Quote:
Originally Posted by mulp
Why? I mean why feel sorry, or angry?
Look, the mortgage company was making money writing those mortgages. The guy doing the work was getting paid a bonus for the larger loan amount and the variable rate that bumped up. The investment house that packaged them was making money. And the borrower was getting a house for six months for nothing, no obligation actually pay anything back because the loan was no recourse, and if the house went up in price, then he could refi, and everyone gets more money and it costs him nothing, or maybe he sells at a higher price and walks away with cheap rent plus money in his pocket.
And with credit default swaps, everything is no risk so no one is really losing anything.
Those guys on wall street have figured out how to give everyone a free lunch, and they have the Republicans to thank for making sure that wall street wasn't restricted by any stupid regulators or regulation who would prevent wall street from eliminating all risk and giving everyone a free lunch.
Thanks to the Republicans, wall street has been far more innovative than Ponzi ever was.
Maybe in the future we will talk about Greenspan schemes or Republican schemes instead of Ponzi schemes.
And you know, these schemes aren't that simple to figure out if Warren Buffett bought a pile of the garbage without realizing what he was getting until he actually owned Credit Re and really began to understand its finances.
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Thats more of the credit crisis impact on the stock market. Those securities will drop and people will learn from this. The companies legitimately making money will eventually enjoy a restoration of the original stock price. Yeah there should have been oversight by the government but it appears, and there is good arguments, that both the lenders and homeowners just got too greedy. We have learned from this and with the lenders now requiring more documentation for larger loans, things will begin to self regulate.
Lets not forget that a lot of the homes going into foreclosure on the west coast and southwest are investors who bought with equity they should have never had. They took a risk for an even greater profit. Greed is a good motivator but it can really turn against you.