason financial institutions and investors are so determined to avoid modifying loan terms more aggressively has to do with accounting nuances, say industry lobbyists. If, for example, a bank lowered the balance of a certain mortgage, there would be a strong argument that it would have to reduce the value on its balance sheet of all similar mortgages in the same geographic area to reflect the danger that the region had hit an economic slump. Under this stringent approach, financial industry mortgage-related losses could far surpass even the grim $1.1 trillion estimated by Goldman Sachs (NYSE:GS - News) in January.

It wasn't until the collapse that the banking industry finally had no choice to cry for help. (to a certain degree).
So what about all those programs that the previous admnistration put out there?

Hope for Homeowners -- which Bush officials and banks promised last fall would shield 400,000 families from foreclosure -- has so far produced only 25 refinanced loans.

In the end ... despite Congress' efforts and the banking industries counter efforts.... we will eventually see a bottom in housing .... meanwhile it will be managed all the way down and Congress will continue to throw massive amounts of money at these greedy b*st*rds.

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Comments

they assuredly caused it

Submitted by on

So, why we have the same people running it is beyond me!

But they also (still) have Government in their pocket although I think it's starting to dawn on a few that maybe they shouldn't be listening to institutions with lobbyists who are basically insolvent.

It wont happen

until the banks finally start feeling their demise. Until they are gasping their last breath and realize that if they don't take some of the hit they won't be in business any longer.

In the first days of 2009 it appeared that progress might be possible on a different front. A slumping Citigroup came back to the Treasury Dept. for a second round of bailout money. Bowing to pressure from regulators, Citi broke ranks with its rivals and dropped its opposition to bankruptcy cramdown.

Of course they will eat their own before that all happens. Just like the depression only the well connected will be left standing.

By the time McConnell talked to the JPMorgan and BofA representatives the next day, however, "they had gone on full defense mode and started to complain about how lousy a deal Citi had struck," says the person familiar with the exchanges. Bank opposition, Durbin says, "was very shortsighted in light of the mess they have created in our economy."

On the point about the same people running the show. What I found interesting was we had three nominees for position with the current administration (Solis, Daschle, Geithner) with tax problems .... and the only one to emerge was the one connected to the banks and FED.

It has always been about class warfare.