The Monster That Ate Wall Street

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  • Posted By: Pachydont @ 09/28/2008 5:44:10 PM

    I'm no financial wizard by any stretch of the imagination, but I do know that empty houses don't make money. Also, what happens when retirement accounts and currency become worthless? With the U.S. dollar decreasing in value (with other world currencies to follow) and national & international debt steadily rising, is it any wonder the economy is going down the sewer?

    • Posted By: bighappy @ 09/28/2008 5:50:30 PM

      Come on. US undustry uses the newest technology,.unlike Europe, and agreculture is not much behind. What we have to do is be more selfish (stop helping those who spits in our face or tolerate illegal immigrants) and smarter.

  • Posted By: Nar27 @ 09/28/2008 5:43:48 PM

    It is a matter of ethics. No moral standards results in chaos. Have family ties with these no responsibility to anyone but almighty self tycoons.
    When an entity so powerful basically are not bound by ethical standards then we the people need to regulate them.

  • Posted By: qm2ron @ 09/28/2008 5:39:49 PM


    http://www.youtube.com/watch?v=H5tZc8oH--o

  • Posted By: turion @ 09/28/2008 5:14:09 PM

    That's a lot of financial mumbo-jumbo....the likes of Acorn, Barney Frank & Chris Dodd invented the no-doc-no-income mortgage to provide mortgages to masses of people who could not afford them in return for votes. Freddie & Fannie were in their hip pokets and provided the cover. Lobbyists for Freddie & Fannie wined, dined and lined Congress to look the other way....all their friends were raking in the big bucks. And their you have the birth of the sub-prime. All you have to do is look and see who the parents of this mess is. Under the "glow " of the Freddie & Fannie seal of approval.....these packages were scooped up ...no one knowing what they were buying....It made me sick all weekend to see Franks & Dodd on TV making belieive the were heading up the charge on fixing wall street.....placing the blame for all this at everyone elses doorstep....when it belongs at their own feet....And now for the slap in the face of every hardworking American out there...they want to "set aside 30%" of any future profits the taxpayers may realize out of the whole debacle...to go to ACORN !!!.SO THEY CAN CONTINUE THEIR WORK OF REGISTERING DEAD PEOPLE TO VOTE....P.S. Guess who ACORNS lawyer was ??..That's right..the community activist...OBAMA...The Circle is complete

    • Posted By: rail60 @ 09/28/2008 5:39:29 PM

      To bad we don't have an executive branch with, oh lets say a leader type person, chosen by the American people to control these horrible congressmen-that just happen to be Democrats. Wow, these Democrats sure have caused some serious problems in the less than two years controlling congress. Can you imagine the harm they could create if they had a 2/3rds majority to override Dubya's ability to veto. Keep up the good work turion, you're doing "more better" like Dubya and Browny. Don't let anyone missunderestimate you.

  • Posted By: ticked-off @ 09/28/2008 5:35:36 PM

    We need to immediately remove all the current politicians during the next election. It is obvious they are either incompetent or on the take....and I mean every one of them! A clean house (both that is) is the only way to ensure the current corrupted officials are removed from office. Those that are not corrupt (if there really are any) should remove themselves from office for the good of the American people.

    We also need to limit salaries of all executives, management and CEOs on Wall Street. It is obvious that their large salaries created greed and corruption. I hope this shows that the rich are no smarter than the average person on the street....they are simply corrupt and recieved their compensation while breaking the law.

    I think it is time for a revamp of the entire system by the American people. It is obvious we have crooks in office watching crooks in business!

    • Posted By: bighappy @ 09/28/2008 5:39:22 PM

      And bring Socialism and prosperity.

  • Posted By: OpenEye @ 09/28/2008 5:31:00 PM

    This needs to be brought out more in the mainstream media - this has WAY more to do with the mess we are in than a few folks who got an ARM loan on a house. If we keep thinking that those house defaults caused this, we are in for a long bumpy ride, with the ridh getting even richer and the poor and the middle class at each others throats - while our country goes from a super power to a third rate power. Fixing problems like the processes used by banks and other financial institutions which have created an economic house of cards is a priority - but we won't if the news doesn't get to the people on Main Street - so thanks for offering this article!

  • Posted By: tcnw @ 09/28/2008 5:23:50 PM

    The bailout will work temporary for a few months until it wears off and we are going back to square one if the government continue to allow people to get credit and cannot pay them back. The cycle will continue and will need to bail them out again.

    • Posted By: bighappy @ 09/28/2008 5:30:36 PM

      I Goverment uses it wisely, it will work. They may relieve banks from part of their ba mortgages, FORECLOSE homes, rent them for profit and use monew to buy out another part, and so ou. In time, Goverment will sell houses back and return money to tax payers. Unfortunately it is a dream. Smart Republican administration can do it, with Democrats in White House (which is most likely scenario) - never.

  • Posted By: chuckdauer @ 09/28/2008 5:29:36 PM

    Well, it's finally happened. We are now being dictated to by the Government. Doesn't matter what the people want, only Congress and the Senate can determine what happens in this Country. I think it's a joke. We should just find out what these congress criminals want when they take office, and pay them off to stay home.

  • Posted By: Eileen007 @ 09/28/2008 5:27:37 PM

    Elle: Don't know if it will help but Michael Greenberger did a pretty good job explaining it on NPR:
    http://www.npr.org/templates/story/story.php?storyId=89338743

  • Posted By: AMERICAN 1 @ 09/28/2008 5:26:19 PM

    Get off your ass and get a job or two or three and lets stop complaining , pay taxes and live the real american dream to make things better for the next generation . I sure do not want to go down in history as the weak generation who sat on my ass . Think of all the men women and children who "DIED" for this great country .
    P.S. JUST DO IT

  • Posted By: josmith812 @ 09/28/2008 5:23:46 PM

    While the article does make plain this particular bit of voodoo, there have been a series of these problems over the last 20 or so years. This is the largest and perhaps worst but a number of organizations and state/county governments have been using these instruments for years with varying degrees of failure. Similar mumbo jumbo was also used by the likes of ENRON to enhance profits or hide loss. So much for the transparency of Sarbanes-Oxley.

  • Posted By: stellarslayer @ 09/28/2008 5:20:13 PM

    This Bail out better work. If not, I am sending Glenn Beck a torch to hold for me until we need it. It should go well with all the pitch forks the "average" American citizens have sent him as a symbol of how pissed off American citizens are for the rape and pilage of our country through the Wall Street BS, illegal immagration, off shore corporate moves with no tax responsibilities, corporate greed, no temporary 50 mile off shore drilling to bring gas prices down while promoting "green" technology.....is there anything I missed? When you boil it down to brass balls (or is that tacks? I seem to be so pissed off I can't remember...chuckle) its all about lack of moral responsibility and ethics both in Washington and Wall Street. I think those pitch forks and torches should be an oh so subtle reminder for Wall Street as much as Washington.

  • Posted By: markci @ 09/28/2008 1:31:03 PM

    Maybe you should worry less about Democrats who were in the minority in Congress and start worrying more that McCain's right-hand guy is a Freddie Mac lobbyist:

    http://www.bloomberg.com/apps/news?pid=20601070&sid=aQIOOr9klOnE&refer=home

    • Posted By: jfmccann @ 09/28/2008 5:20:04 PM

      and you should worry about the $'s Obama got in donations from these people. At least McCain's right hand man worked for his money. Obama blows hot air.

  • Posted By: elle @ 09/28/2008 5:19:19 PM

    I don't understand the concept at all. So, I'm wondering.... is money like energy-- it can't be created or destroyed only changed from one form to another? If so, where did these trillions of dollars go? Or, was nothing there to begin with and we "ignored the man behind the curtain" and this was wizardry? I make less than $30,000 a year ...I know where every penny is going and what I need to do to meet my obligations. No golden parachute for me --only a crashing decent if I screw up.

  • Posted By: Grendel2 @ 09/28/2008 5:17:39 PM

    What a waste of talent, all those math geniuses figuring out how to make money off of this stupid game, instead of working on new inventions, new energy sources, better buildings, bridges, computer chips, information technology, robotics, etc etc. Now we have nothing but debt and China and India and Dubai have the real stuff. What a shame.

  • Posted By: bkghd @ 09/28/2008 5:05:23 PM

    To those (tcnw) who would blame the homeowners/borrowers in lower income neighborhoods, what else were they to do as they watched the American Dream fly past their doorsteps in the form of out of control and out of sight real estate prices? When a window of opportunity came along in the form of low rates and little risk, they had little choice but to jump on the bandwagon. "Fannie Mae Approval" used to mean something. But once the qualifications and standards loosened, the bubble got pushed beyond the bursting point. Remember 28-36? Qualified borrowers needed a PITI to Gross Income Ratio of 28%, with 36% including car and credit card payments and such. Suddenly loans were being written with 70% PITI to income ratios. Lower qualifying standards standards meant that borrowers could afford more, increasing the money supply, hence increasing demand, and sending housing prices soaring. Traditional economics 101 classes teach that lowering of interest rates staves off inflation. But if a developer is having trouble attracting buyers to his subdivision, and one day rates drop and the next day he finds buyers lined up on his doorstep, he will raise his prices. His competition will jump in and break ground. Building supplies and also rise with the demand at the lumber yard, the hardware store, Sears, and Home Depot. As home values rise, home improvement contractors, benefitting from equity lines, raise their prices because they have more work than they can handle. This is great on the one hand, expansion of the economy, but it is also called inflation. The textbooks need to be be re-written. Finally, couple this with reckless adjustable rates with little or no money down, and you have a recipe for disaster where the writing was on the wall years ago. What drove it all was a thirst for profits today, as if today is in a vacuum, and to hell with what may come tomorrow. Everyone associated with the lending industry, from the mortgage broker to the CEOs of FNMA, AIG, Countrywide, and Bear Stearns, all are essentially paid on commission. The question is, where were the regulators, and whose pockets were they in? Wait! There's still more: One way that the FED controls credit is by adjusting the percentage of cash a bank must have on hand versus its loan portfolio. Historically this has been around 16 - 20%. Increasing the percentage, from say 17.3 to 17.5, tightens credit by forcing the banks to discourage lending through raising rates in order to balance to the new requirement. This is part of the mechanics of what happens when the FED raises or lowers rates when they meet every 6 weeks. They can play with that cash ratio requirement. But recently the investment banks have only about 3.3 cents cash on hand for every dollar in their loan portfolios! Where was the SEC, where was the FED, where were the Fannie/Freddie regulators?

    • Posted By: tcnw @ 09/28/2008 5:16:35 PM

      This is creating a bubble and now it is bursting and you want more so this cycle continue on and on. We do not have another 700 billion to bail you out again. Amazing, no wonder we are in this mess. Until you pay off your debt, you own nothing and risk losing all. This is no American Dream, just a temporary dream until you pay off your debt. So pay off your debt first before making another just like 80 years old grandma Aida who pay off her home. If every one in this country pay off their debt, we will not in this crisis.

    • Posted By: bighappy @ 09/28/2008 5:12:30 PM

      They knew they could not afford those mortgages. Their plans were to live in the house for a while and then sell it by profit. Most needy people who neede house to live there - preferred to rent and wait.

  • Posted By: Grams72 @ 09/28/2008 5:13:18 PM

    tHIS IS REDICULOUS, WE THE PEOPLE ARE THE ONES THAT ARE GOING TO HAVE TO PAY THIS BACK? bULL ***! yOU THE GOVERNMENT OF THE PEOPLE ARE THE ONES THAT GOT US (THE PEOPLE) INTO THIS MESS. bAIL OUT ALL YOU WANT TO, HOWEVER YOU THE GOVERNMENT PAY IT BACK. rEDUCE YOUR PAY, TAKE LESS IN YOUR GRTITUTIES, STOP GIVING THESE LEACHEROUS ceo MILLIONS OF DOLLARS TO LEAVE. yOU PAY IT, i DID NOT DO IT. tHE ONLY THING i DID WAS VOTE YOU ALL INTO OFFICE TO SERVICE THE PEOPLE AND ALL THIS GOVERNMENT HAS DONE WAS DISTROY THE PEOPLES PCOKET BOOKS AND PAD THEIR OWN. lET ME TELL YOU, ANYONE OF THESE GOVERNMENT PEOPLE THAT COME UP FOR REELECTION WILL PAY HELL GETTING MY VOTE.

    i AM SEVENTY TWO YEARS OLD, LIVE WITH MY SON, HAVE TAKEN IN THREE OF MY gRANDCHILDREN AND ON THE BRINK OF LOOSING MY HOME AND YOU WANT ME TO PAY WHAT!!!!! gRAMS FROM cALIFORNIA

  • Posted By: turion @ 09/28/2008 5:12:46 PM

    That's a lot of financial mumbo-jumbo....the likes of Acorn, Barney Frank & Chris Dodd invented the no-doc-no-income mortgage to provide mortgages to masses of people who could not afford them in return for votes. Freddie & Fannie were in their hip pokets and provided the cover. Lobbyists for Freddie & Fannie wined, dined and lined Congress to look the other way....all their friends were raking in the big bucks. And their you have the birth of the sub-prime. All you have to do is look and see who the parents of this mess is. Under the "glow " of the Freddie & Fannie seal of approval.....these packages were scooped up ...no one knowing what they were buying....It made me sick all weekend to see Franks & Dodd on TV making belieive the were heading up the charge on fixing wall street.....placing the blame for all this at everyone elses doorstep....when it belongs at their own feet....And now for the slap in the face of every hardworking American out there...they want to "set aside 30%" of any future profits the taxpayers may realize out of the whole debacle...to go to ACORN !!!.SO THEY CAN CONTINUE THEIR WORK OF REGISTERING DEAD PEOPLE TO VOTE....P.S. Guess who ACORNS lawyer was ??..That's right..the community activist...OBAMA...The Circle is complete

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